I 111th CONGRESS 1st Session H. R. 2327 IN THE HOUSE OF REPRESENTATIVES May 7, 2009 Mr. Hensarling (for himself, Mr. Burgess, Mr. Bishop of Utah, Mr. Kline of Minnesota, Mr. Conaway, Mr. Shadegg, Mr. Pitts, Mr. Garrett of New Jersey, Mr. Brady of Texas, Mr. McKeon, Mr. Gingrey of Georgia, Mr. Olson, Mr. Gohmert, Mr. Poe of Texas, Mr. Fleming, Mrs. Lummis, Mr. Marchant, Mr. Neugebauer, Mr. Posey, and Ms. Foxx) introduced the following bill; which was referred to the Committee on Financial Services A BILL To preserve consumer choice and access to credit and enhance consumer disclosures.

1.

Short title

This Act may be cited as the Protection of Consumer Credit and Consumer Choice Act of 2009.

2.

Unfair acts or practices rule revision

The Board of Governors of the Federal Reserve, the Office of Thrift Supervision, and the National Credit Union Administration shall not take any action to implement any rule relating to credit cards published in the Federal Register on January 29, 2009, or any substantially similar rule, on the basis of a determination by such agencies that practices relating to credit card practices constitute an unfair act or practice in or affecting commerce.

3.

Improving consumer disclosures

Section 127 of the Truth in Lending Act (15 U.S.C. 1637) is amended by adding at the end the following new subsection: (i)

Advance notice of rate increases for certain practices

(1)

In general

With respect to credit card accounts under an open end consumer credit plan, the Board shall issue regulations under subsections (a), (b), and (c), as the Board may find appropriate and necessary, to require a card issuer to provide clear and conspicuous disclosures pertaining to: (A)the time provided to make timely payments; (B)allocation of payments when different annual percentage rates apply to different balances of such accounts; (C)increases in annual percentage rates; (D)two-cycle average daily balance method of balance calculation; and (E)fees that may be assessed at the opening of such accounts. (2)

Advance notice for certain changes

(A)

In general

A change to any term described in paragraph (1), or, in the case of paragraph (1)(C), an increase of an annual percentage rate, with respect to a credit card account under an open end consumer credit plan may not take effect unless the card issuer provides a written notice to the consumer no less than 75 days before such change is scheduled to take effect which fully describes the change in a clear and conspicuous manner. (B)

Exception

Any disclosure under subparagraph (A) shall not be required with respect to an increase in an annual percentage rate if: (i)the increase is due to the operation of an index outside the control of the card issuers; (ii)the increase is due to an expiration of a promotional rate; and (iii)the rate was previously disclosed pursuant to subsection (a). .

4.

Effective date

(a)Section 2 of this Act is effective on the date of enactment of this Act. (b)The Board shall issue the regulations under section 3 within 12 months of the date of enactment of this Act. (c)The regulations issued by the Board under section 3 shall be effective 12 months after they are published in final form.