Title: Consumer Relief during COVID–19 Act
Policy area: Finance and Financial Sector

Summary:
Consumer Relief during COVID-19 Act
This bill places restrictions on the collection of consumer debts during the COVID-19 (i.e., coronavirus disease 2019) emergency period and for 120 days after this period. Among other things, debt collectors may not during this period
After this period, debt collectors must provide certain repayment options including extending the repayment period for debts.
The bill also provides for forbearance programs established by creditors for consumers experiencing a financial hardship due to COVID-19. The Federal Reserve Board must establish a credit facility to make long-term, low-cost loans to these creditors for losses caused by any forbearance of payments.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7796 Introduced in House (IH)]

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116th CONGRESS
  2d Session
                                H. R. 7796

To amend the Fair Debt Collection Practices Act to restrict collections 
of consumer debt during a national disaster or emergency, and for other 
                               purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             July 27, 2020

Mrs. Beatty (for herself and Ms. Waters) introduced the following bill; 
       which was referred to the Committee on Financial Services

_______________________________________________________________________

                                 A BILL


 
To amend the Fair Debt Collection Practices Act to restrict collections 
of consumer debt during a national disaster or emergency, and for other 
                               purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Consumer Relief during COVID-19 
Act''.

SEC. 2. RESTRICTIONS ON COLLECTIONS OF CONSUMER DEBT DURING A NATIONAL 
              DISASTER OR EMERGENCY.

    (a) In General.--The Fair Debt Collection Practices Act (15 U.S.C. 
1692 et seq.) is amended by inserting after section 812 (15 U.S.C. 
1692j) the following:
``Sec. 812A. Restrictions on collections of consumer debt during a 
              national disaster or emergency
    ``(a) Definitions.--In this section:
            ``(1) Covered period.--The term `covered period' means the 
        period beginning on the date of enactment of this section and 
        ending 120 days after the end of the incident period for the 
        emergency declared on March 13, 2020, by the President under 
        section 501 of the Robert T. Stafford Disaster Relief and 
        Emergency Assistance Act (42 U.S.C. 4121 et seq.) relating to 
        the Coronavirus Disease 2019 (COVID-19) pandemic.
            ``(2) Creditor.--The term `creditor' means any person--
                    ``(A) who offers or extends credit creating a debt 
                or to whom a debt is owed; or
                    ``(B) to whom any obligation for payment is owed.
            ``(3) Debt.--The term `debt'--
                    ``(A) means any obligation or alleged obligation 
                that is or during the covered period becomes past due, 
                other than an obligation arising out of a credit 
                agreement entered into after the effective date of this 
                section, that arises out of a transaction with a 
                consumer; and
                    ``(B) does not include a mortgage loan.
            ``(4) Debt collector.--The term `debt collector' means a 
        creditor and any other person or entity that engages in the 
        collection of debt, including the Federal Government and a 
        State government, irrespective of whether the applicable debt 
        is allegedly owed to or assigned to such creditor, person, or 
        entity.
            ``(5) Mortgage loan.--The term `mortgage loan' means a 
        Federally backed mortgage loan (as defined under section 4022 
        of the CARES Act) and a Federally backed multifamily mortgage 
        loan (as defined under section 4023 of the CARES Act).
    ``(b) Prohibitions.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, no debt collector may, during a covered period--
                    ``(A) enforce a security interest securing a debt 
                through repossession, limitation of use, or 
                foreclosure;
                    ``(B) take or threaten to take any action to 
                deprive an individual of their liberty as a result of 
                nonpayment of or nonappearance at any hearing relating 
                to an obligation owed by a consumer;
                    ``(C) collect any debt, by way of garnishment, 
                attachment, assignment, deduction, offset, or other 
                seizure, from--
                            ``(i) wages, income, benefits, bank, 
                        prepaid or other asset accounts; or
                            ``(ii) any assets of, or other amounts due 
                        to, a consumer;
                    ``(D) commence or continue an action to evict a 
                consumer from real or personal property for nonpayment;
                    ``(E) disconnect or terminate service from a 
                utility service, including electricity, natural gas, 
                telecommunications or broadband, water, or sewer, for 
                nonpayment; or
                    ``(F) threaten to take any of the foregoing 
                actions.
            ``(2) Rule of construction.--Nothing in this section may be 
        construed to prohibit a consumer from voluntarily paying, in 
        whole or in part, a debt.
    ``(c) Limitation on Fees and Interest.--After the expiration of a 
covered period, a debt collector may not add to any past due debt any 
interest on unpaid interest, higher rate of interest triggered by the 
nonpayment of the debt, or fee triggered prior to the expiration of the 
covered period by the nonpayment of the debt.
    ``(e) Violations.--Any person or government entity that violates 
this section shall be liable to the applicable consumer as provided 
under section 813, except that, for purposes of applying section 813--
            ``(1) such person or government entity shall be deemed a 
        debt collector, as such term is defined for purposes of section 
        813; and
            ``(2) each dollar figure in such section shall be deemed to 
        be 10 times the dollar figure specified.
    ``(f) Tolling.--Any applicable time limitations for exercising an 
action prohibited under subsection (b) shall be tolled during a covered 
period.
    ``(g) Predispute Arbitration Agreements.--Notwithstanding any other 
provision of law, no predispute arbitration agreement or predispute 
joint-action waiver shall be valid or enforceable with respect to a 
dispute brought under this section, including a dispute as to the 
applicability of this section, which shall be determined under Federal 
law.''.
    (b) Clerical Amendment.--The table of contents for the Fair Debt 
Collection Practices Act is amended by inserting after the item 
relating to section 812 the following:

