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John C.
Democrat MI 13

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  • National Guard and Reservist Debt Relief Extension Act of 2015

    by Representative John Conyers Jr.

    Posted on 2015-12-16

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    CONYERS. Mr. Speaker, I rise in strong support of H.R. 4246, the ``National Guard and Reservist Debt Relief Extension Act of 2015.'' It has been ten years since President Bush signed into law the Bankruptcy Abuse Prevention and Consumer Protection Act, a bill that made numerous amendments to the Bankruptcy Code, many of which pertained to consumer debtors.

    In particular, the Act established a means test mechanism-- purportedly intended to determine a debtor's ability to repay debts-- that requires a presumption of abuse if the debtor has income in excess of specified thresholds.

    H.R. 4246 would continue the current exemption from this presumption for certain qualifying National Guard members and reserve component members of the Armed Services.

    This exemption, which was first enacted in 2008 on a bipartisan basis, is due to expire in just a few days on December 19th.

    H.R. 4246 recognizes that some of those who serve in the military encounter financial difficulties during or in the wake of their service and that they merit relief from the additional proof requirements of the means test.

    In fact, servicemembers are often targeted by unscrupulous lenders. As reported by the Wall Street Journal earlier this year, payday lenders prey on service members and their families at twice the rate that they use to target civilians.

    These short-term, high-interest loans are often used to provide small amounts of money to pay for unexpected or emergency expenditures or to obtain advances on tax refunds.

    Yet, as a result of excessive interest rates, these loans can quickly balloon into overwhelming debt obligations. According to the Journal, some servicemembers have paid as much as 600 percent to 700 percent for the life of their loans, or even four times the amount of the original loan.

    In 2013, about 11 percent of enlisted personnel in the active duty military obtained payday loans, which included vehicle title loans, pawnshop loans, and other high-interest loans.

    So, at least for those servicemembers who seek bankruptcy protection in response to financial distress, H.R. 4246 ensures that they are exempted from the presumption of abuse if he or she is on active duty or is performing a homeland defense activity for a specified period.

    I commend the gentleman from Tennessee, Steve Cohen, for his leadership on this legislation and for his enduring commitment to our Nation's servicemembers.

    Accordingly, I urge my colleagues on both sides of the aisle to join me in supporting H.R. 4246.

    The SPEAKER pro tempore. The question is on the motion offered by the gentleman from Virginia (Mr. Goodlatte) that the House suspend the rules and pass the bill, H.R. 4246.

    The question was taken.

    The SPEAKER pro tempore. In the opinion of the Chair, two-thirds being in the affirmative, the ayes have it.

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