Senate Committee approves Senate Bill 145 for vehicle and household installment contracts

Senate Bill 145, aimed at updating vehicle retail installment contracts, received unanimous support during the Kentucky Senate Standing Committee on Banking & Insurance meeting on February 25, 2025. Senator Givens presented the bill, which seeks to align fees for non-vehicle retail installment contracts, such as those for furniture and appliances, with existing vehicle contract regulations.

Currently, the law allows lenders to begin enforcing collections on vehicle installment contracts after 30 days of delinquency. The proposed changes would raise fees for non-vehicle contracts from $10 to $15, a figure that has remained unchanged since 1996. This adjustment is intended to provide clarity and fairness in the installment loan process, particularly for low-value items.

During the discussion, committee members expressed their support while also voicing concerns about the potential impact on consumers, especially regarding delinquency on household goods. Senator Chambers Armstrong highlighted her apprehension but ultimately trusted Senator Givens' thoughtful approach to the issue.

The bill passed with all members voting in favor, signaling a commitment to modernizing Kentucky's installment loan framework. The committee concluded the session without further business, marking a significant step forward in consumer protection and financial regulation in the state.