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Safe Harbor for Small Loans: New Rules for Credit Products up to $3,500.

This law amends the Truth in Lending Act to create a "safe harbor" for banks and credit unions offering small-dollar loans (up to $3,500). This protection shields institutions from certain penalties and lawsuits if they strictly follow new consumer protection rules. For citizens, this aims to increase the availability of regulated, safer short-term credit options with mandatory longer repayment periods and strict limits on fees.
Key points
Establishes a maximum loan value of $3,500, requiring repayment over more than 45 days and amortization across multiple payments.
Prohibits financial institutions from charging prepayment penalties, overdraft fees, or nonsufficient funds (NSF) fees related to these specific loans.
Bans "balloon payments," where one payment is more than double the amount of any other required payment.
Institutions cannot roll over the loan into a new product or issue a second loan if the consumer already has one open.
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Expired
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Additional Information
Print number: 118_HR_8356
Sponsor: Rep. Kim, Young [R-CA-40]
Process start date: 2024-05-10
Lustra uses Artificial Intelligence. Verify details in source documents.
Summarized by: gemini-2.5-flash-preview-09-2025
Source data: api.congress.gov
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OFFICIAL LEGAL TITLE

Small Dollar Loan Certainty Act

FREQUENTLY ASKED QUESTIONS

What is the official ID of this bill?

The official print number for this legislation is 118_HR_8356.

Which chamber initiated this legislation?

This legislation was initiated in the House of Representatives.

When did the legislative process begin?

The process officially started on 2024-05-10.

What are the main provisions?

Key points include:

  • Establishes a maximum loan value of $3,500, requiring repayment over more than 45 days and amortization across multiple payments.
  • Prohibits financial institutions from charging prepayment penalties, overdraft fees, or nonsufficient funds (NSF) fees related to these specific loans.
  • Bans "balloon payments," where one payment is more than double the amount of any other required payment.
  • Institutions cannot roll over the loan into a new product or issue a second loan if the consumer already has one open.
What is the specific legal status?

The current status is Expired.

Where can I read the full text of this legislation?

The full official text is available at: View full text

Who is the primary sponsor?

The primary sponsor is Rep. Kim, Young [R-CA-40].

What is the latest detailed status?

The latest detailed status is: Referred to the House Committee on Financial Services.

Is this summary verified?

Yes. This content was analyzed by AI and verified by the Lustra Judge System on 2025-12-25.

CATEGORIES

Economy