Sponsors (3)
The bill would substantially limit high‑cost lending and increase price transparency—benefiting low‑ and middle‑income consumers financially and legally—but at the cost of reduced availability of some small‑dollar credit, higher compliance and enforcement burdens, and potential market disruption.
Low-income and middle-class borrowers would pay less overall because a national 36% cap that combines fees and interest would prohibit many high‑cost payday, title, overdraft and similar products.
Consumers nationwide would receive clearer, standardized fee-and-interest disclosures (APR-style calculations including most fees), making credit costs more directly comparable when shopping for loans or open-end credit.
Borrowers who receive unlawful high-cost charges would have stronger remedies and defenses: creditors must return principal/interest/fees and violations can be raised as defenses to collection actions, improving access to relief.
Workers and other people who rely on quick small‑dollar credit may see these emergency products disappear or become harder to obtain if high‑cost options are outlawed, reducing access to short‑term liquidity.
Banks and nonbank lenders may exit markets or tighten underwriting, meaning higher qualifying standards and reduced credit availability for higher‑risk borrowers.
Steep criminal and civil penalties on creditors and servicers (including jail time and fines) could deter legitimate lenders from offering certain products and raise costs for remaining borrowers or increase taxpayer exposure.
Based on analysis of 4 sections of legislative text.
Imposes a 36% nationwide cap on combined fees and interest for consumer credit, changes disclosures to show a single fee-and-rate, and creates civil and criminal remedies for violations.
Introduced September 11, 2025 by Richard Joseph Durbin · Last progress September 11, 2025
Creates a nationwide cap that stops any consumer loan from charging more than 36% when all fees and interest are added together. It defines which charges count, changes required disclosure language for open-end credit, gives the consumer bureau limited calculation and tolerance authority (but not exemption power), and establishes civil and criminal penalties plus remedies for borrowers when the cap is violated. The law aims to close state-law loopholes and “rate exportation” that let payday, title, overdraft, and some online loans reach triple-digit annual rates. It preserves stronger state protections and gives states limited enforcement tools, while requiring lenders to change how they calculate and show costs to consumers.