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Committee advances debt-resolution licensing bill to separate debt-relief providers from credit counselors
Summary
House Bill 743 passed unanimously; the bill modernizes licensure and regulation of debt-resolution providers, separates debt resolution from credit counseling in state law, and preserves a requirement that providers not collect fees until a consumer’s debt resolution is reached and accepted.
The Banking & Consumer Affairs Subcommittee approved House Bill 743 and will send the measure to the Commerce Committee.
Sponsor (Chairman Keaslin) said the bill modernizes licensing and regulation of debt-resolution providers and separates those companies from credit counselors to remove ambiguities that have complicated oversight. The sponsor emphasized that under Tennessee law debt-resolution providers remain barred from charging fees until three conditions are met: a resolution on an account has been reached with the creditor, the consumer has accepted the resolution, and the consumer has made a payment to the creditor toward the resolution.
“The bill will bring Tennessee more in line with the majority of states and, provide improved administration and clarity for consumers,” the sponsor said. The committee adopted two cleanup amendments that consolidated rulemaking authority and removed the word “material” from enforcement language.
The clerk reported a unanimous vote: “Mr. Chairman, you have 7 ayes, 0 nos.” The bill will proceed to Commerce for further consideration. The transcript records an offer to provide a department staff witness if needed but does not include fiscal notes on the record.
