101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB3514

 

Introduced 2/14/2020, by Sen. Elgie R. Sims, Jr.

 

SYNOPSIS AS INTRODUCED:
 
See Index

    Amends the Consumer Installment Loan Act. Provides that an income share agreement provider shall clearly and conspicuously disclose specified information in an income-based financing transaction no later than 3 business days before the consummation of the transaction. Requires an income share agreement provider to disclose a borrower's effective annual percentage rate under specified scenarios. Requires an income share agreement provider to provide a borrower with a monthly statement within 15 days before a payment due date, and to provide a borrower with an annual statement. Provides that the contractual payment percentage of an agreement may not exceed 5% of a borrower's qualified income, and no income share agreement term may exceed 60 months. Provides that an income share agreement provider shall not contract for a payment cap that exceeds 1.10 times the amount of the advance or extend an advance that exceeds $5,000. Provides that no payment may be collected under the terms of an income share agreement when a borrower is enrolled in a covered educational program, or during the 6-month grace period after a borrower leaves such a program. Provides that an income share agreement provider shall not engage in unfair or deceptive practices toward a borrower or misrepresent or omit any material information in connection with an income-based financing transaction. Provides that a borrower must exhaust all sources of federal student loans and state grants for which the borrower is directly eligible before entering into an educational income share agreement. Requires an income share agreement provider to provide readily accessible methods for consumers to submit a request for assistance to the provider, and to implement a process by which a borrower can escalate any request for assistance. Makes other changes. Defines terms.


LRB101 17539 BMS 66955 b

 

 

A BILL FOR

 

SB3514LRB101 17539 BMS 66955 b

1    AN ACT concerning regulation.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 1. This Act may be referred to as the Income Share
5Agreement Consumer Protection Act.
 
6    Section 5. The Consumer Installment Loan Act is amended by
7adding Sections 17.6, 17.7, 17.8, 17.9, 17.10, 17.11, 17.12,
817.13, 17.14, 17.15, 17.16, 17.17, 17.18, 17.19, 17.20, 17.21,
917.22, 17.23, 17.24, 17.25, 17.26, and 17.27 as follows:
 
10    (205 ILCS 670/17.6 new)
11    Sec. 17.6. Income share agreements; scope and definitions.
12    (a) Sections 17.7 through 17.27 of this Act apply
13exclusively to income share agreements as defined in subsection
14(b).
15    (b) As used in Sections 17.7 through 17.27:
16    "Advance" means the amount of money or tuition that is
17credited or paid to or on behalf of the borrower in exchange
18for a contractual payment percentage.
19    "Annual percentage rate" means the percentage rate
20calculated according to the Federal Reserve Board's
21methodology as set forth under Regulation Z, 12 CFR Part 1026.
22    "Bona fide payment event" means a period during which a

 

 

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1borrower is earning income less than the income threshold
2amount. A bona fide payment event constitutes a qualifying
3payment.
4    "Borrower" means the obligor of an income share agreement.
5    "Calculated monthly payment" means the amount of money an
6income share agreement provider determines is due from a
7borrower's qualified income according to the terms of a
8contractual payment percentage.
9    "Cash price" has the meaning given to that term in 12 CFR
101026.2(a)(9).
11    "Contractual payment percentage" means the share or
12percentage of qualified income a borrower is required to pay
13pursuant to the terms of an income share agreement.
14    "Covered educational program" means a federally eligible
15educational program or vocational educational program.
16    "Educational expenses" means tuition, fees, and other
17related expenses for a borrower to enroll in or attend a
18covered educational program.
19    "Eligible education debt" means federal education loans,
20private education loans, and income share agreements.
21    "Educational income share agreement" means an income share
22agreement offered in whole or in part to finance educational
23expenses.
24    "Federally eligible educational program" means a college,
25university, trade school, or other post-secondary educational
26institution eligible to participate in a student aid program

 

 

