Installment Loans

APPENDIX C

SUMMARIES OF STATE CLOSED-END

INSTALLMENT LOAN STATUTES

INTRODUCTION

This set of summaries encompasses state statutes

that allow lenders other than depository institutions

to make installment loans. It excludes statutes and

statutory provisions that:



Are limited to credit for the purchase of goods or

services.



Are limited to credit that is secured by real or per-

sonal property.



Apply only to loans of less than $500, or that apply

only to loans with repayment periods of less than

six months.



Relate solely to non-consumer transactions.



Relate solely to automobile title lending.



Relate to open-end credit (those statutes are sum-

marized in a separate appendix).



Allow lending only by banks or similar depository

institutions (but these summaries do include state

industrial loan laws).

Some states have special statutes for installment

loans. In other states, provisions regarding install-

ment loans are embedded in a more broadly

applicable consumer lending statute. Those provi-

sions are included in these summaries.

Interest rates stated in these summaries are actuarial

and per year unless otherwise specied. Where a

statute expresses a rate cap in the form of “add-on”

interest or “discount interest” (two non-actuarial

methods of expressing a rate cap), these summaries

use those terms. See National Consumer Law Center,

Consumer Credit Regulation Ch. 5 (2012), updated at

www.nclc.org/library, for an explanation of non-

actuarial interest rate calculations. For the sake of

simplicity, interest rates that are calculated by apply-

ing a rate to a declining balance are referred to as

“actuarial” for the most part in these summaries,

without regard to whether they allow unpaid interest

to be added to the principal. However, for some stat-

utes that are particularly clear that unpaid interest

is not to be added to the principal, these summaries

term the interest rate “simple” interest. Where a stat-

ute species a monthly rather than annual interest

rate, in most cases these summaries convert the inter-

est rate to an annual rate.

These summaries identify provisions in state install-

ment loan laws that prohibit unconscionable or

Installment Loans, Appendix C

Installment Loans

WILL STATES PROTECT BORROWERS FROM

A NEW WAVE OF PREDATORY LENDING?

NCLC

NATIONAL

CONSUMER

LAW

CENTER

unreasonable charges. These summaries do not,

however, list other state sources of unconscionabil-

ity rules. For example, a number of state unfair and

deceptive practices statutes prohibit unconscionable

consumer transactions. Whether those laws apply to

credit terms varies from state to state and is beyond

the scope of these summaries. See National Con-

sumer Law Center, Unfair and Deceptive Acts and

Practices §§2.2.1, 4.4 (8th ed. 2012), updated at www.

nclc.org/library for a discussion of these issues.

Many states also recognize a common law prohibi-

tion of unconscionability.

The summaries contained in this appendix list the

types of insurance for which the statutes allow credi-

tors to charge consumers. If the statute prohibits

creditors from charging consumers for insurance in

certain transactions, such as loans under a certain

amount, that is noted. However, the summaries do

not list other restrictions, such as restrictions on the

rates or the reasonableness of the insurance.

State installment loan statutes typically identify the

fees other than interest that lenders can charge. These

summaries list those fees to the extent that they are

conditions of the extension of credit. In other words,

these summaries list fees, such as investigation fees,

document preparation fees, origination fees, transac-

tion fees, and “points,” that the borrower is bound

to incur in order to get or use the extension of credit.

The summaries do not include charges that relate

solely to loans secured by real estate, or charges such

as extension or deferment charges, collection costs,

charges for dishonored checks, and charges for spe-

cial processing of payments that are imposed only if

future events occur. Most state installment loan stat-

utes allow lenders to pass through to consumers fees

for recording and releasing security interests, includ-

ing fees for noting a lien on a motor vehicle certi-

cate of title. These fees are described collectively as

recording fees in these summaries, but details about

the amount of the fees are omitted.

Some state consumer credit statutes provide that the

consumer has the right to prepay a loan, but do not

explicitly state whether a prepayment penalty can be

charged. In some cases, the statute may explicitly or

implicitly forbid any charge that is not specically

allowed. These statutes will likely be interpreted to

allow prepayment without penalty, since the statute

does not specically allow a prepayment penalty.

The statutes’ provisions for rebates of unearned

interest upon repayment must be read with the fed-

eral rebate statute, 15 U.S.C. §1615, in mind. The

federal law requires the rebate of unearned interest

upon prepayment. Moreover, it prohibits any rebate

method less favorable than the actuarial method for

a consumer credit transaction with a term exceed-

ing sixty-one months, and overrides less protective

state laws. The rebate provisions of many of the state

installment loan laws are consistent with these fed-

eral requirements, but inconsistent state provisions

are preempted by the federal law.

Another federal restriction relevant to these summa-

ries relates to wage assignments. The FTC’s Credit

Practices Rule, 16 C.F.R. §444.2(a)(3), prohibits wage

assignments unless they are revocable or apply

only to wages already earned, with exceptions for

payroll deduction plans and for wages that were

already earned at the time of the assignment. Many

state installment loan laws have a similar prohibition,

but the federal rule overrides any less protective

state laws.

Many state consumer credit statutes require certain

lenders to be licensed. These summaries describe

any consequences that attach to unlicensed lending

that are specied in the statute. In some cases, the

consequences may be indirect. For example, some

statutes allow a lender to charge more than a certain

rate only if licensed, and provide that a loan is void

if it includes unauthorized charges. Under these

statutes, any charges above that rate in a loan by an

unlicensed lender are unauthorized, so the lack of a

license means that the loan is void.

These summaries simplify complex statutory provi-

sions, and do not attempt to capture all the nuances

of the statutes or resolve ambiguities. They are based

primarily on a close reading of the statutory lan-

guage, and courts may have interpreted these laws in

unexpected ways. We asked regulators in each state

to review their state’s summaries, and many did, but

the conclusions and summaries are ours and do not

represent an ofcial interpretation or the views of

state regulators. Consumers and lenders should con-

sult an attorney or other authoritative source about

the application and interpretation of these laws, and

attorneys should review their state statutes, regula-

tions, and judicial decisions thoroughly before advis-

ing clients about their requirements. Corrections

should be brought to the attention of the authors.

These summaries were prepared in early 2015 and do

not reect amendments that may have occurred since

then. These summaries are also included as Appen-

dix D to National Consumer Law Center, Consumer

Credit Regulation (2012), updated at www.nclc.org/

library, and will be updated there.

ALABAMA

Ala. Code §§ 5-18-1 to 5-18-23 (Small

Loan Act).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Does not apply to:



Banks, trust companies, savings or building and

loan associations, and credit unions.



Pawnbrokers.



Various agricultural loans.



The business of nancing the purchase of motor

vehicles, refrigerators, or other personal property.



Loans insured or guaranteed by the United States

or any of its agencies.

§5-18-4(b).

Licensure requirements and implications of licensure:

License required to engage in business of making

loans of less than $1,000 and charge more than would

be permitted without a license. §5-18-4(a).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute

applies only to loans of less than $1,000. §§5-18-4,

5-18-18. Loan term must not exceed 25 months (12

months if loan is made under alternate rate struc-

ture). §5-18-15(i), (m)(2).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed?



36% on rst $200, and 24% on remainder, and, if

the scheduled monthly payment is at least $30, an

account maintenance fee of $3 for each month of

the scheduled period of repayment. §§5-18-15(a),

(b), (m)(4), 8-8-14(a). A surcharge of 6% of the

amount nanced can be added to the principal.



Alternative rate structure (allowed if loan term is

no more than 12 months and payments are at least

$40 per month):



Acquisition charge not in excess of 10% of the

amount of principal; and

Installment account handling charge in an

amount no greater than the following:



$12 per month on loan of at least $100 but no

more than $300;



$14 per month on loan of more than $300 but

no more than $400;



$16 per month on loan of more than $400 but

no more than $500;



$17 per month on loan of more than $500 but

no more than $800;



$20 per month on loan of more than $800 but

less than $1,000.



For loan made under alternative rate structure, no

insurance charge or interest surcharge is permit-

ted. §5-18-15(m)(4).



Any lender may lend at 2 percentage points above

the prime rate. §8-8-14(b).

What loan fees are allowed? Recording fees.

§5-18-15(g).

What types of insurance are allowed, and any limits the

lending statute places on charges? May require property

insurance on collateral and offer credit life, disability,

and unemployment insurance. §§5-18-17, 5-19-20.

For loan made under alternative rate structure (see

above), no insurance charge is permitted. §5-18-

15(m)(4).

Does statute prohibit all other fees besides those specically

allowed? Yes. §5-18-15(h).

Does statute restrict balloon payments or irregular pay-

ment schedules? Every loan contract must require pay-

ment in installments at approximately equal periodic

intervals (except to accommodate seasonal income).

No installment contracted for shall be substantially

larger than any preceding installment. §§5-18-15(i),

5-18-16(c).

