Bill limits how far states can go in capping out-of-state bank loan rates
In markupH.R. 7866Latest action
Sponsor: Warren Davidson · Representative · OH
AIDecoded by AI · checked against the recordRead the official text
Official title: American Lending Fairness Act of 2026
119th Congress
Topics: Jobs & the economy
Introduced:
Read the official bill on Congress.govIn plain words
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HR 7866 stops states from applying their interest rate caps to banks and credit unions chartered outside their borders.
50-second read · 4 questions answered below
What does this do?
HR 7866 clarifies the boundaries of existing federal law, which allows banks and credit unions to charge the interest rate permitted in their home state, even when lending to borrowers in other states. The bill specifies that a state's opt-out from this federal rule applies only to lenders the state itself charters, not to out-of-state lenders. States that have tried to apply opt-outs broadly would see that authority narrowed.
Who does it affect?
The bill directly affects banks, credit unions, and borrowers, particularly those seeking personal loans in states with strict interest rate caps. State governments that have enacted broad interest rate limits would have their regulatory reach reduced under this bill.
Why does it matter?
Borrowers in states with lower rate caps may continue to receive loan offers from out-of-state lenders charging higher rates permitted by those lenders' home states. State governments would retain rate-setting authority only over the banks and credit unions they license, not over lenders operating across state lines.
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Where does it stand?
- IntroducedMar 9, 2026
- House committeeYou are here · Sep 16, 2026
- House vote
- Senate
- The president's desk
Right now: a House committee is reviewing it. If the Senate changes it, it goes back to the House before reaching the president.
Latest action: — Ordered to be Reported (Amended) by the Yeas and Nays: 31 - 18.