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1run by the United States Department of Education.
2    "Grace period" means the period after the income share
3agreement is entered and before the start of the repayment
4period.
5    "Income share agreement" means an agreement under which a
6borrower commits to pay a percentage of his or her future
7income in exchange for money, payments, or credits applied to
8or on behalf of a borrower. An income share agreement
9constitutes a loan and debt within the meaning of this Act.
10    "Income-based financing transaction" means a transaction
11repaid by a borrower pursuant to the terms of an income share
12agreement.
13    "Income share agreement provider" means:
14        (1) a person that directly or indirectly provides
15    money, payments, or credits to or on behalf of a borrower
16    pursuant to the terms of an income share agreement;
17        (2) a person that participates in the creation or
18    administration of an income share agreement, including by:
19            (A) providing, originating, or underwriting
20        services or assistance;
21            (B) calculating, collecting, or processing
22        payments;
23            (C) collecting income from any source;
24            (D) arranging one or more income-based financing
25        transactions; or
26            (E) performing any other administrative service

 

 

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1        pursuant to the terms of an income share agreement; or
2        (3) an assignee or recipient of the proceeds of an
3    income share agreement.
4    "Income documentation" means evidence of a borrower's
5income used to determine qualified income.
6    "Income threshold" means 250% of the federal poverty
7guidelines for the family size of the borrower, as updated
8periodically in the Federal Register by the U.S. Department of
9Health and Human Services under the authority of 42 U.S.C.
109902(2).
11    "Maximum payment term" means the maximum time in months it
12takes for an income share agreement to be repaid and completely
13satisfied.
14    "Maximum required payments" means the total number of
15qualifying payments a borrower must make to fully satisfy an
16income share agreement.
17    "Payment cap" means the maximum amount of money a borrower
18must pay to satisfy the terms of an income share agreement.
19    "Qualified income" means that part of the borrower's
20compensation (including, but not limited to, salary, bonuses,
21commissions, and vacation pay) from an employer remaining after
22the deduction of health insurance premiums and any amounts
23required by law to be withheld. As used in this definition,
24"amounts required by law to be withheld" include amounts for
25deductions such as Social Security taxes and withholding taxes,
26but do not include any amounts withheld pursuant to a court

 

 

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1order.
2    "Qualifying payment" means a calculated monthly payment
3that counts toward the payment cap or maximum payment term.
4    "Repayment period" means the time after which the income
5share agreement provider calculates or collects a borrower's
6qualifying payment.
7    "Request for assistance" means any inquiry, complaint,
8account dispute, or request for documentation an income share
9agreement provider receives from a borrower.
10    "Vocational educational program" means any post-secondary
11training program or other program that is designed or marketed
12to increase the individual's human capital, employability, or
13earning potential, and is not eligible to participate in a
14student aid program run by the United States Department of
15Education.
 
16    (205 ILCS 670/17.7 new)
17    Sec. 17.7. Income share agreements; disclosure of terms.
18    (a) In an income-based financing transaction under this
19Act, the income share agreement provider must clearly and
20conspicuously disclose the following:
21        (1) the income share agreement provider making the
22    disclosures;
23        (2) the amount advanced;
24        (3) the contractual payment percentage;
25        (4) the maximum required payments;

 

 

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1        (5) the maximum term;
2        (6) the threshold amount;
3        (7) the payment cap;
4        (8) a statement that the borrower's estimated annual
5    percentage rates are illustrations of what may occur and
6    not guarantees of what will occur;
7        (9) a description and breakdown of the fees charged at
8    the time of origination;
9        (10) the annual percentage rate disclosed in a manner
10    as set forth under Section 17.8;
11        (11) the definition of qualifying income;
12        (12) the date repayment will begin;
13        (13) a statement that the borrower's monthly payment
14    may vary in proportion to his or her future income;
15        (14) the procedure for verifying a borrower's
16    qualifying income;
17        (15) the conditions under which a borrower may
18    experience an increase in payment, including a detailed
19    description of the methodology by which such payment will
20    be calculated;
21        (16) the applicable grace period;
22        (17) the applicable terms of deferments;
23        (18) a schedule of fees a borrower is subject to after
24    the commencement of the transaction;
25        (19) information about applicable credit reporting
26    practices;

 

 

