10 Percent Credit Card Interest Rate Cap Act

119 S381 IS: 10 Percent Credit Card Interest Rate Cap Act U.S. Senate 2025-02-04 text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain. II 119th CONGRESS 1st Session S. 381 IN THE SENATE OF THE UNITED STATES February 4, 2025 Mr. Sanders (for himself and Mr. Hawley ) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs A BILL To amend the Truth in Lending Act to cap credit card interest rates at 10 percent. 1. Short title This Act may be cited as the 10 Percent Credit Card Interest Rate Cap Act . 2. Cap on credit card interest rates (a) In general Section 107 of the Truth in Lending Act ( 15 U.S.C. 1606 ) is amended by adding at the end the following: (f) (1) The annual percentage rate applicable to an extension of credit obtained by use of a credit card may not exceed 10 percentage points, inclusive of all finance charges. (2) Any fees that are not considered finance charges under section 106(a) may not be used to evade the limitations of paragraph (1), and the total sum of such fees may not exceed the total amount of finance charges assessed. (3) The taking, receiving, reserving, or charging of a credit card annual percentage rate or fee greater than that permitted under this subsection, when knowingly done, shall be deemed a violation of this title, and a forfeiture of the entire interest which the note, bill, or other evidence of the obligation carries with it, or which has been agreed to be paid thereon. (4) If a credit card annual percentage rate or fee greater than that permitted under this subsection has been paid, the person by whom it has been paid, or the legal representative thereof, may, by bringing an action not later than 2 years after the date on which the usurious collection was last made, recover back from the lender in an action in the nature of an action of debt, the entire amount of interest, finance charges, or fees paid. (5) Any creditor who violates this subsection shall be subject to the provisions of section 130. (g) Nothing in this section may be construed to preempt any provision of State law that provides greater protection to consumers than is provided under this section. . (b) Technical and conforming amendment Section 130(a) of the Truth in Lending Act ( 15 U.S.C. 1640(a) ) is amended, in the matter preceding paragraph (1), by inserting section 107(f), before this chapter . (c) Sunset (1) In general The Truth in Lending Act ( 15 U.S.C. 1601 et seq. ) is amended— (A) in section 107 ( 15 U.S.C. 1606 ), by striking subsections (f) and (g); and (B) in section 130(a) ( 15 U.S.C. 1640(a) ), in the matter preceding paragraph (1), by striking section 107(f), . (2) Effective date The amendments made by paragraph (1) shall take effect on January 1, 2031.