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Rep. Gagnon outlines bridge-loan bill with consumer protections; committee shortens maturity to 12 months
Summary
Representative Gagnon described S.787 to authorize consumer bridge loans for owner-occupied residential acquisition or construction with consumer protections including penalty-free prepayment and a possible 3-month balloon extension. The subcommittee reduced the maximum maturity to 12 months; the full committee favorably reported the bill to the floor by show of hands (tally not specified).
Representative Gagnon told the committee that S.787 would allow bridge loans in South Carolina defined as consumer loans connected to acquisition or construction of residential property intended to be occupied by the borrower. He said stakeholders and the subcommittee crafted consumer protections to prevent predatory lending.
Key protections noted include the borrower's right to prepay at any time without penalty and a subcommittee provision allowing the borrower to extend a balloon payment for up to three months if payments have been timely. Committee discussion clarified that the subcommittee had reduced the statutory maximum maturity from 18 months to 12 months during subcommittee consideration.
Committee member Mr. Hager added that only two states lack this authority and urged passage. Following that exchange, the committee moved, seconded and by show of hands gave S.787 a favorable report to the House floor; the transcript does not record a numeric vote tally.