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1        (20) the prepayment methodology set forth under
2    Section 17.17;
3        (21) the terms under which the borrower may be
4    considered in default;
5        (22) the borrower's rights with respect to:
6            (A) filing a dispute;
7            (B) delinquency or default;
8            (C) overpayment or underpayment;
9            (D) disability;
10            (E) borrower death;
11            (F) service as a member of the armed services,
12        including the National Guard and Reserves; and
13            (G) closed school discharge.
14        (23) a statement that the income share agreement
15    represents the obligation of the borrower to pay a specific
16    percentage of his or her income and does not give the
17    income share agreement provider any rights regarding the
18    borrower's educational or employment pursuits; and
19        (24) an address and telephone number where a borrower
20    can submit a request for assistance.
21    (b) In an income-based financing transaction consisting of
22an educational income share agreement, the income share
23agreement provider shall disclose the following terms in
24addition to those set forth under subsection (a):
25        (1) a statement, when applicable, that a borrower must
26    exhaust all sources of federal student loans and state

 

 

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1    grants for which the borrower is directly eligible before
2    entering into an income share agreement;
3        (2) the consequences of failing to complete an
4    educational program; and
5        (3) the cash price of tuition.
6    (c) The income share agreement provider shall ensure the
7consumer receives the disclosures required under this Section
8no later than 3 business days before the consummation of the
9transaction.
10    (d) If one of the disclosures provided under subsection (a)
11becomes inaccurate due to an increase in annual percentage rate
12or other cost to the consumer before the consummation of the
13transaction, the income share agreement provider shall ensure
14that the consumer receives corrected disclosures containing
15all changed terms in accordance with the requirements of
16Sections 17.7 through 17.27.
17    (e) If any disclosures required under this Section are not
18provided to the consumer in person, the consumer is considered
19to have received the disclosures 3 business days after they are
20delivered or placed in the United States mail. As used in this
21subsection, "business day" means all calendar days except
22Sundays and legal public holidays.
 
23    (205 ILCS 670/17.8 new)
24    Sec. 17.8. Income share agreements; income-based
25financing; estimated annual percentage rate.

 

 

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1    (a) An income share agreement provider shall disclose a
2borrower's effective annual percentage rate by using the
3Federal Reserve Board's annual percentage rate calculation as
4set forth in Regulation Z, 12 CFR Part 1026, based on the
5following scenarios:
6        (1) the borrower's income stays constant throughout
7    the term of the income share agreement;
8        (2) the borrower's income is 50% less than expected at
9    the outset of the agreement and continues through the term
10    at this reduced income rate; and
11        (3) the borrower's income is 50% more than expected at
12    the outset of the agreement and continues through the term
13    at this increased income rate.
14    (b) The figure calculated under this Section shall:
15        (1) assume 12 qualifying payments are received at the
16    contractual payment percentage; and
17        (2) include any grace period.
18    (c) The estimated income projection as stated in paragraph
19(1) of subsection (a) shall be calculated using the best
20information reasonably available to the income share agreement
21provider.
22    (d) An income share agreement provider shall retain data
23and documentation sufficient to demonstrate the manner and
24methodology used to estimate a borrower's annual percentage
25rate under this Section.
 

 

 

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1    (205 ILCS 670/17.9 new)
2    Sec. 17.9. Income share agreements; periodic monthly
3statement. An income share agreement provider shall provide a
4borrower with a monthly statement within 15 days before a
5payment due date that clearly and conspicuously discloses:
6        (1) the amount of the calculated monthly payment;
7        (2) the amount of a qualifying monthly payment;
8        (3) the due date of the monthly payment;
9        (4) the number of qualifying payments received;
10        (5) the dollar total of qualifying payments;
11        (6) the number of payments remaining toward the maximum
12    qualifying payments;
13        (7) the dollar amount remaining toward the
14    satisfaction of the payment cap;
15        (8) a description of the information relied on to
16    determine the borrower's calculated monthly payment;
17        (9) a statement regarding a borrower's rights with
18    respect to filing a dispute and contact information for a
19    borrower to submit a request for assistance or dispute to
20    the income share agreement provider; and
21        (10) the income share agreement provider's policies
22    and procedures related to submitting income documentation,
23    including, at minimum:
24            (A) acceptable types and categories of
25        documentation;
26            (B) time within which documentation must be

 

 

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1        received by the income share agreement provider;
2            (C) location and methods for a borrower to submit
3        documentation to the income share agreement provider;
4            (D) the manner in which an income share agreement
5        provider will review a borrower's documentation;
6            (E) the method for a borrower to dispute a
7        determination related to the submission of
8        documentation;
9            (F) third-party vendors the income share agreement
10        providers rely on to determine a borrower's income;
11            (G) any applicable rights to cure a default; and
12            (H) the consequences under the income share
13        agreement for failure to submit income documentation.
 