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Rule of 78s refund (sum of the balances

method) for full prepayment; statute also species

rebate rules when borrower makes partial prepay-

ment of three or more installments. §5-18-15(d). For

prepayment in full of loan made under alternative

rate structure (see above), the installment account

handling charge is subject to refund, but not the

acquisition charge. §5-18-15(m)(3). Prepayment pen-

alties are likely prohibited because not specically

permitted. See §5-18-15(h).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Statute prohib-

its licensee from taking a lien upon real estate, except

a judgment lien. §5-18-4.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report in form prescribed by supervi-

sor, who shall publish annual analysis and recapitu-

lation. §5-18-11(b).

Other signicant features: Prohibits loan-splitting.

§§5-18-15(h), 5-18-18. Anti-evasion provision.

§5-18-4(c).

Ala. Code §§ 5-19-1 to 5-19-33 (Consumer

Credit Act or “Mini-Code”).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Applies generally to all creditors, except

pawnbrokers, insurance agents or agencies that

charge collection fee on unpaid balances for insur-

ance premiums, and policy loans by life insurance

companies. In addition, provisions other than that

§5-19-1(1) (denition of “nance charge”) and

§5-19-3 (maximum nance charges), do not apply to:



A transaction involving an interest in real property

where creditor is exempt from licensing.



Non-consumer transactions.



A credit transaction by a tax-exempt trust or by a

bank or trust company in its capacity as a duciary

under any qualied employer stock bonus, pen-

sion, or prot-sharing plan.



A municipal pension system created under Ala-

bama law.

§5-19-31.

Licensure requirements and implications of licensure:

With exceptions for banks, savings or building and

loan associations, savings banks, other thrift insti-

tutions, bank holding companies, thrift holding

companies, credit unions, and federally constituted

agencies, a license is required to make consumer

loans to Alabama residents or take assignments of

consumer credit contracts. §5-19-22(a). Any person

licensed under the Small Loan Act may engage in

business under that Act, but shall not make loans in

excess of $1,000 unless such person is also licensed

under this Act. §5-19-22(f). If lender makes loan

without a license, it may still bring suit on the loan,

but only after acquiring licensure. §5-19-19(b).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute

has certain provisions that apply to loans under

$2,000 and loans over $2,000. For closed-end loans of

$1,000 or less that are payable in installments, term

shall be no more than 36 months and 15 days, and

no more than 24 months and 15 days if the original

amount nanced is $300 or less. §5-19-18.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed?



For loan of less than $2,000: Add-on rates of $15 per

$100 per year for the rst $750, plus $10 per $100

per year for remainder. In addition, lender may

charge an interest surcharge of 6% of the rst $2,000

of the amount nanced. §8-8-14(a).



For loan of $2,000 or more: Any rate, subject to “all

laws relating to unconscionability in consumer

transactions.” §5-19-3(e) (incorporating §8-8-5).

What loan fees are allowed? Account maintenance fee

of $3.00 for each month, which shall not bear interest.

§5-19-33(a).

What types of insurance are allowed, and any limits the

lending statute places on charges? Credit life, disability,

and involuntary unemployment insurance; prop-

erty insurance on collateral and liability insurance,

but only if original amount nanced is $300 or more

and the value of the property is $300 or more; non-

ling insurance; other insurance as allowed by rule.

§5-19-20.

Does statute prohibit all other fees besides those specically

allowed? Statute provides penalties for charging a

nance charge in excess of the amount authorized by

the statute, §5-19-19(a), but otherwise is silent.

Does statute restrict balloon payments or irregular pay-

ment schedules? Debtor has right to renance any

balloon payment on terms at least as favorable as

the original terms, except where payments have

been adjusted to conform to the debtor’s seasonal or

irregular income, or loan is repayable in a single prin-

cipal payment irrespective of the scheduled inter-

est payments. §5-19-7. For closed-end transactions

where debt is payable in installments and in which

original amount nanced is $1,000 or less, debt shall

be scheduled to be payable in substantially equal

installments at equal periodic intervals, except to

the extent that the schedule of payments is adjusted

to the seasonal or irregular income of the debtor or

when the transaction is a single principal payment

obligation irrespective of the scheduled interest pay-

ments. §5-19-18.

Any restrictions on renancing? If loan is renewed or

renanced within rst 120 days, debtor is entitled to

pro rata refund of nance charge. §5-19-4(h).

Any rebate requirements or restrictions on prepayment

penalties? Debtor may prepay without penalty.

§§5-19-3(d)(3), 5-19-4(c). For loan with original term

of more than 61 months, actuarial rebate; for all other

transactions, Rule of 78s (sum of the balances), but no

refund of less than $1.00 need be made. §5-19-4(c).

When creditor has charged the 6% interest surcharge

permitted by §8-8-14, and borrower prepays within

rst 90 days, borrower is entitled to pro rata rebate

of the surcharge, except that creditor may retain $25.

§8-8-14(a).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Statute is

silent.

Does statute prohibit unconscionable loan charges? Yes.

§5-19-16. See also §8-8-5(a) (allowing agreed rate

transactions but subjecting them to this unconsciona-

bility rule).

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: Loan-splitting prohibited.

§5-19-17.

ALASKA

Alaska Stat. §§ 06.20.010 to 06.20.920 (Small

Loans Act).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? All lenders except:



Exception from license requirement only: Banks,

savings banks, trust companies, building and loan

associations, and credit unions. §06.20.010(b).



Complete exemption: Individual loans by pawn-

brokers where separate and individual loans do not

exceed $750 or loan shops where separate and indi-

vidual loans do not exceed $500. §06.20.330.

Licensure requirements and implications of licensure:

A license is required for the business of making

loans up to $25,000 at an interest rate greater than

otherwise permitted by law for non-licensees.

§§06.20.010(a), 06.20.300. Non-licensee is lim-

ited to rate that can be charged without a license,

§06.20.300, and loan is unenforceable if more inter-

est has been changed than permitted by the Act,

§06.20.310.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Law

applies to loans of $25,000 and less. Except for open-

end loans under §06.20.285, licensee may not enter

into loan that provides for a scheduled repayment of

principal over more than the maximum terms set out

below opposite the respective size of loans.

PRINCIPAL AMOUNT OF LOAN MAXIMUM TERM

up to $1,000 24 and 1/2 months

Over $1,000 to $2,500 48 and 1/2 months

Over $2,500 to $5,000 60 and 1/2 months

Over $5,000 to $25,000 as agreed to by the parties

§ 06.20.250(c).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? For loan up to $25,000:



36% on rst $850;



24% on amount over $850 but not exceeding

$10,000; and



Any rate agreed by contract on remainder.

§06.20.230. For amounts greater than $25,000, a

licensee may not charge more interest than allowed

for non-licensees. §06.20.280.

What loan fees are allowed? Recording fees, or non-

ling insurance premiums that do not exceed these

fees. For loans over $10,000, whether or not secured

by an interest in real estate: reasonable costs and fees

paid by a licensee for appraisals, surveys, title insur-

ance or reports, and credit reports. §06.20.260(a).

What types of insurance are allowed, and any limits the

lending statute places on charges? Credit insurance

(dened as credit life insurance, credit disability

insurance, and credit unemployment insurance),

insurance on pledged property, and non-ling insur-

ance. §06.020.260.

Does statute prohibit all other fees besides those specically

allowed? Yes. §06.20.260.

Does statute restrict balloon payments or irregular pay-

ment schedules? Yes, payments must be in substan-

tially equal amounts and must be due at least once

a month, with the rst payment beginning no later

than 45 days from the date the loan is made. There

are exceptions for seasonal or extraordinary income.

§06.20.250(d), (e).

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Statute is silent on rebate requirements.

Prepayment penalties are likely prohibited because

not authorized by §06.20.260. Lender must permit

payment to be made in advance in any amount at

any time. §06.20.270(3).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Statute does

not include restrictions on security interests. It refers

to credit insurance on pledged property and to loans

secured by interests in real estate, so appears to con-

template these security interests. §06.20.260(a)(2), (4).

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report containing information as the

department may reasonably require. §06.20.190.

Other signicant features: Loan-splitting prohibited.

§06.20.240.

Alaska Stat. § 45.45.080 (Installment Loans).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Applies to any “lender of money.”

§45.45.080(a).

Licensure requirements and implications of licensure: Stat-

ute is silent.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Loan

not exceeding $10,000. Period of not over 7 years.

§45.45.080(b).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? Interest at $6 a year

for each $100 (true annual interest rate for “add-

on method” of computation at a rate not to exceed

11.1%; or “

true annual interest rate for ‘discount method’

of computation at a rate not to exceed 11.8 percent) upon the

original face amount of the instrument evidencing the loan

for the entire period of the loan.”

§45.45.080(b).

What loan fees are allowed? Recording fees.

§45.45.080(c)(3), (4).

What types of insurance are allowed, and any limits the

lending statute places on charges? Lender may charge

premiums paid by lender for insurance required or

obtained as security for or by reason of the install-

ment loan. §45.45.080(c)(2).

