S. 3259, The Consumer Credit Fairness Act

• This item is from the 110th Congress (2007-2008) and is no longer current. Comments, voting, and wiki editing have been disabled, and the cost/savings estimate has been frozen.
• This bill, or a similar bill, was reintroduced in the current Congress as S. 257, The Consumer Credit Fairness Act.

Version saved on October 2, 2008, 20:00:47, by webmaster:

S. 3259 would amend title 11, United States Code, with respect to the priority of certain high cost credit debts.

Detailed Summary

Consumer Credit Fairness Act - Amends federal bankruptcy law governing equitable subordination of claims in a bankruptcy case to: (1) subordinate a claim arising from a high cost consumer credit transaction to all other claims; and (2) require transfer to the estate in bankruptcy of any lien securing a subordinated claim.

Defines "high cost consumer credit transaction" as an extension of credit by a creditor resulting in a consumer debt with an applicable annual percentage rate (APR), including related costs and fees, that exceeds the lesser of: (1) the sum of 15% and the yield on U.S. Treasury securities having a 30-year period of maturity; or (2) 36%.

Excludes a debtor's petition for relief resulting from a high cost consumer credit transaction from mandatory consideration for dismissal, or conversion to a case under chapter 11 or 13, based upon a finding of substantial abuse.

Status of the Legislation

Latest Major Action: 7/14/2008: Referred to Senate committee. Status: Read twice and referred to the Committee on the Judiciary.

Points in Favor

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Points Against

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