Relating to debt management programs, services, fees, and licensee requirements

Under the bill, a licensee shall maintain a separate bank account or dedicated account for such purpose. _____ based on a model which requires a licensee to receive money or evidences thereof from the debtor to distribute to the debtor’s creditors the debtor shall maintain full control of and access to any moneys set aside for payment to creditors, and the licensee may not receive consideration from any third party in connection with services rendered to a debtor. The bill eliminates the prohibition on a licensee receiving consideration from a third party in connection with services rendered to a debtor.9(4). Under the bill, a licensee may not request or receive payment of a fee for services unless: (1) the licensee has renegotiated, resolved, reduced, or otherwise altered the terms of a debt pursuant to a resolution agreement or other contractual agreement between the debtor and the creditor; (2) the debtor has made at least one payment pursuant to the agreement; and (3) to the extent that debts enrolled in a service are renegotiated, resolved, reduced, or otherwise altered individually, the fee or consideration for the service bears the same proportional relationship to the total fee for altering the terms of the entire debt balance as the individual debt amount bears to the entire debt amount as owed at the time the debt was enrolled in the service, and the same percent is charged for each individual debt enrolled in the program. Under the bill, a person licensed to provide debt management services is exempt from Code chapter 538A (credit services organizations).9(5) (fee agreed in advance).