Does statute prohibit all other fees besides those specically

allowed? Yes. The only charges permitted are specied

in §45.45.080(c).

Does statute restrict balloon payments or irregular pay-

ment schedules? Yes. Loan must be repayable in sub-

stantially equal installments. §45.45.080(b).

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Rule of 78s (sum of the balances method),

but no refund of less than $5.00 need be made.

§45.45.080(b).

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? No limits

indicated. Statute provides that lender may charge

interest on loan “upon the security of personal prop-

erty or otherwise.” §45.45.080(a).

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: Not applicable.

ARIZONA

Ariz. Rev. Stat. Ann. §§ 6-601 to 6-638

(Consumer Lenders Act).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Primarily non-bank lenders making at least

three consumer loans per calendar year to state resi-

dents. Specic exclusions:



Banks, savings banks, trust companies, savings

and loan associations, prot sharing and pension

trusts, credit unions, insurance companies, and

receiverships.



Licensed pawnbrokers.



Lenders making fewer than two such loans per cal-

endar year to state residents (see §6-601(16)(b)).



Mortgage brokers.



Certain educational loans.

§ 6-602

Licensure requirements and implications of licensure:

License required to engage in consumer lender busi-

ness (making loans of $10,000 or less) unless exempt.

§6-603(A). Loan made by unlicensed lender is void.

§6-613(B).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Maxi-

mum loan size subject to statute: $10,000 or less.

§§6-601(7), 6-602(B). Maximum loan term for con-

sumer loans:



24 months and 15 days for loans up to $1,000.



36 months and 15 days for loans greater than $1,000

but no more than $2,500.



48 months and 15 days for loans greater than $2,500

but no more than $4,000.



60 months and 15 days for loans greater than $4,000

but no more than $6,000.



Any agreed on time period for loans of more than

$6,000.

§ 6-637(A).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? 36% on rst $3,000 and

24% on remainder. §6-632(A).

What loan fees are allowed?



Recording fees, or cost of non-ling insurance up to

that amount. §6-635(A)(3).



Loan origination fee of 5% of loan, capped at $150.

§6-635(A)(4).

What types of insurance are allowed, and any limits the

lending statute places on charges? Property insurance

on collateral, life insurance, credit disability insur-

ance, and credit unemployment insurance. §§6-636,

6-638.

Does statute prohibit all other fees besides those specically

allowed? Yes. §6-635(C).

Does statute restrict balloon payments or irregular pay-

ment schedules? Consumer loans: Yes, note must pro-

vide for approximately equal periodic installments.

§6-637(B). See also §6-634(A).

Any restrictions on refinancing? Prohibits charging of

a loan origination fee if loan is renanced within one

year. §6-635(A)(4)(a).

Any rebate requirements or restrictions on prepayment

penalties? Lender must allow prepayment at any time.

§6-637(F). Actuarial rebate. §6-634(B).

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Statute

is silent, but references in various sections appear

to contemplate security interests in personal and

real property. See, e.g., §§6-635(A)(3) and §6-636(E)

(referring to property insurance and security

interests).

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Criminal usury statute, §13-2208, only

criminalizes charging interest greater than authorized

by other law.

Reporting requirements, including detail about what

must be reported and whether there are any requirements

that the state agency review or take other steps regard-

ing the reports: Annual report in form prescribed by

superintendent, including lender’s standard APRs

for several types of loans, including a $500 unsecured

consumer loan payable in 12 equal monthly install-

ments, a $2,500 consumer loan secured by a motor

vehicle payable in 36 equal monthly installments,

and a $9,000 consumer loan secured in full by real

property payable in 120 equal monthly installments,

Superintendent must compile quarterly report of the

standard APRs. §§6-609, 6-635(D).

Other signicant features: Anti-evasion provision.

§6-603(B). Referral fees prohibited. §6-611(B).

ARKANSAS

Ark. Const. amend. 89; Ark. Code Ann.

§§ 4-57-101 to 4-57-108 (Consumer Loans

and Credit Sales).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? All loans other than bonds issued and loans

made by governmental units, and loans by federally

insured depository institutions. Ark. Const. amend.

89, §§1, 2.

Licensure requirements and implications of licensure: Stat-

ute and constitution are silent.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute

and constitution are silent.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute and constitution are silent.

What rate of interest is allowed? 17%. Ark. Const.

amend. 89, §3; Ark. Code Ann. §4-57-104.

What loan fees are allowed? Statute and constitution are

silent.

What types of insurance are allowed, and any limits the

lending statute places on charges? Statute and constitu-

tion are silent.

Does statute prohibit all other fees besides those specically

allowed? Yes. Ark. Code Ann. §4-57-105.

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute and constitution are silent.

Any restrictions on renancing? Statute and constitu-

tion are silent.

Any rebate requirements or restrictions on prepayment

penalties? Statute and constitution are silent.

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Statute

and constitution are silent.

Does statute prohibit unconscionable loan charges? Stat-

ute and constitution are silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute and constitution are silent.

Is lending under this statute exempt from state criminal

usury law? Statute and constitution are silent.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute and constitution are silent.

Other signicant features: Not applicable.

CALIFORNIA

Cal. Fin. Code §§ 22000 to 22757 (West)

(Finance Lenders Law).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? “Finance lender” includes any person

engaged in the business of making consumer loans

(dened by §22204 to include loans of less than $5,000

for non-consumer purposes) or making commercial

loans. §22009. “Finance lender” includes any person

engaged in the business of making consumer loans

as dened in §22203 or making commercial loans of

$5,000 or more, §22009. Consumer loans also include

commercial loans of less than $5,000 as dened by

§22204. The above statute does not apply to:



Banks, trust companies, savings and loan associa-

tions, insurance premium nance agencies, credit

unions, small business investment companies, com-

munity advantage lenders, or California business

and industrial development corporations.



Licensed pawnbrokers (when acting under the

authority of that license).



Licensed payday lenders.



Check cashers holding valid permit.



College or university making loan for program or

course of study leading to a degree or certicate.



Broker-dealer acting pursuant to a certicate under

state law.



Person who makes 5 or fewer commercial loans in

a 12-month period, if the loans are incidental to the

person’s business §22050.



A public corporation, public entity other than the

state, or any of their agencies (§22050).



Certain agricultural credit (§22051).



Retail sales contracts (§22054).



Premium nancing (§22055).



Loans under certain state development and waste

management programs (§22056).



Cemetery brokers (§22058).



Certain credit cards issued by an organization to its

members for a fee designed to cover the adminis-

trative costs of the plan (§22052).



Loan made or arranged by state-licensed real estate

broker and secured by a lien on real property, or

made to a licensed real estate broker who is making

such a loan, even if loan is then sold to a nance

lender (§22057).



Loans made or arranged by licensed residential

mortgage lender or servicers (§22060).



Nonprot church extension funds (§22061).



Certain commercial bridge loans (§22062).



Loans made by franchisors to franchisees (§22063).



Certain investments by charities and foundations

(§22064).

The Finance Lenders Law has a structured regula-

tory threshold of loan amounts of $2,500, $5,000,

and $10,000 or more in which certain interest rates,

fees, and other charges are exempt as summarized

in §22250 and §22251. Loans of $5,000 or more are

exempt from some of the Act’s provisions. Loans of

$10,000 or more are largely exempt from the provi-

sions relevant to these summaries. §22250.

Licensure requirements and implications of licensure:

Must have license to engage in business of making

consumer loans. §§22100(a), 22009 (denition of

nance lender). Willful violation of any provision of

Act renders loan void. §§22750.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Closed-

end loan, other than certain student loans, must be

repayable over no more than:



24 months and 15 days if less than $500;



36 months and 15 days if at least $500 but less than

$1,500.



48 months and 15 days if at least $1,500 but less

than $3,000.



60 months and 15 days if at least $3,000 but less

than $5,000.

§ 22334. Loan under Pilot Program for Increased

Access to Responsible Small Dollar Loans must be

repayable over a period of no less than:



90 days if less than $500.



120 days if at least $500 but less than $1,500.



180 days if at least $1,500 (but no more than pro-

gram’s cap of $2,500).

§ 22370(a)(5).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed?



For loans of less than $2,500: 2.5% per month on

rst $225; 2% per month on amount over $225 but

no more than $900; 1.5% per month on amount

over $900 but no more than $1,650; and 1% per

month on remainder. §22303.



Alternative rate for loans less than $2,500: The

greater of 1.6% per month on the unpaid principal

balance or 5/6 of 1% per month plus a percentage

per month equal to 1/12 of the annual rate prevail-

ing on the 25th day of the second month of the

quarter preceding the quarter in which the loan is

made, as established by the Federal Reserve Bank

of San Francisco. §22304.