14    (205 ILCS 670/17.10 new)
15    Sec. 17.10. Income share agreements; annual statement.
16    (a) An income share agreement provider shall provide a
17borrower with an annual statement.
18    (b) The annual statement shall disclose, at minimum:
19        (1) the number of qualifying payments a borrower has
20    made;
21        (2) the number of payments remaining of the maximum
22    required payments;
23        (3) the total dollar amount of payments the borrower
24    has made;
25        (4) the number of months the borrower has experienced a

 

 

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1    bona fide payment event; and
2        (5) contact information for a borrower to submit a
3    request for assistance or dispute to the income share
4    agreement provider.
 
5    (205 ILCS 670/17.11 new)
6    Sec. 17.11. Income share agreements; determination of
7qualified income; borrower protections.
8    (a) An income share agreement provider shall adopt policies
9and procedures concerning the determination of a borrower's
10qualified income.
11    (b) An income share agreement provider shall provide
12readily accessible methods for the borrower to submit a request
13for assistance to the income share agreement provider on a
14matter related to the borrower's payment.
 
15    (205 ILCS 670/17.12 new)
16    Sec. 17.12. Income share agreements; charges permitted.
17    (a) The contractual payment percentage may not exceed 5% of
18a borrower's qualified income.
19    (b) At no time may the percentage of such individual's
20income that the individual has agreed to pay under an
21educational income share agreement and any other eligible
22educational debt exceed 10%.
 
23    (205 ILCS 670/17.13 new)

 

 

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1    Sec. 17.13. Income share agreements; limitation on the
2length of agreements. No income share agreement term may exceed
360 months, including months in which no payment is due because
4of a bona fide payment event.
 
5    (205 ILCS 670/17.14 new)
6    Sec. 17.14. Income share agreements; payment multiplier.
7No income share agreement provider shall contract for a payment
8cap that exceeds 1.10 times the amount of the advance.
 
9    (205 ILCS 670/17.15 new)
10    Sec. 17.15. Income share agreements; advance limit. No
11income share agreement provider shall extend an advance that
12exceeds $5,000.
 
13    (205 ILCS 670/17.16 new)
14    Sec. 17.16. Income share agreements; grace period.
15    (a) No payment may be collected pursuant to the terms of an
16income share agreement:
17        (1) when a borrower is enrolled in a covered
18    educational program; or
19        (2) during the 6-month grace period that begins on the
20    date the borrower graduates or withdraws from or falls
21    below half-time enrollment status in a covered educational
22    program.
23    (b) No educational income share agreement may contain a

 

 

SB3514- 14 -LRB101 17539 BMS 66955 b

1grace period that is less than 6 months.
2    (c) A borrower may voluntarily elect to make qualifying
3payments to an income share agreement provider during a grace
4period.
 
5    (205 ILCS 670/17.17 new)
6    Sec. 17.17. Income share agreements; prepayment. A
7borrower may satisfy an income share agreement before the
8maximum term subject to the following conditions:
9        (1) If a borrower has made qualifying payments in an
10    amount less than the advance, then the borrower may satisfy
11    the income share agreement by paying the difference between
12    the advance and the dollar amount of payments and fees the
13    borrower has made to the income share agreement provider
14    pursuant to the terms of the income share agreement.
15        (2) If a borrower has made qualifying payments in an
16    amount that exceeds the advance, then the borrower may
17    satisfy the income share agreement by paying the difference
18    between the payment cap and the dollar amount of payments
19    and fees the borrower has made to the income share
20    agreement provider pursuant to the terms of the income
21    share agreement.
 
