H.F. 2326 Section 1. Section 533A.8, subsection 5, paragraph a, Code 1 2026, is amended to read as follows: 2 a. Maintain a separate bank trust account or dedicated 3 account in which all payments received from debtors for the 4 benefit of creditors shall be deposited and in which all 5 payments shall remain until a remittance is made to either the 6 debtor or the creditor. 7 Sec. 2. Section 533A.8, subsection 5, paragraph d, Code 8 2026, is amended by striking the paragraph. 9 Sec. 3. Section 533A.8, subsection 6, Code 2026, is amended 10 to read as follows: 11 6. If the debt management program is not based on a model 12 which requires the licensee or any licensee to receive money or 13 evidences thereof from the debtor to distribute to the debtor’s 14 creditors , both of the following shall apply: 15 a. The the debtor shall maintain full control of and access 16 to any moneys set aside for payment to creditors. 17 b. The licensee may not receive consideration from any third 18 party in connection with services rendered to a debtor. 19 Sec. 4. Section 533A.9, subsection 4, Code 2026, is amended 20 by striking the subsection and inserting in lieu thereof the 21 following: 22 4. If a debt management program is not based on a model that 23 requires the licensee or another licensee to receive money or 24 evidences thereof from the debtor to distribute to the debtor’s 25 creditors, a licensee may not request or receive payment of 26 any fee or consideration for debt management services provided 27 under a debt management program unless all of the following are 28 true: 29 a. The licensee has renegotiated, resolved, reduced, or 30 otherwise altered the terms of at least one debt pursuant to a 31 resolution agreement or other contractual agreement executed 32 by the debtor and the creditor. 33 b. The debtor has made at least one payment pursuant to the 34 resolution agreement or other contractual agreement entered 35 -1- LSB 5596HV (1) 91 nls/ko 1/ 3

H.F. 2326 into under paragraph “a” . 1 c. To the extent that debts enrolled in the debt management 2 program are renegotiated, resolved, reduced, or otherwise 3 altered individually, the fee or consideration for the debt 4 management service bears the same proportional relationship to 5 the total fee or consideration for renegotiating, resolving, 6 reducing, or otherwise altering the terms of the entire debt 7 balance as the individual debt amount bears to the entire debt 8 amount. The individual debt amount and the entire debt amount 9 are those owed at the time the debt was enrolled in the debt 10 management program. The percent charged is the same for each 11 individual debt enrolled in the debt management program. 12 Sec. 5. Section 533A.9, subsection 5, Code 2026, is amended 13 by striking the subsection. 14 Sec. 6. Section 538A.2, subsection 2, Code 2026, is amended 15 by adding the following new paragraph: 16 NEW PARAGRAPH . i. A person licensed to engage in the 17 business of debt management under section 533A.2, when acting 18 within the course and scope of that license. 19 EXPLANATION 20 The inclusion of this explanation does not constitute agreement with 21 the explanation’s substance by the members of the general assembly. 22 This bill relates to debt management, services, fees, and 23 licensee requirements. 24 Under current law, if a debt management program (program) is 25 based on a model which requires a licensee to receive money or 26 evidences thereof from a debtor to distribute to the debtor’s 27 creditors, the licensee who receives the money for distribution 28 shall maintain a separate bank trust account in which all 29 payments received from the debtor for the benefit of creditors 30 shall be deposited and shall remain until a remittance is 31 made to either the debtor or the creditor. Under the bill, a 32 licensee shall maintain a separate bank account or dedicated 33 account for such purpose. 34 Under current law, if a debt management program is not 35 -2- LSB 5596HV (1) 91 nls/ko 2/ 3

H.F. 2326 based on a model which requires a licensee to receive money 1 or evidences thereof from the debtor to distribute to the 2 debtor’s creditors the debtor shall maintain full control of 3 and access to any moneys set aside for payment to creditors, 4 and the licensee may not receive consideration from any third 5 party in connection with services rendered to a debtor. The 6 bill eliminates the prohibition on a licensee receiving 7 consideration from a third party in connection with services 8 rendered to a debtor. 9 Under current law, if a program is not based on a model that 10 requires a licensee to receive money or evidences thereof from 11 the debtor to distribute to the debtor’s creditors, a debtor 12 may not be charged a fee exceeding the sum of the initiation 13 fee plus 18 percent of the debtor’s enrolled debts, as detailed 14 in Code section 533A.9(4). Under the bill, a licensee may not 15 request or receive payment of a fee for services unless: (1) 16 the licensee has renegotiated, resolved, reduced, or otherwise 17 altered the terms of a debt pursuant to a resolution agreement 18 or other contractual agreement between the debtor and the 19 creditor; (2) the debtor has made at least one payment pursuant 20 to the agreement; and (3) to the extent that debts enrolled in 21 a service are renegotiated, resolved, reduced, or otherwise 22 altered individually, the fee or consideration for the service 23 bears the same proportional relationship to the total fee for 24 altering the terms of the entire debt balance as the individual 25 debt amount bears to the entire debt amount as owed at the time 26 the debt was enrolled in the service, and the same percent is 27 charged for each individual debt enrolled in the program. 28 Under the bill, a person licensed to provide debt management 29 services is exempt from Code chapter 538A (credit services 30 organizations). 31 The bill strikes Code sections 533A.8(5)(d) (licensee 32 requirements) and 533A.9(5) (fee agreed in advance). 33 -3- LSB 5596HV (1) 91 nls/ko 3/ 3