For the Pilot Program for Increased Access to

Responsible Small Dollar Loans: As an alternative

to the charges authorized by §§22303 or 22304 (see

above), an approved licensee may charge: (1) the

lesser of 36% or the sum of 32.75% plus the United

States prime lending rate on the rst $1,000 of the

principal and (2) the lesser of 35% or the sum of

28.75% plus the United States prime lending rate on

the remainder. §22370(b).



Statute does not state a limit on interest rate for

loans of $2,500 or more.

What loan fees are allowed?



For loans of $2,500 or less: Administrative fee of 5% or

$50 (of the bona de loan amount), whichever is less.



For loans of more than $2,500 but less than $5,000:

$75.



$5,000 or more: Limits do not apply.

§§ 22250, 22305. Recording fees, and any premium

for non-ling insurance. §22336 (limited to actual

statutory fee paid to public ofcer). For loans made

under Pilot Program for Increased Access to Respon-

sible Small Dollar Loans: approved licensee may

charge administrative fee of: (1) 7% of the principal

or $90, whichever is less, on the rst loan made to a

borrower and (2) 6% of the principal or $75, which-

ever is less, on the second and subsequent loans

made to that borrower. May not charge same bor-

rower an administrative fee more than once in any

4-month period. §22370(c).

What types of insurance are allowed, and any limits the

lending statute places on charges? Licensee may pro-

vide credit insurance, including credit life, disability

insurance, and loss-of-income insurance, and prop-

erty insurance on collateral. §§22313, 22314(b) (both

are inapplicable to loans of over $10,000). Credit

insurance and property insurance are prohibited for

loans under the Pilot Program for Increased Access to

Responsible Small Dollar Loans. §22370(g).

Does statute prohibit all other fees besides those specically

allowed? Yes. §§22306, 22326 (but these provisions are

applicable only to loans of less than $5,000). The stat-

ute prohibits all other fees besides those specically

allowed by statute such as late fees, NSF fee, and lien

fee when provided for in the loan agreements for

loans less than $5,000. For loans of $5,000 or more,

the fees must be provided for in the loan agreement

and limited to actual cost.

Does statute restrict balloon payments or irregular pay-

ment schedules? Closed-end loan of less than $10,000,

other than educational loan, must be payable in sub-

stantially equal periodical installments. §22307(b), (c)

and Cal. Code Regs. tit. 10, §1453.

Any restrictions on renancing? No administrative fee

for renancing unless at least one year since receipt

of a previous administrative fee. §22305. For loans

made under Pilot Program for Increased Access

to Responsible Small Dollar Loans, renancing is

prohibited unless borrower has repaid at least 60%

of principal, is current on the loan, meets ability-to-

repay requirements, and, if loans are for personal,

family, or household purposes, has not previously

renanced the outstanding loan more than once. An

administrative fee shall not be charged for renanc-

ing unless at least 8 months have passed since the

receipt of a previous administrative fee paid by the

borrower. §22370(c)(3), (4).

Any rebate requirements or restrictions on prepayment

penalties? Borrower may prepay at any time. For

loans less than $10,000, no prepayment penalty may

be charged due to the fact that all payments must

be substantially equal with no balloon payment.

§22307(b), (c); Cal. Code Regs. tit. 10, §1453. For loan

over $10,000, any prepayment penalty intended to be

collected must be provided for in the loan agreement.

§§22337, 22400(a)(2). Borrower is entitled to actuarial

rebate of precomputed interest, but no refund need

be made if less than $1.00. §§22400(a)(2), 22402.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Security

interest in real property, other than judgment lien,

is prohibited for consumer loan of less than $5,000.

§22330. Loans under the Pilot Program for Increased

Access to Responsible Small Dollar Loans must be

unsecured. §22370(a)(1). Under the Finance Lenders

Law, loans may be unsecured, secured by personal

property, secured by real property, and or by busi-

ness equipment. Postdated checks may be accepted

by a lender. ACH authorizations are permitted only

if requested by the borrower and cannot be a require-

ment of the loan by the lender.

Does statute prohibit unconscionable loan charges? Yes.

§22302 (applying unconscionability prohibition of

Civil Code §1670.5 to all loans subject to the Act).

Must lender underwrite or evaluate borrower’s ability to

repay? Yes. §22370(f)(4) (Pilot Program for Increased

Access to Responsible Small Dollar Loans); Cal. Code

Regs. tit. 10, §1452 (all loans made under California

Finance Lenders Law).

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable. Note also that

§22002 exempts credit transactions governed by this

Act from state constitution’s interest rate cap.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report with relevant information in

form prescribed by commissioner. Reports shall be

made available to the public for inspection except,

upon lender’s request, the balance sheet contained

in the annual report of a sole proprietor or any other

non-publicly traded persons. Commissioner must le

composite report annually. §§22159, 22160. Lender

participating in the Pilot Program for Increased

Access to Responsible Small Dollar Loans must le

annual report separate from any other annual report

licensee may have to le. §22367. On or before July

1, 2015, and again, on or before January 1, 2017,

the commissioner shall post a report on his or her

Internet website summarizing utilization of the Pilot

Program for Increased Access to Responsible Small

Dollar Loans. §22380.

Whether the law authorizes open-end credit: Yes. §22450.

Other signicant features: Prohibition against lend-

ing more than the borrower wants. §22251. Loan-

splitting prohibited (but this section does not apply

to loans of $5,000 or more). §22327. Anti-evasion

provisions. §§22326 (inapplicable to loans of $5,000

or more), 22335.

COLORADO

Colo. Rev. Stat. §§ 5-1-101 to 5-13-103

(Consumer Credit Code).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? All creditors extending consumer credit

except loans to government, non-installment sales of

insurance, certain transactions under public utility

or common carrier tariffs, certain transactions with

pawnbrokers, certain aspects of transactions involv-

ing securities and commodities accounts, and certain

state-guaranteed loans. §5-1-202. Some provisions

apply just to “supervised lenders,” dened as deposi-

tory institutions and licensed lenders, or to “super-

vised loans,” dened as consumer loans at more than

12%. §5-1-301(46).

Licensure requirements and implications of licensure:

Must be a supervised nancial organization (dened

by §5-1-301(45) as taking deposits) or have obtained

a license in order to engage in the business of

making supervised loans (dened by §5-1-301(47)

as consumer loans at more than 12%) or to collect on

them. §§5-2-301. If lender makes supervised loan

without a required license, consumer is not required

to pay the nance charge. §5-5-201.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: “Con-

sumer loan” means a loan made or arranged by a

person regularly engaged in the business of making

loans in which either the principal does not exceed

$75,000 or the debt is secured by land. §5-1-301(15).

Closed-end supervised loan of $1,000 or less shall

be payable over no more than 25 months; for loan

of more than $1,000 but not more than $3,000, over

no more than 37 months. §5-2-308. The minimum

term of a loan made pursuant to §5-2-214 (alterna-

tive charges for loans not exceeding $1,000) shall be

90 days and the maximum term shall be 12 months.

§5-2-214(2).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed?



For a consumer loan other than a supervised loan,

12%, but lender may charge minimum of $25. §5-2-

201(1), (7).



For a supervised loan, the greater of either: (a) 36%

on rst $1,000, plus 21% on next $2,000, plus 15%

on remainder or (b) 21%. In either case, lender may

charge minimum of $25. §5-2-201(2), (7).



In the alternative, for a supervised loan of $1,000

or less with a term of at least 90 days but no more

than 12 months that is repayable in substantially

equal installments, supervised lender may charge:

(1) an acquisition charge of 10% of the amount

nanced (7.5% for a renancing); and (2) a monthly

installment account:

AMOUNT FINANCED PER MONTH CHARGE

$100.00–$300.00 $12.50

$300.01–$500.00 $15.00

$500.01–$750.00 $17.50

$750.01–$1,000.00 $20.00

§ 5-2-214(1), (2). Creditor may contract for prepaid

nance charge, but total nance charge shall not

exceed that permitted for consumer credit transactions.

§5-2-207(1).

What loan fees are allowed?



Ofcial fees and taxes.



Reasonable charges for other benets conferred on

the consumer if they meet certain requirements and

are authorized by the administrator.

§ 5-2-202(1).

What types of insurance are allowed, and any limits the

lending statute places on charges? Creditor may provide

and charge for insurance. §5-4-104. Statute speci-

cally mentions property insurance, liability insurance

covering liability arising out of ownership or use of

property related to the credit transaction, and credit

life, accident, and health insurance. §§5-2-202(3), 5-4-

301, 5-4-303. Creditor may not charge for property

insurance unless the amount nanced is $1,000 or

more and the value of the property is $1,000 or more.

§5-4-301.

Does statute prohibit all other fees besides those specically

allowed? Consumer is not required to pay a charge in

excess of that allowed by the statue. §5-5-201(2). In

addition, for loans subject to the alternative charges

authorized by §5-2-214, statute provides that no

charge is allowed other than those specically pro-

vided for. §5-2-214(3).