22    (205 ILCS 670/17.18 new)
23    Sec. 17.18. Income share agreements; prohibitions.
24    (a) An income share agreement provider shall not engage in

 

 

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1unfair or deceptive practices toward a borrower or misrepresent
2or omit material information in connection with an income-based
3financing transaction, including, but not limited to:
4misrepresenting the amount, nature, or terms of a fee or
5payment due or claimed to be due on an income share agreement;
6the terms and conditions of the income share agreement; the
7terms of a repayment plan; or the borrower's obligations under
8the income share agreement.
9    (b) An income share agreement provider may not misapply or
10miscredit payments made by a borrower pursuant to the terms of
11an income share agreement.
12    (c) An income share agreement shall oversee third parties,
13including subservicers, debt collectors, independent
14contractors, subsidiaries, affiliates, or other agents, to
15ensure that those companies comply with this Act when working
16on behalf of the income share agreement provider.
17    (d) No payment shall be due or otherwise collected from a
18borrower pursuant to the terms of an income share agreement if
19a borrower has a bona fide payment event.
20    (e) No income share agreement provider may make any written
21or verbal statement regarding a borrower's estimated income
22that is false or misleading.
23    (f) A borrower must exhaust all sources of federal student
24loans and state grants for which the borrower is directly
25eligible before entering into an educational income share
26agreement if the borrower is eligible for such funding. The

 

 

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1income share agreement provider shall verify whether a borrower
2has exhausted applicable funding.
3    (g) If an income share agreement provider declares a
4borrower in default, including due to missing or delayed income
5documentation, such provider may not take additional
6collection action or otherwise impose a penalty unless the
7borrower is given the opportunity to cure the default.
8    (h) No income share agreement may contain provisions
9related to:
10        (1) confessions of judgment;
11        (2) assignment of wages; or
12        (3) prejudgment attachment.
13    (i) No income share agreement shall provide for any rights
14regarding the borrower's educational or employment pursuits.
15    (j) An income share agreement provider shall comply with
16the requirements of the Fair Credit Reporting Act.
 
17    (205 ILCS 670/17.19 new)
18    Sec. 17.19. Income share agreements payment processing.
19    (a) An income share agreement provider shall credit
20borrower payments promptly and accurately.
21    (b) An income share agreement provider shall provide
22borrowers with prompt notice if the income share agreement
23provider changes the address to which the borrower needs to
24send payments.
 

 

 

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1    (205 ILCS 670/17.20 new)
2    Sec. 17.20. Income share agreements fees.
3    (a) Unless otherwise provided by federal law, an income
4share agreement provider may only charge late fees that are
5reasonable and proportional to the cost it incurs related to a
6late payment.
7    (b) Unless otherwise provided by federal law, an income
8share agreement provider may not charge a borrower or cosigner
9any fee to modify, defer, forbear, renew, extend, or amend the
10borrower's income share agreement.
 
11    (205 ILCS 670/17.21 new)
12    Sec. 17.21. Income share agreements; discrimination
13prohibited. It is unlawful for any income share agreement
14provider to discriminate against a borrower with respect to an
15aspect of an income share agreement or income-based financing
16transaction:
17        (1) on the basis of race, color, religion, national
18    origin, immigration status, sex, gender identity, sexual
19    orientation, marital status, or age (provided the
20    applicant has the capacity to contract);
21        (2) because all or part of the applicant's income
22    derives from a public assistance program; or
23        (3) because the applicant has in good faith exercised a
24    right under this Act.
 

 

 

SB3514- 18 -LRB101 17539 BMS 66955 b

1    (205 ILCS 670/17.22 new)
2    Sec. 17.22. Income share agreements; conflicts of
3interest. An educational income-based agreement provider may
4not, directly or indirectly:
5        (1) offer or provide a gift to a covered educational
6    program in exchange for an advantage or consideration
7    provided to such income share agreement provider related to
8    its income-based financing transactions; or
9        (2) engage in revenue sharing with a covered
10    educational program.
 
11    (205 ILCS 670/17.23 new)
12    Sec. 17.23. Income share agreements; bankruptcy. The
13provisions of this Act with respect to the treatment of income
14share agreements under Illinois law may not be construed to
15qualify such agreements as qualified education loans under 26
16U.S.C. 221(d)(1) or debt that is excepted from discharge under
1711 U.S.C. 523.
 
