Iowa Senate Bill SSB3066

Iowa 2025-2026 Regular Session

• Introduced: 1/22/26
• Refer: 1/22/26

Caption

A bill for an act relating to certain sales of auto club memberships and vehicle warranties.(See SF 2217.)

Summary

SSB3066 would regulate the sale of auto club memberships and vehicle warranties when they are offered by a licensed lender after a borrower has already been approved for a loan. The bill allows the lender to present these products as optional add-ons, but only if the borrower is told in writing and initials a document acknowledging that the purchase is voluntary and will not affect the loan decision. If the borrower chooses to buy the membership or warranty, the bill requires the lender to let the borrower either pay for it with separate funds or finance the cost through the loan. It also gives the borrower a 30-day cancellation right with a full refund, so long as no services under the membership or warranty have been used. The measure is aimed at consumer disclosure and refund protections in connection with loan-related sales practices.

Impact

The bill would amend section 536.13 of the Iowa Code, adding a new subsection governing post-loan sales of auto club memberships and vehicle warranties by licensees. It would create new disclosure, payment-option, and cancellation/refund requirements for lenders and other covered licensees that offer these products to borrowers. The practical effect is to impose consumer-protection rules on a narrow category of ancillary financial products sold in connection with lending transactions.

Sentiment

There is limited recorded legislative discussion or voting history available for this bill, so overall sentiment cannot be measured from committee debate or floor votes. Based on the bill text, the measure appears to reflect a consumer-protection approach rather than a controversial policy shift, with the main emphasis on ensuring borrowers understand the products are optional and have a short window to cancel. The absence of recorded opposition or amendments in the provided materials suggests the bill was at least presented in a relatively straightforward, technical manner.

Contention

The main potential point of contention is whether lenders should be allowed to market auto club memberships and vehicle warranties in the lending context at all, and if so, how much regulation should attach to those sales. Consumer advocates would likely support the written disclosure and refund rights as protections against pressure-selling or confusion, while lenders or product sellers might view the requirements as adding compliance burdens or limiting ancillary revenue. Another possible issue is the rule allowing the cost to be financed through the loan, which could raise concerns about borrowers taking on additional debt for nonessential products.