Does statute restrict balloon payments or irregular pay-

ment schedules? Supervised closed-end loans of $3,000

or less (with exception for seasonal or irregular

income), and all loans made pursuant to §5-2-214

(alternative charges for loans not exceeding $1,000)

shall be scheduled to be payable in substantially

equal installments at equal periodic intervals. §§5-2-

214(2), 5-2-308. Consumer has right to renance

any balloon payment at creditor’s prevailing rates

if the consumer meets the creditor’s normal credit

standards and if the creditor is still in the business

of making such transactions, unless schedule was

adjusted for borrower’s seasonal or irregular income.

§5-3-208.

Any restrictions on renancing? If loan is renanced

within one year, prepaid nance charge can be

imposed only on new money portion, or lender must

rebate unearned portion of prepaid nance charge.

§5-2-207(2). A lender may not renance a loan made

pursuant to §5-2-214 (alternative charges for loans

not exceeding $1,000) more than 3 times in one year.

§5-2-214(8).

Any rebate requirements or restrictions on prepayment

penalties? For precomputed obligation with 61 or

fewer installments, Rule of 78s (sum of the balances

method), but creditor may retain a minimum charge

contracted for, up to $25; otherwise, actuarial. No

rebate of less than $1.00 is required. §5-2-211. Special

rules for rebates upon prepayment of loans made

under §5-2-214. §5-2-214(4), (5).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? For a con-

sumer loan of $3,000 or less, security interest in land

is prohibited and void. §5-3-204. Wage assignment is

prohibited and unenforceable. §5-3-206. No collateral

is allowed for any loan made pursuant to §5-2-214

(alternative charges for loans not exceeding $1,000).

§5-2-214(7).

Does statute prohibit unconscionable loan charges? Yes:

§5-5-109.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Criminal usury statute, which

makes it a crime to charge more than 45%, provides

that it is inapplicable to charges and fees permitted

by the Consumer Credit Code. §18-15-104.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report in form prescribed by adminis-

trator. Information contained in annual reports may

be published only in composite form. §5-2-304(2).

Other signicant features: Prohibits loan-splitting.

§5-3-205.

Colo. Rev. Stat. §§ 5-3.1-101 to 5-3.1-123

(Deferred Deposit Loan Act).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applies to all persons who make or arrange

deferred deposit loans (payday loans). §5-3.1-102(5).

Licensure requirements and implications of licensure:

Supervised lender’s license required to engage in

business of deferred deposit loans. §5-3.1-116.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Loans for

more than $500 prohibited. §5-3.1-106. No maximum

loan term, but minimum is six months. §5-3.1-103.

Other restrictions on applicability of statute (e.g., it

only applies if lender takes a mortgage on real property):

Applies only to loans for which creditor takes a

dated instrument (including an ACH authorization).

§5-3.1-102(3).

What rate of interest is allowed? 20% of the rst $300

loaned plus 7½% of the remainder. May also charge

45% interest. §5-3.1-105.

What loan fees are allowed? Monthly maintenance fee

of $7.50 per $100.00 loaned, up to $30.00 per month.

This fee may be charged for each month the loan is

outstanding 30 days after the date of the original loan

transaction. §5-3.1-105.

What types of insurance are allowed, and any limits the

lending statute places on charges? Insurance charges are

prohibited because they are not specically autho-

rized. §5-3.1-105.

Does statute prohibit all other fees besides those specically

allowed? Yes. §5-3.1-105.

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent.

Any restrictions on renancing? Must be 30-day wait-

ing period between loans. §5-3.1-106. Loan may

not be renewed more than once. §5-3.1-108. Upon

renewal of a loan, lender may assess an additional

nance charge not to exceed an APR of 45%. §5-3.1-

108(2). Nothing prohibits lender from renancing a

deferred deposit loan as a supervised loan subject to

the provision of the Consumer Credit Code, articles

1 to 9, except that lender may not charge the mini-

mum nance charge contained in §5-2-201(7) ($25).

§5-3.1-108(4).

Any rebate requirements or restrictions on prepayment

penalties? Lender must accept prepayment and may

not charge a penalty. §5-3.1-103 Borrower who pre-

pays is entitled to pro rata rebate of interest based on

the ratio of time left before maturity to loan term, but

is not entitled to a rebate of the other nance charges.

§5-3.1-105.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Denition

describes “dated instrument” as “sole security.”

§5-3.1-102(3), (4).

Does statute prohibit unconscionable loan charges? Yes.

§5-5-109 (made applicable to these loans by §§5-3.1-

119 and 5-3.1-122). However, if lender complies with

requirements addressing ability to repay (see below),

and the loan otherwise complies with this and other

applicable law, neither the consumer’s inability

to repay nor the lender’s decision to obtain or not

obtain additional information concerning the con-

sumer’s creditworthiness shall be cause to determine

that a loan is unconscionable. §5-3.1-122(4).

Must lender underwrite or evaluate borrower’s ability

to repay? Lender must require consumer to ll out

a loan application and provide a pay stub or other

evidence of income at least once in each 12-month

period. If amount borrowed is not more than 25%

of consumer’s monthly gross income and benets,

lender shall not be obligated to investigate the con-

sumer’s continued debt position, and consumer’s

ability to repay the loan need not be further demon-

strated. §5-3.1-122(2), (3).

If state has a criminal usury law, is lending under this

statute exempt from it? Criminal usury statute, which

makes it a crime to charge more than 45%, provides

that it is inapplicable to charges and fees permitted

by the Consumer Credit Code, of which this article is

a part. §18-15-104.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report in form prescribed by adminis-

trator, including proof of licensee’s nancial respon-

sibility. Information contained in annual reports may

be published only in composite form. §§5-2-304,

5-3.1-115.

Other signicant features: The provisions of the Con-

sumer Credit Code, articles 1 to 9, apply to a lender

unless such provisions are inconsistent with this arti-

cle. §5-3.1-119. Anti-evasion provision. §5-3.1-121.

Incorporates prohibition against loan splitting, but

provides that it is not a violation if consumer obtains

a deferred deposit loan voluntarily and separately

from spouse and consumer’s action is documented in

writing, signed by consumer, and retained by lender.

§5-3.1-123.

CONNECTICUT

Conn. Gen. Stat. §§ 36a-555 to 36a-573

(Small Loan Law). See also Conn. Agencies

Regs. §§ 36a-570-1 to 36a-570-17.

What types of lenders does it apply to (e.g., banks vs. non-

banks)? All lenders except banks, credit unions, sav-

ings and loan association wholly owned subsidiary

service corporations, persons who make loans for

agricultural, commercial, industrial or governmental

use or extend retail credit through an open-end credit

plan, mortgage lenders or mortgage correspondent

lenders licensed pursuant to §36a-489 when making

residential mortgage loans, and licensed pawnbro-

kers. §36a-555.

Licensure requirements and implications of licensure:

Must be licensed in order to make, offer, broker, assist

a borrower, or in whole or in part, arrange through a

third party or act as an agent for a third party a loan

in the amount of $15,000 or less and charge interest

greater than 12%. §36a-555

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Loans of

$15,000 and less. §36a-555. A loan governed by this

statute shall not originally schedule any repayment

of the cash advance over a period in excess of:



24 months and 15 days if the amount of the original

cash advance was $1,000 or less; or



36 months and 15 days if the amount of the original

cash advance was between $1,000 and $1,800; or



72 months and 15 days if the amount of the original

cash advance was over $1,800. §36a-568.

In addition, interest rate must be reduced to 12% on

any balance scheduled to be repaid after these peri-

ods. §36a-563(h).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? On loan of $1,800 or

less, or any loan that is unsecured or secured only by

credit life insurance, add-on interest of $17 per hun-

dred per year on rst $600 and $11 per $100 per year

on remainder; on other loans, add-on rate of $11 per

$100 per year. §36a-563(a).

What loan fees are allowed? Specied closing costs for

loan secured by real property. §36a-563(i).

What types of insurance are allowed, and any limits the

lending statute places on charges? Credit life and acci-

dent and health insurance. §36a-566.

Does statute prohibit all other fees besides those specically

allowed? Yes. §36a-563(h).

Does statute restrict balloon payments or irregular pay-

ment schedules? Payments must be substantially

equal in amount or so arranged that no installment is

substantially greater in amount than any preceding

installment, and must be payable at approximately

equal intervals not exceeding one month. §36a-568.

Any restrictions on renancing? No part of the prin-

cipal balance remaining unpaid by a borrower 24

months and 15 days after making such contract

where the original cash advance was $1,000 or

less, or 36 months and 15 days where the original

cash advance was between $1,000 and $1,800, shall

directly or indirectly be renewed or renanced by the

lender. §36a-563(h). No loan shall be renewed or re-

nanced unless a distinct advantage to the borrower

(other than restoration to a contractually up-to-date

condition) results therefrom. Conn. Agencies Regs.

