H.R.4410 - Credit Card On-Time Payment Protection Act of 1998105th Congress (1997-1998)
Text: H.R.4410 — 105th Congress (1997-1998)
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Introduced in House (08/05/1998)
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[Congressional Bills 105th Congress] [From the U.S. Government Printing Office] [H.R. 4410 Introduced in House (IH)] 105th CONGRESS 2d Session H. R. 4410 To amend the Truth in Lending Act to protect consumers from certain unreasonable practices of credit cards issuers which result in cancellation of credit, higher fees or rates of interest, or other penalties that result in higher or unnecessary costs to card holders who pay credit card balances in full, and for other purposes. _______________________________________________________________________ IN THE HOUSE OF REPRESENTATIVES August 5, 1998 Mr. LaFalce (for himself, Mr. Yates, and Mr. Kennedy of Massachusetts) introduced the following bill; which was referred to the Committee on Banking and Financial Services _______________________________________________________________________ A BILL To amend the Truth in Lending Act to protect consumers from certain unreasonable practices of credit cards issuers which result in cancellation of credit, higher fees or rates of interest, or other penalties that result in higher or unnecessary costs to card holders who pay credit card balances in full, and for other purposes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE. This Act may be cited as the ``Credit Card On-Time Payment Protection Act of 1998''. SEC. 2. PENALTIES FOR ON-TIME PAYMENT PROHIBITED. Section 127 of the Truth in Lending Act (15 U.S.C. 1637) is amended by inserting at the end thereof the following new subsection: ``(h) Penalties for On-Time Payment Prohibited.-- ``(1) In general.--In the case of any credit card account under an open-end consumer credit plan, no creditor may cancel an account, impose a minimum finance charge for any period (including any annual period), impose any fee in lieu of a minimum finance charge or impose any other charge or penalty with regard to such account or credit extended under such account solely on the basis that any credit extended has been repaid in full before the end of any grace period applicable with respect to the extension of credit. ``(2) Payment due dates.--For purposes of paragraph (1), a creditor shall be deemed to have imposed a prohibited charge or penalty on an account under an open end consumer credit plan if the creditor regularly transmits to the obligor of such plan a statement for a billing cycle in which credit has been extended under such plan that includes a payment due date as required by subsection (b)(9) of this section-- ``(A) that is different from and in advance of-- ``(i) the date by which payment must be made for any credit extended under such credit plan to avoid incurring a finance charge that was disclosed to such obligor pursuant to subsection (c)(1)(A)(iii) of this section; or ``(ii) the actual date by which payment would otherwise have to be made to avoid incurring a finance charge if calculated on the same basis as the date by which or the period within which any payment must be made to avoid incurring a finance charge that was disclosed to such obligor pursuant to subsection (c)(1)(A)(iii); and ``(B) that has the purpose or effect of inducing the obligor of such plan to transmit payment to the creditor earlier than what otherwise would be required to avoid incurring a finance charge. ``(3) Scope of application.--Paragraph (1) shall not be construed as-- ``(A) prohibiting the imposition of any flat annual fee which may be imposed on the consumer in advance of any annual period to cover the cost of maintaining a credit card account during such annual period without regard to whether any credit is actually extended under such account during such period; or ``(B) otherwise affecting the imposition of the actual finance charge applicable with respect to any credit extended under such account during such annual period at the annual percentage rate disclosed to the consumer in accordance with this title for the period of time any such credit is outstanding.''. SEC. 3. REGULATIONS. The Federal Reserve Board, not later than 6 months after the date of the enactment of this Act, shall issue final regulations to implement the amendments made by this Act. <all>