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House approves mortgage‑lending bill to curb predatory practices
Summary
Second substitute HB 160, presented by Rep. Wayne Harper, creates a "high‑cost loan" category and tightens rules on prepayment penalties, points and fees, certain insurance and negative amortization; the House passed the bill 65‑0 and it will be sent to the Senate.
The Utah House approved second substitute House Bill 160, a package of mortgage‑lending reforms the sponsor described as targeting predatory lending. The bill passed on a recorded vote of 65‑0 and will be forwarded to the Senate.
Sponsor Rep. Wayne Harper told the chamber the bill addresses a range of practices he and constituents have raised in recent years, including prepayment penalties, limits on points and fees, restrictions on single‑premium credit life insurance, and protections against negative amortization and encouraging default. Harper said the bill creates a limited "high cost" classification for loans defined in the text as those with interest rates about "8% above the Treasury rate in the current month," and aims to provide clearer, complete loan documents to consumers.
Harper said the measure was compiled after reviewing statutes in other states, federal rules such as the Truth in Lending Act, and industry recommendations from entities like Fannie Mae and Freddie Mac, and that the bill had been worked on for roughly a year with stakeholder input.
The bill drew no substantive floor opposition and the sponsor waived closing remarks before the roll call. The House clerk announced the bill had received 65 yes votes and 0 no votes.
What happens next
HB 160 will be sent to the Utah Senate for further consideration. If enacted, sponsors said it would narrow circumstances where higher‑cost mortgage products can be sold and increase disclosure to better protect consumers.