18    (205 ILCS 670/17.24 new)
19    Sec. 17.24. Income share agreements; cancellation and
20discharge. An income share agreement shall be void if:
21        (1) a borrower receives a determination from the Social
22    Security Administration that he or she is totally and
23    permanently disabled;
24        (2) a borrower is determined by the Secretary of

 

 

SB3514- 19 -LRB101 17539 BMS 66955 b

1    Veterans Affairs to be unemployable due to a
2    service-related disability;
3        (3) a borrower dies; or
4        (4) a borrower's covered educational program closes
5    prior to the borrower completing the program.
 
6    (205 ILCS 670/17.25 new)
7    Sec. 17.25. Requests for assistance; account dispute
8resolution; appeals.
9    (a) An income share agreement provider shall implement
10reasonable policies and procedures for accepting, processing,
11investigating, and responding to requests for assistance in a
12timely and effective manner, including, but not limited to, the
13following requirements:
14        (1) An income share agreement provider shall provide
15    readily accessible methods for consumers to submit a
16    request for assistance to the income share agreement
17    provider, including such methods as phone, email, and
18    United States mail.
19        (2) An income share agreement provider shall post on
20    its website and disclose on its billing statements:
21            (A) the toll-free telephone number, email address,
22        and mailing address for consumers to submit a request
23        for assistance to the income share agreement provider;
24        and
25            (B) the procedures for a borrower to send a written

 

 

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1        communication to the income share agreement provider
2        regarding any request for assistance.
3        (3) For any request for assistance that includes a
4    request for documentation or information where a response
5    cannot be immediately provided, an income share agreement
6    provider shall provide the requested documentation or
7    information to the borrower within 14 calendar days after
8    the request; if an income share agreement provider
9    determines in good faith that it is unable to provide the
10    documentation or information within 14 calendar days,
11    promptly after making that determination the income share
12    agreement provider shall notify the borrower of the
13    expected response period, which must be reasonable for the
14    request for assistance.
15    (b) An income share agreement provider shall implement a
16process by which a borrower can escalate any request for
17assistance. Such process shall allow a borrower who has made a
18request for assistance on the phone and who receives a response
19during the call to obtain immediate review of the response by
20an employee of the income share agreement provider at a higher
21supervisory level.
22    (c) The following requirements shall apply when a borrower
23submits a written or oral request for assistance that contains
24an account dispute to an income share agreement provider:
25        (1) Within 14 calendar days after its receipt of the
26    written communication or oral request for further

 

 

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1    escalation, an income share agreement provider shall
2    attempt to make contact with the borrower, including
3    providing the borrower with name and contact information of
4    the representative handling the account dispute, by phone
5    or in writing, and shall document such attempt in the
6    borrower's account.
7        (2) An income share agreement provider shall complete
8    the following actions within 30 calendar days after its
9    receipt of the written communication or oral request for
10    further escalation, subject to paragraph (3) of this
11    subsection:
12            (A) conduct a thorough investigation of the
13        account dispute;
14            (B) make all appropriate corrections to the
15        account of the borrower, including crediting any late
16        fees assessed and derogatory credit furnishing as the
17        result of any error, and if any corrections are made,
18        sending the borrower a written notification that
19        includes the following information:
20                (i) an explanation of the correction or
21            corrections to the borrower's account that have
22            been made; and
23                (ii) the toll-free telephone number, email
24            address, and mailing address of the income share
25            agreement provider's personnel knowledgeable about
26            the investigation and resolution of the account

 

 

SB3514- 22 -LRB101 17539 BMS 66955 b

1            dispute.
2        (3) If an income share agreement provider determines in
3    good faith that it cannot complete a thorough investigation
4    of the account dispute within 30 calendar days after
5    receiving the written communication or oral request for
6    further escalation regarding the account dispute, then
7    promptly after making that determination the income share
8    agreement provider shall notify the borrower of the
9    expected resolution time period, which must be reasonable
10    for the account dispute. An income share agreement provider
11    must complete the actions listed in this subsection within
12    this time period.
13        (4) If an income share agreement provider determines as
14    a result of its investigation that the requested changes to
15    a borrower's dispute will not be made, the income share
16    agreement provider shall provide the borrower with a
17    written notification that includes the following
18    information:
19            (A) a description of its determination and an
20        explanation of the reasons for that determination;
21            (B) the toll-free telephone number, email address,
22        and mailing address of the income share agreement
23        provider's personnel knowledgeable about the
24        investigation and resolution of the account dispute;
25            (C) instructions about how the borrower can appeal
26        the income share agreement provider's determination in

