Small Business Lending Fairness Act

IB Union Calendar No. 336 116TH CONGRESS 2D SESSION H. R. 3490 [Report No. 116–417] To amend the Truth in Lending Act to prohibit certain unfair credit practices, and for other purposes. IN THE HOUSE OF REPRESENTATIVES JUNE 25, 2019 Ms. VELA´ZQUEZ (for herself, Mr. MARSHALL, and Mr. SCHNEIDER) intro- duced the following bill; which was referred to the Committee on Finan- cial Services MARCH 19, 2020 Reported with an amendment; committed to the Committee of the Whole House on the State of the Union and ordered to be printed [Strike out all after the enacting clause and insert the part printed in italic] [For text of introduced bill, see copy of bill as introduced on June 25, 2019] VerDate Sep 11 2014 22:39 Mar 19, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6652 E:\BILLS\H3490.RH H3490 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 3490 RH A BILL To amend the Truth in Lending Act to prohibit certain unfair credit practices, and for other purposes. VerDate Sep 11 2014 22:39 Mar 19, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6652 E:\BILLS\H3490.RH H3490 kjohnson on DSK79L0C42PROD with BILLS 3 •HR 3490 RH Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Small Business Lending 4 Fairness Act’’. 5 SEC. 2. OBLIGOR TRANSACTIONS. 6 (a) IN GENERAL.—Chapter 2 of the Truth in Lending 7 Act (15 U.S.C. 1631 et seq.) is amended by adding at the 8 end the following: 9 ‘‘§ 140B. Unfair credit practices 10 ‘‘(a) IN GENERAL.—In connection with the extension 11 of credit or creation of debt in or affecting commerce, as 12 defined in section 4 of the Federal Trade Commission Act 13 (15 U.S.C. 44), including any advance of funds or sale or 14 assignment of future income or receivables that may or may 15 not be credit, no person may directly or indirectly take or 16 receive from another person an obligation that constitutes 17 or contains a cognovit or confession of judgment (for pur- 18 poses other than executory process in the State of Lou- 19 isiana), warrant of attorney, or other waiver of the right 20 to notice and the opportunity to be heard in the event of 21 suit or process thereon. 22 ‘‘(b) EXEMPTION.—The exemption in section 104(1) 23 shall not apply to this section.’’. 24 (b) TECHNICAL AND CONFORMING AMENDMENTS.— 25 VerDate Sep 11 2014 22:39 Mar 19, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6203 E:\BILLS\H3490.RH H3490 kjohnson on DSK79L0C42PROD with BILLS 4 •HR 3490 RH (1) Section 103 of the Truth in Lending Act (15 1 U.S.C. 1602) is amended by adding at the end the fol- 2 lowing: 3 ‘‘(ff) The term ‘debt’ means any obligation of a person 4 to pay to another person money— 5 ‘‘(1) regardless of whether such obligation is ab- 6 solute or contingent if the understanding between the 7 parties is that any part of the money shall be or may 8 be returned; 9 ‘‘(2) that includes the right of the person pro- 10 viding the money to an equitable remedy for breach 11 of performance if the breach gives rise to a right to 12 payment; and 13 ‘‘(3) regardless of whether the obligation or right 14 to an equitable remedy described in paragraph (2) 15 has been reduced to judgment, fixed, contingent, ma- 16 tured, unmatured, disputed, undisputed, secured, or 17 unsecured.’’. 18 (2) Section 130(a) of the Truth in Lending Act 19 (15 U.S.C. 1640) is amended by striking ‘‘creditor’’ 20 each place the term appears and inserting ‘‘person’’. 21 (3) The table of sections in chapter 2 of the 22 Truth in Lending Act (15 U.S.C. 1631 et seq.) is 23 amended by adding at the end the following: 24 ‘‘140B. Unfair credit practices.’’. VerDate Sep 11 2014 22:39 Mar 19, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6213 E:\BILLS\H3490.RH H3490 kjohnson on DSK79L0C42PROD with BILLS VerDate Sep 11 2014 22:39 Mar 19, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6213 E:\BILLS\H3490.RH H3490 kjohnson on DSK79L0C42PROD with BILLS Union Calendar No. 336 116TH CONGRESS 2D SESSION H. R. 3490 [Report No. 116–417] A BILL To amend the Truth in Lending Act to prohibit certain unfair credit practices, and for other pur- poses. MARCH 19, 2020 Reported with an amendment; committed to the Com- mittee of the Whole House on the State of the Union and ordered to be printed VerDate Sep 11 2014 22:39 Mar 19, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6651 Sfmt 6651 E:\BILLS\H3490.RH H3490 kjohnson on DSK79L0C42PROD with BILLS