``812A. Restrictions on collections of consumer debt during a national 
                            disaster or emergency.''.

SEC. 3. REPAYMENT PERIOD AND FORBEARANCE FOR CONSUMERS.

    Section 812A of the Fair Debt Collection Practices Act (15 U.S.C. 
1692 et seq.), as added by section 2, is amended--
            (1) by inserting after subsection (c) the following:
    ``(d) Repayment Period.--After the expiration of a covered period, 
a debt collector shall comply with the following:
            ``(1) Debt arising from credit with a defined payment 
        period.--For any debt arising from credit with a defined term, 
        the debt collector shall extend the time period to repay any 
        past due balance of the debt by--
                    ``(A) 1 payment period for each payment that a 
                consumer missed during the covered period, with the 
                payments due in the same amounts and at the same 
                intervals as the pre-existing payment schedule; and
                    ``(B) 1 payment period in addition to the payment 
                periods described under subparagraph (A).
            ``(2) Debt arising from an open end credit plan.--For debt 
        arising from an open end credit plan, as defined in section 103 
        of the Truth in Lending Act (15 U.S.C. 1602), the debt 
        collector shall allow the consumer to repay the past-due 
        balance in a manner that does not exceed the amounts permitted 
        by the methods described in section 171(c) of the Truth in 
        Lending Act (15 U.S.C. 1666i-1(c)) and regulations promulgated 
        under that section.
            ``(3) Debt arising from other credit.--
                    ``(A) In general.--For debt not described under 
                paragraph (2) or (3), the debt collector shall--
                            ``(i) allow the consumer to repay the past-
                        due balance of the debt in substantially equal 
                        payments over time; and
                            ``(ii) provide the consumer with--
                                    ``(I) for past due balances of 
                                $2,000 or less, 12 months to repay, or 
                                such longer period as the debt 
                                collector may allow;
                                    ``(II) for past due balances 
                                between $2,001 and $5,000, 24 months to 
                                repay, or such longer period as the 
                                debt collector may allow; or
                                    ``(III) for past due balances 
                                greater than $5,000, 36 months to 
                                repay, or such longer period as the 
                                debt collector may allow.
                    ``(B) Additional protections.--The Director of the 
                Bureau may issue rules to provide greater repayment 
                protections to consumers with debts described under 
                subparagraph (A).
                    ``(C) Relation to state law.--This paragraph shall 
                not preempt any State law that provides for greater 
                consumer protections than this paragraph.''; and
            (2) by adding at the end the following:
    ``(h) Forbearance for Affected Consumers.--
            ``(1) Forbearance program.--Each debt collector that makes 
        use of the credit facility described in paragraph (4) shall 
        establish a forbearance program for debts available during the 
        covered period.
            ``(2) Automatic grant of forbearance upon request.--Under a 
        forbearance program required under paragraph (1), upon the 
        request of a consumer experiencing a financial hardship due, 
        directly or indirectly, to COVID-19, the debt collector shall 
        grant a forbearance on payment of debt for such time as needed 
        until the end of the covered period, with no additional 
        documentation required other than the borrower's attestation to 
        a financial hardship caused by COVID-19 and with no fees, 
        penalties, or interest (beyond the amounts scheduled or 
        calculated as if the borrower made all contractual payments on 
        time and in full under the terms of the loan contract) charged 
        to the borrower in connection with the forbearance.
            ``(3) Exception for certain mortgage loans subject to the 
        cares act.--This subsection shall not apply to a mortgage loan 
        subject to section 4022 or 4023 of the CARES Act.''.

SEC. 4. CREDIT FACILITY.

    Section 812A(h) of the Fair Debt Collection Practices Act (15 
U.S.C. 1692 et seq.), as added by section 3, is amended by adding at 
the end the following:
            ``(4) Credit facility.--The Board of Governors of the 
        Federal Reserve System shall--
                    ``(A) establish a facility, using amounts made 
                available under section 4003(b)(4) of the CARES Act (15 
                U.S.C. 9042(b)(4)), to make long-term, low-cost loans 
                to debt collectors to temporarily compensate such debt 
                collectors for documented financial losses caused by 
                forbearance of debt payments under this subsection; and
                    ``(B) defer debt collectors' required payments on 
                such loans until after consumers' debt payments 
                resume.''.
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