§36a-570-4(d). No loan may be renanced earlier

than 90 days after consummation, unless payment is

reduced by 10% or $5, whichever is greater, or at least

$75 in new money is extended. Conn. Agencies Regs.

§36a-570-13.

Any rebate requirements or restrictions on prepayment

penalties? Actuarial if loan term exceeds 48 months

and 15 days, and otherwise Rule of 78s. No refund

of less than $1.00 need be made. §36a-563(b), (f).

Prepayment is permitted. §§36a-563(f), 36a-567. Pre-

payment penalties are likely prohibited, because not

authorized by §36a-563(h). See also Conn. Agencies

Regs. §36a-570-17(e) (prepayment penalties in mort-

gage loans exceeding $5,000).

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Security

interests in household goods and wage assignments

as security are prohibited. Lender may take a security

interest in chattels or personal property other than

household goods, except that if the cash advance is

$1,800 or less a security interest in an automobile is

prohibited. Security interest in real estate is allowed

only if cash advance is exceeds $1,800. §36a-568.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Statute is silent, but criminal usury stat-

ute, §37-4 prohibits interest over 12% only if not oth-

erwise provided by law.

Reporting requirements, including detail about what

must be reported and whether there are any requirements

that the state agency review or take other steps regarding

the reports: Lender must annually furnish a sworn

statement to commissioner of the condition of the

business. §36a-569.

Other signicant features: Loan-splitting prohibited.

§36a-563(h).

DELAWARE

Del. Code Ann. tit. 5, §§ 2227 to 2245

(Regulated Closed-End Credit, Licensed

Lenders).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Applies to all persons transacting the

business of lending money. Excludes anyone making

fewer than 6 loans within a 12-month period and

banks, federal credit unions, insurance companies,

and anyone lending under other state or federal law.

§2202.

Licensure requirements and implications of licensure:

Must have license to transact business of lending

money. §2202. Licensees may make closed-end loans

within the limits of this statute. §2228(a).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute is

silent.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? Any rate agreed upon.

§§2229, 2237.

What loan fees are allowed?



Reasonable fees for services rendered or expenses

incurred, such as commitment fees, ofcial fees

and taxes, premiums for insurance protecting the

licensee against the borrower’s default or other

credit loss, costs for title examination, inspection,

recording and other formal acts necessary or appro-

priate to the security of the loan, ling fees, attor-

ney fees and travel expenses.



Other charges that Commissioner includes in a

schedule of costs, fees, services, points, premiums

and other reasonable expenses.

§ 2231.

What types of insurance are allowed, and any limits the

lending statute places on charges? Life, health, accident,

health and accident or other permissible insurance

on borrower; property and liability insurance on col-

lateral. §2233.

Does statute prohibit all other fees besides those specically

allowed? Yes. §2231(3).

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent.

Any restrictions on renancing? Renancing and

renancing fees are explicitly authorized under

§2235(a).

Any rebate requirements or restrictions on prepayment

penalties? Borrower may prepay at any time. Prepay-

ment penalty prohibited except for residential mort-

gage loan. Actuarial rebate required, but no refund

need be made if less than $5. §2234. Licensee may

not impose any prepayment charge, except that in the

case of a residential mortgage loan may charge any

prepayment penalty or charge specied in the agree-

ment governing, or the bond, note or other evidence

of, the loan. §2234(e).

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Any secu-

rity is allowed (§2228(a)) except an interest in wages.

§2242(a).

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: Not applicable.

DISTRICT OF COLUMBIA

D.C. Code §§ 26-901 to 26-912 (Money

Lenders Law with licensing provisions), 28-3301

(interest rate limitations).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Licensure law does not apply to “the legiti-

mate business” of national banks, licensed bankers,

licensed mortgage brokers, licensed mortgage lend-

ers, trust companies, savings banks, building and

loan associations, small business investment compa-

nies, or life insurance companies. §26-910(a).

Licensure requirements and implications of licensure:

Must have license to engage in business of loaning

money at more than 6%. §26-901(a).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Licensure

law does not apply to loans greater than $25,000.

§26-912(a)(5). Licensure law also provides that

licensed lender cannot make loan of more than $200.

§26-905. The result appears to be that a lender such

as a bank or licensed mortgage broker that is exempt

from the licensure provisions of §§26-901 to 26-912

may make loans at the 24% interest rate allowed by

§28-3301; and a lender that is subject to the licensure

requirements of §§26-901 to 26-912 may also make

loans at 24% interest, but is limited to loans of $200

or less. See In re Parkwood, Inc., 461 F.2d 158, 180 (D.C.

Cir. 1971) (if lender has obtained a license, then it can

charge interest at the rate provided by the code pro-

vision, but is limited to loans of $200 or less).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Licen-

sure law is inapplicable to any loan to a corporation

that is unable to plead usury as a defense; to a loan

secured by real estate outside the District; or to a loan

to a borrower outside the District.

What rate of interest is allowed? 24%. §§26-905,

28-3301(a).

What loan fees are allowed? Lender may charge points,

but they are limited to 1% of principal unless they

buy down the interest rate. §28-3301(e)(2).

What types of insurance are allowed, and any limits the

lending statute places on charges? Statute is silent.

Does statute prohibit all other fees besides those specically

allowed? Statute is silent.

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Statute is silent.

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Statute is

silent.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Statute is silent.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual statement in the form of a trial bal-

ance of its books specifying liabilities and assets, plus

such other information as may be called for. §26-904.

Other signicant features: Statute is silent.

FLORIDA

Fla. Stat. §§ 516.001 to 516.36 (Consumer

Finance Act).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Any lender except banks, savings banks, trust

companies, building and loan associations, credit

unions, or industrial loan and investment companies.

A pawnbroker may not be licensed to transact busi-

ness under the chapter. §516.02(4).

Licensure requirements and implications of licensure:

Must have license to engage in business of making

“consumer nance loans.” §516.02.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Stat-

ute applies to “consumer nance loans,” dened

as those of $25,000 or less at interest rate over 18%.

§§516.01(2).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed?



30% on rst $3,000.



24% on next $1,000.



18% on amount over $4,000.

§ 516.031(1).

What loan fees are allowed?



$25 credit investigation fee. §516.031(3)(a)(1).



Brokerage fee on a loan or line of credit of more

than $10,000.



Documentary excise tax and recording fees or non-

ling insurance not exceeding those fees.

§516.031(3)(a)(5), (6).

What types of insurance are allowed, and any limits the

lending statute places on charges? Credit property,

credit life, and disability insurance. §516.35.

Does statute prohibit all other fees besides those specically

allowed? Yes. §516.031(a).

Does statute restrict balloon payments or irregular pay-

ment schedules? Loan must be repaid in monthly

installments as nearly equal as mathematically practi-

cable. §516.36.

Any restrictions on renancing? If all or part of the

consideration for a new loan contract is the unpaid

principal balance of a prior loan with the licensee, the

principal amount payable under the new loan con-

tract may include not more than 60 days of unpaid

interest accrued on the prior loan. §516.031(5).

Any rebate requirements or restrictions on prepayment

penalties? Statute requires lender to permit repayment

at any time, with interest up to date of payment.

§516.15(3). Prepayment penalties are likely prohib-

ited because not authorized by §516.031.

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Security

interest in land is prohibited for loan of less than

$1,000. §516.031(1). Wage assignments are invalid.

§516.17.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Criminal usury statute, §687.071, prohib-

its charging more than 45% interest “[u]nless other-

wise specically allowed by law.”

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: No loan splitting allowed.

§§516.031(4); 516.21. Anti-evasion provisions, speci-

cally addressing sham purchases and sale of wages.

§§516.02(2), 516.26.

GEORGIA

Ga. Code Ann. §§ 7-3-1 to 7-3-29 (Industrial

Loan Act).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? All lenders making loans of $3,000 or less at

interest rates over 8% simple interest, except banks,

trust companies, real estate loan or mortgage compa-

nies, federal savings and loan associations, Georgia

building and loan associations, credit unions, pawn-

brokers, the state university system or its educational

units, to private colleges and universities in state, or

to student loan transactions of such entities. §§7-3-2,

7-3-6.

Licensure requirements and implications of licensure:

License required for the business of making loans of

$3,000 or less at an interest rate over 8% simple inter-

est, unless expressly exempted. §7-3-8. Loan made

without a required license is void. §7-3-29(a).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Applies

to loans of $3,000 or less at interest rate over 8%.

§§7-3-2, §7-3-6. Statute allows licensee to make loans

with terms of no more than 36 months and 15 days.

§7-3-14.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? 10% discount interest if

loan is for 18 months or less; otherwise, 10% add-on

interest. §7-3-14(1).

What loan fees are allowed?



Loan fee of 8% of the rst $600 of face amount of

contract plus 4% of the excess.



$3 maintenance charge for each month in loan con-

tract. §7-3-14(5).



