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House approves consumer credit changes, raising late‑fee cap and removing grace period
Summary
House Bill 235 cleared the House 47‑20, eliminating a 10‑day grace period for delinquent credit‑card payments and raising a delinquency fee cap to $35 (or 5% whichever is greater). Sponsors said the change keeps Utah competitive for credit‑industry jobs; opponents warned of consumer harms.
The Utah House voted 47‑20 to pass House Bill 235 on Feb. 20, a measure that removes a previously required 10‑day grace period on delinquent credit‑card payments and raises the maximum delinquency charge to $35 (also capped at 5% of the installment due).
Representative Kevin Esgarne, sponsor of the bill, said the measure helps Utah‑based lenders compete nationally and preserves an important industry in the state that employs thousands. Representative Garn cited national comparisons on the floor: "There are 22 states that have no limits at all and there are 16 states that have higher limits than what we're proposing here today," he said, arguing Utah needed to remain competitive to retain and attract jobs.
Opponents stressed consumer protections, proposing an amendment to lower the cap to $25 and complaining that removing the 10‑day grace period would let issuers charge late fees immediately after midnight. That amendment failed on the floor after debate; members also disclosed potential conflicts of interest where applicable.
The bill passed and will be transmitted to the Senate for further consideration. Supporters said the bill balances market competition and consumer protection by retaining a 5% cap, while critics said the change risks heavier costs for consumers who miss payments by small margins.
Next steps: HB235 will go to the Senate; members who opposed the measure signaled intent to press for consumer protections in later consideration or committee review.