 

 

SB3514- 23 -LRB101 17539 BMS 66955 b

1        accordance with paragraph (5) of this subsection; and
2            (D) information regarding the method by which a
3        borrower may request copies of documents an income
4        share agreement provider relied on to make a
5        determination that no changes to a borrower's account
6        will be made.
7        (5) After the borrower receives a determination
8    regarding an account dispute in accordance with paragraph
9    (4) of this subsection, the income share agreement provider
10    shall allow a process by which the borrower can appeal, in
11    writing, the determination. The appeals process shall
12    include:
13            (A) a written acknowledgment notifying the
14        borrower that the income share agreement provider has
15        commenced the appeals process; such acknowledgment
16        must be sent within 14 calendar days after receiving a
17        written request for appeal from the borrower;
18            (B) an independent reassessment of the income
19        share agreement provider's determination regarding the
20        account dispute, performed by another employee of the
21        income share agreement provider at an equal or higher
22        supervisory level than the employee or employees
23        involved in the initial account dispute determination;
24            (C) investigation and resolution of appeals within
25        30 calendar days after an income share agreement
26        provider's commencement of the appeals process; and

 

 

SB3514- 24 -LRB101 17539 BMS 66955 b

1            (D) written notification sent to the borrower
2        documenting the outcome of the appeal, including any
3        reason for denial.
4    (d) While a borrower has a pending account dispute,
5including an applicable appeal, an income share agreement
6provider shall take reasonable steps to:
7        (1) prevent negative credit reporting with respect to
8    the borrower's account while the dispute is under review;
9    and
10        (2) suspend all collection activities on the account
11    while the account dispute is being researched or resolved
12    if the account dispute is related to the delinquency.
 
13    (205 ILCS 670/17.26 new)
14    Sec. 17.26. Income share agreements; miscellaneous
15provisions.
16    (a) An agreement, contract, or transaction that is
17willfully structured to evade the definition of an income share
18agreement is deemed an income share agreement for purposes of
19this Act.
20    (b) If there is a conflict between Sections 17.6 through
2117.27 and any other Sections of this Act, Sections 17.6 through
2217.27 shall control.
 
23    (205 ILCS 670/17.27 new)
24    Sec. 17.27. Enforcement of the Consumer Fraud and Deceptive

 

 

SB3514- 25 -LRB101 17539 BMS 66955 b

1Business Practices Act. The Attorney General may enforce a
2violation of Sections 17.7 through 17.27 of this Act as an
3unlawful practice under the Consumer Fraud and Deceptive
4Business Practices Act.

 

 

SB3514- 26 -LRB101 17539 BMS 66955 b

1 INDEX
2 Statutes amended in order of appearance
3    205 ILCS 670/17.6 new
4    205 ILCS 670/17.7 new
5    205 ILCS 670/17.8 new
6    205 ILCS 670/17.9 new
7    205 ILCS 670/17.10 new
8    205 ILCS 670/17.11 new
9    205 ILCS 670/17.12 new
10    205 ILCS 670/17.13 new
11    205 ILCS 670/17.14 new
12    205 ILCS 670/17.15 new
13    205 ILCS 670/17.16 new
14    205 ILCS 670/17.17 new
15    205 ILCS 670/17.18 new
16    205 ILCS 670/17.19 new
17    205 ILCS 670/17.20 new
18    205 ILCS 670/17.21 new
19    205 ILCS 670/17.22 new
20    205 ILCS 670/17.23 new
21    205 ILCS 670/17.24 new
22    205 ILCS 670/17.25 new
23    205 ILCS 670/17.26 new
24    205 ILCS 670/17.27 new