HBA-CBW H.B. 2154 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 2154 By: Averitt Financial Institutions 3/16/2001 Introduced BACKGROUND AND PURPOSE Under current law, the holder of a delinquent motor vehicle retail installment sales contract may be assessed either a late charge or simple interest charge, at the contracted rate, on delinquent contracts. During the 76th Legislature, legislation was enacted to facilitate the charging of late fees, in addition to interest accrual, on many types of loan contracts. However, motor vehicle retail installment sales contracts were not included in the legislation. Under current law, the holder of such a contract with an unpaid installment may collect a delinquency charge or simple interest, but not both. House Bill 2154 allows the charging of a late charge, in addition to regular interest accrual, on contracts. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS House Bill 2154 amends the Finance Code to provide that a motor vehicle retail installment contract (contract) that provides for the accrual earnings method may provide for a delinquency charge, interest, or both on a delinquent contract. The bill provides that a contract may provide for an unpaid installment to collect interest on the amount of the installment accruing after the maturity of the installment and until the installment is paid in full. EFFECTIVE DATE On passage, or the Act does not receive the necessary vote, the Act takes effect September 1, 2001.