Recording fees, or on loans over $100, non-ling

insurance if no more than those fees. §7-3-15.

What types of insurance are allowed, and any limits the

lending statute places on charges? Property insurance;

life, health, and accident insurance on the principal

party. §7-3-14(3).

Does statute prohibit all other fees besides those specically

allowed? Yes. §7-3-15.

Does statute restrict balloon payments or irregular

payment schedules? Statute is silent but §7-3-14(1)

refers to single-payment and installment payment

schedules.

Any restrictions on renancing? Lender may not charge

6% origination fee on that part of loan used to pay or

apply on a prior loan or installment of a prior loan

from the same lender to the same borrower made

within preceding 6 months (within the preceding 2

months if loan balance is $ 300 or less). §7-3-14(2).

Statute prohibits loan to pay balance due on note or

contract purchased by the lender until 90 days after

purchase. §7-3-16.

Any rebate requirements or restrictions on prepayment

penalties? Borrower may prepay all or part of unpaid

balance on any installment contract. Prepayment

penalties are likely prohibited because not autho-

rized by §7-3-15. Rule of 78s rebate of interest (sum

of the balances method), but no refund of less than

$1 need be made. §7-3-17. Upon renancing, lender

must also recalculate interest and charges, and if

they exceed 5% per month (the criminal usury cap),

lender must refund the excess. Ga. Comp. R. & Regs.

§120-1-10-.04.

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Statute is

silent

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Loans under this statute are not exempt

from the criminal usury statute, §7-4-18, which caps

interest at 5% per month, except that the criminal

usury statute does not apply to the maintenance

charges of $3 per month allowed by §7-3-14(5). §7-3-

14(2), (5).

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Commissioner may require annual reports

from lenders. §7-3-12.

Other signicant features: Loan splitting prohibited.

§7-3-15.

HAWAII

Haw. Rev. Stat. §§ 412:9-100 to 412:9-501

(“Article 9”) (Financial Service Loan Companies).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Depository and non-depository nancial ser-

vices loan companies. §§412:9-100, 412:9-101.

Licensure requirements and implications of licensure:

Must have license as nancial services loan company

to make loans at rates in excess of those permitted by

other law. §412:9-101.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Relevant

provisions apply to “consumer loan,” dened to

include only those for $25,000 or less or which are

secured by real property or the borrower’s dwelling.

§412:9-100. The maximum term of a precomputed

loan is 48 months. If term is more than 48 months,

simple interest rate must be charged. §412:9-302(b).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): This

statute (Article 9) applies to loans made at an interest

rate higher than permitted by law other than Article 9

(e.g., higher than permitted by the Interest and Usury

Law, ch. 478).

What rate of interest is allowed? May charge interest on

precomputed basis or simple interest basis (method

described in detail). §412:9-301.



For precomputed loan with term up to 48 months,

may charge interest paid or deducted in advance

(i.e., add-on or discount interest) at 14% per year

for rst 18 months of term, 10.5% per year for next

12 months of term, 7% per year for next 12 months

of term, and 4% per year for last 6 months of term.

For precomputed loan with term exceeding 48

months, 24% APR (as dened by TILA; i.e., actu-

arial). §§412-9:301, 412:9-302.



For simple interest loans: 24% simple interest, plus

any other charges that are excluded or excludable

from the determination of nance charge under

TILA. §412:9-302.

What loan fees are allowed? Fees, charges, and expenses

reasonably related to the consumer loan, such as

charges for credit reports, recording fees, wire trans-

fer fees, attorney fees for preparing loan documents,

and a variety of other listed fees that are actually paid

to third parties, afliates, or subsidiaries for services

actually rendered and without kickbacks. §412:9-

304(6). (Rules for loans secured by real property are

found in §412:9-304(5).) Nonrefundable discount,

points, loan fees, and origination charges are permit-

ted on simple interest loans, but must be included as

interest to determine compliance with the 24% cap;

these charges are not permitted if loan is precom-

puted and interest is determined by the discount or

add-on method. §412:9-304(4).

What types of insurance are allowed, and any limits the

lending statute places on charges? Credit-related insur-

ance products, including credit life insurance, credit

disability insurance, accident, and health or sickness

insurance, involuntary unemployment insurance,

personal property insurance, and mortgage protec-

tion insurance. §412:9-200(6). With commissioner’s

approval, may also sell accidental death and dismem-

berment insurance and auto club memberships and

home and automobile security plans, whether or not

connected with a loan. §412:9-201.

Does statute prohibit all other fees besides those specically

allowed? Yes. §412:9-304.

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Prepayment penalty is allowed for certain

loans secured by real estate, §412:9-304(2)(A), but

not on a variable rate or open-end loan, on a precom-

puted loan, or on a loan that is not secured by real

estate. §412:9-304(2). If original loan term is less than

60 months, Rule of 78s rebate; otherwise refund of

difference between interest originally charged and

actuarially earned. No refund need be made if less

than $1, and lender may retain at least $15. §412:9-

306. For precomputed loan with original term of 60

months or less, Rule of 78s rebate (sum of the balance

method); otherwise actuarial. No refund less than

$1 need be made, and lender may retain minimum

charge of $15. §412:9-306.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Loan may be

unsecured or secured by real or personal property of

any kind. §412:9-200(1).

Does statute prohibit unconscionable loan charges? Stat-

ute is silent, but §412:9-300 requires lender to make

loans that are consistent with “prudent lending prac-

tices” and “in compliance with all applicable federal

and state laws.”

Must lender underwrite or evaluate borrower’s ability to

repay? Statute allows lender to make loans “that are

consistent with prudent lending practices,” §412:9-

300, but otherwise is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable. (§412:9-303

exempts loans made under Article 9 from Hawaii’s

general usury statute, §§478-5, 478-6, which is a non-

criminal statute.)

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: Not applicable.

IDAHO

Idaho Code Ann. §§ 28-41-101 to 28-49-107

(Credit Code).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Prescribes maximum charges for all creditors,

except those excluded, extending credit as a regular

business. §28-41-107. Does not apply to licensed

pawnbrokers, extensions of credit to government

agencies, sales of insurance, or certain transactions

under public utility tariffs. §28-41-202. Banks are

exempt from licensing requirement. §28-46-301(2).

Licensure requirements and implications of licensure:

License required for business of making “regulated

consumer loans,” dened by §28-41-301(23), (28),

(35), (39), (44) as those payable in at least two install-

ments or for which a nance charge is imposed, or

taking assignments of and collecting on such loans.

Banks and other depository institutions, licensed

mortgage lenders, and governmental agencies are

exempt from licensing requirement. §28-46-301(2).

Debtor has right to sue for civil damages if lender

makes loan without required license. §28-45-201(a).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Regu-

lated closed-end consumer loan of $1,000 or less must

be payable over no more than 37 months; over 25

months if $300 or less. §28-43-310.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? Agreed rate.

§28-42-201(1).

What loan fees are allowed? Any other charge,

unless expressly prohibited or limited by the Act.

§28-42-201(1).

What types of insurance are allowed, and any limits the

lending statute places on charges? Generally allows

creditor to provide and charge for insurance. §28-44-

104. This authority is not explicitly limited to credit

insurance, although the statute specically mentions

credit life insurance, property insurance, and liability

insurance, §§28-44-202(1), 28-44-301(3), 28-44-303.

Property and liability insurance must cover prop-

erty related to the credit transaction. §§28-44-301.

28-44-303. Property insurance is allowed only if the

amount nanced is $500 or more, the value of the

property is $500 or more, and other conditions are

met. §28-44-303.

Does statute prohibit all other fees besides those specically

allowed? No. In addition to nance charge permit-

ted, creditor may contract for and receive any other

charge, except to the extent expressly prohibited or

limited by Act. §28-42-201(1).

Does statute restrict balloon payments or irregular pay-

ment schedules? With some exceptions, consumer has

right to renance any balloon payment in a regulated

consumer credit transaction. §28-43-307. Regulated

closed-end consumer loans of $1,000 or less must be

payable in substantially equal installments at equal

periodic intervals except to adjust for borrower’s sea-

sonal or irregular income. §28-43-310.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Statute allows prepayment penalty in

specied amount, but only for certain real-prop-

erty-secured transactions other than same-lender

renance; otherwise, may prepay in full at any

time without penalty. §28-42-306. Actuarial rebate

required if original loan term exceeds 61 months;

otherwise, Rule of 78s (sum of the balances method).

§28-42-307(3)(a), (b). For precomputed regulated

consumer loan, no rebate required if less than $1.00.

§28-42-307(1). In addition, for any non-open-end reg-

ulated consumer loan, creditor may retain minimum

charge of $5.00 if principal was $75.00 or less, or $7.50

if principal was more than $75. §28-42-307(2).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Wage assign-

ment is prohibited and unenforceable, but debtor

may revocably authorize deductions from earnings.

