BILL NUMBER: AB 2476	CHAPTERED
	BILL TEXT

	CHAPTER  101
	FILED WITH SECRETARY OF STATE  JULY 13, 2012
	APPROVED BY GOVERNOR  JULY 13, 2012
	PASSED THE SENATE  JUNE 28, 2012
	PASSED THE ASSEMBLY  MAY 14, 2012

INTRODUCED BY   Committee on Veterans Affairs (Assembly Members Cook
(Chair), Pan (Vice Chair), Atkins, Block, Beth Gaines, Nielsen, V.
Manuel Pérez, and Yamada)

                        FEBRUARY 24, 2012

   An act to amend Section 405 of the Military and Veterans Code,
relating to military service.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2476, Committee on Veterans Affairs. Service member obligations
or liabilities: rate of interest.
   Existing law provides certain legal rights for service members,
including with regard to credit agreements, interest liabilities, and
mortgages and trusts. Existing law prohibits an obligation or
liability bearing interest at a rate in excess of 6% per year
incurred by a service member before that person's entry into service
from bearing interest at a rate in excess of 6% per year during any
part of the period of military service, except as prescribed.
Existing law provides that a person who violates this rate of
interest provision is liable for actual damages, reasonable attorney'
s fees, and costs incurred by an injured party.
   This bill would, in addition, recast these provisions to prohibit
an obligation or liability consisting of a mortgage, trust deed, or
other security in the nature of a mortgage, that is bearing interest
at a rate in excess of 6% per year and incurred by a service member
before that person's entry into service from bearing interest in
excess of 6% per year for one year after any part of the period of
military service.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 405 of the Military and Veterans Code is
amended to read:
   405.  (a) No obligation or liability bearing interest at a rate in
excess of 6 percent per year incurred by a service member before
that person's entry into service shall, except as provided in
subdivision (b), bear interest at a rate in excess of 6 percent per
year as follows:
   (1) For an obligation or liability consisting of a mortgage, trust
deed, or other security in the nature of a mortgage, during any part
of the period of military service and one year thereafter.
   (2) For any other obligation or liability, during any part of the
period of military service.
   (b) Notwithstanding subdivision (a), if in the opinion of a court,
upon application thereto by the obligee, the ability of the service
member to pay interest upon an obligation or liability at a rate in
excess of 6 percent per year is not materially affected by reason of
that service, the court may make that order as in its opinion may be
just.
   (c) As used in this section, "interest" includes service charges,
renewal charges, fees, or any other charges, except bona fide
insurance, in respect of any obligation or liability.
   (d) Any person violating this section shall be liable for actual
damages, reasonable attorney's fees, and costs incurred by the
injured party.