§28-43-304. Security interest in land is prohibited and

void unless principal exceeds $1,000. §28-43-309.

Does statute prohibit unconscionable loan charges? Yes.

§28-45-106.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report in form prescribed by adminis-

trator. §28-46-304.

Other signicant features: Not applicable.

ILLINOIS

815 Ill. Comp. Stat. Ann. § 205/4a

(Interest Act).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applies broadly to all installment lenders,

but interest rate limits do not apply to most banks or

to lenders licensed under Consumer Finance Act or

Installment Loan Act. §205/4a(a).

Licensure requirements and implications of licensure: Stat-

ute is silent.

Size and length of loans to which the statute applies,

and any restrictions in the statute on these features:

Applies to loans of $25,000 or less, payable in two

or more installments over no more than 181 months.

§205/4a(a).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute excepts purchase money, real estate mortgage

loans. §205/4a(a).

What rate of interest is allowed? 9% add-on interest per

year, but cap does not apply to interest rate charged

by: (1) any bank that has its main ofce or a branch in

the state; (2) a savings and loan association chartered

under state law, a savings bank chartered under state

law, a federal savings and loan association estab-

lished under the U.S. law and having its main ofce

in the state; or (3) any lender licensed under either

the Consumer Finance Act or the Consumer Install-

ment Loan Act. §205/4a(a)(i), (ii). Where the prin-

cipal of an installment loan is $300 or more and the

repayment period is 6 months or more, a minimum

charge of $15 may be collected instead of interest, but

only one minimum charge may be collected from the

same person during one year. §205/4a(b).

What loan fees are allowed? Recording fees; $5 service

charge if principal is $800 or less. §205/4a(b), (e).

What types of insurance are allowed, and any limits the

lending statute places on charges? Credit life insurance

and credit accident and health insurance, but if there

are two or more obligors, only one charge for credit

life insurance and credit accident and health insur-

ance may be made and only one of the obligors may

be required to be insured; property insurance on

security other than household goods, furniture, and

personal effects. §205/4a(c), (d).

Does statute prohibit all other fees besides those specically

allowed? Yes. §§205/4a(e), 205/5.

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent.

Any restrictions on renancing? For installment loan of

$300 or less payable over 6 months or more, only one

$15 minimum charge, and only one $5 service charge

may be collected during one year. §205/4a(b).

Any rebate requirements or restrictions on prepayment

penalties? May pay in full at any time. Lender must

make rebate of precomputed interest in accord with

§670/15(f)(3), which does not specify calculation

method, but §670/16(m) allows lender to disclose

that it is using Rule of 78s (sum of the balances

method). §205/4a(i). Statute refers to prepayment

penalties that lender may impose. §205/4a(f)(12).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Statute is

silent.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Criminal usury statute “does

not apply to any loan authorized to be made by any

person licensed under the Consumer Installment

Loan Act or to any loan permitted by Sections 4, 4.2

and 4a of the Interest Act or by any other law of this

State.” 720 Ill. Comp. Stat. Ann. §5/17-59(d).

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: Not applicable.

205 Ill. Comp. Stat. Ann. §§ 670/1 to 670/27

(Consumer Installment Loan Act).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Does not apply to banks, savings and

loan associations, savings banks, credit unions, or

licensees under the Residential Mortgage License

Act for residential mortgage loans made pursuant to

that Act. Does not apply to business loans or payday

loans. §670/21.

Licensure requirements and implications of licensure:

License required to engage in the business of making

loans of $40,000 or less at interest rates higher than

could be charged without a license. Payday lenders

are ineligible for licenses except to make vehicle title

loans. §670/1.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Amount

not exceeding $40,000. §§670/1, 670/15(a). Loan

contract must provide for repayment of principal

and charges within 181 months. §670/17. Term of

a “small consumer loan” (dened by §670/15(b) as

one for $4,000 or less at more than 36%, other than a

payday or vehicle title loan) cannot exceed 180 days.

§670/17.3(a).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? APR of 36%, except

that vehicle title loans have no cap. §671/16(g). For

“small consumer loan” of $1,500 or less, licensee

may charge interest at APR of no more than 99%

calculated in accordance with federal Truth in Lend-

ing Act. §670/17.2(a)(1).

What loan fees are allowed? Recording fees or non-ling

insurance up to that amount; $25 to prepare docu-

ments and review credit report. §670/15d.



For “small consumer loan” of $1,500 or less: an

acquisition charge of 10% of the amount nanced.

§670/17.2(a)(2).



For “small consumer loan” over $1,500 (but no

more than $4,000): an acquisition charge not to

exceed $100 for rst loan (reduced to $50 for rst

renance and to $25 for subsequent renances), and

a monthly installment account handling charge, not

to exceed the following amounts, but APR calcu-

lated in accordance with TILA cannot exceed 99%:

AMOUNT FINANCED PER MONTH CHARGE

$1,500.01–$1,600.00 $69.00

$1,600.01–$1,700.00 $72.00

$1,700.01–$1,800.00 $75.00

$1,800.01–$1,900.00 $78.00

$1,900.01–$2,000.00 $81.00

$2,000.01–$2,100.00 $84.00

$2,100.01–$2,200.00 $87.00

$2,200.01–$2,300.00 $90.00

$2,300.01–$2,400.00 $92.00

$2,400.01–$2,500.00 $94.00

$2,500.01–$2,600.00 $96.00

$2,600.01–$2,700.00 $98.00

$2,700.01–$2,800.00 $100.00

$2,800.01–$2,900.00 $102.00

$2,900.01–$3,000.00 $104.00

$3,000.01–$3,100.00 $106.00

$3,100.01–$3,200.00 $108.00

$3,200.01–$3,300.00 $110.00

$3,300.01–$3,400.00 $112.00

$3,400.01–$3,500.00 $114.00

$3,500.01–$3,600.00 $116.00

$3,600.01–$3,700.00 $118.00

$3,700.01–$3,800.00 $120.00

$3,800.01–$3,900.00 $122.00

$3,900.01–$4,000.00 $124.00

670/17.2(b). Acquisition charges for “small con-

sumer loans” are to be adjusted for ination.

§670/17.2(e). In addition, lender can charge $1 on

any “small consumer loan” for submitting loan infor-

mation into consumer reporting service. 670/17.2(c).

What types of insurance are allowed, and any limits the

lending statute places on charges? Credit life insurance,

credit accident and health insurance, involuntary

unemployment insurance, credit property insurance,

or other credit insurance policies. §670/15a. Lender

may require property damage insurance on real and

personal property that is collateral if loan principal

exceeds $500. §670/15b(a).

Does statute prohibit all other fees besides those specically

allowed? Yes. §670/15d.

Does statute restrict balloon payments or irregular pay-

ment schedules? Interest-bearing loans must be fully

amortizing and repayable in substantially equal

and consecutive weekly, biweekly, semimonthly, or

monthly installments. §670/15(e)(3). Precomputed

loans must be repayable in substantially equal and

consecutive weekly, biweekly, semimonthly, or

monthly installments, except that the rst installment

period may be up to one month and 15 days and the

rst installment amount may be correspondingly

larger, and monthly payment dates may be omit-

ted to accommodate seasonal income. §670/15(f)

(1). A “small consumer loan” must be fully amortiz-

ing and be repayable in its entirety in a minimum

of 6 substantially equal and consecutive payments

with a period of not less than 180 days to maturity.

§670/17.3(a).

Any restrictions on renancing? A licensee is prohibited

from renancing a “small consumer loan” during

the rst 75 days of the loan term. §670/17.3(c).

For “small consumer loan” of more than $1,500,

allowable acquisition charge is reduced to $50 for

rst renance and to $25 for additional renances.

§670/17.2(b)(1)(A), (C).

Any rebate requirements or restrictions on prepayment

penalties? Prepayment penalties are likely prohib-

ited because not authorized by §670/15d. Rule of

78s (sum of the balances method). §§670/15(f)(3),

670/16(m). However, for “small consumer loan,”

actuarial rebate is required of the unearned inter-

est or unearned portion of the monthly installment

account handling charge. §670/17.2(d).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Security inter-

est in real estate, other than judgment lien, is prohib-

ited for loan of $3,000 or less. §670/16b. At the time

a loan is made or within 20 days thereafter, a licensee

shall not accept a postdated check, or accept a check

and agree to hold it for a period of days before

deposit or presentment. §670/19.2. Lender may

not condition extension of credit on the borrower’s

repayment by preauthorized electronic fund trans-

fers. §670/15(d-5).

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Licensee is prohibited from making a “small

consumer loan” (one for $4,000 or less at more than

36%) to a consumer if the monthly payment exceeds

22.5% of consumer’s documented gross monthly

income. §670/17.4.

If state has a criminal usury law, is lending under this

statute exempt from it? Criminal usury statute “does

not apply to any loan authorized to be made by any

person licensed under the Consumer Installment

Loan Act or to any loan permitted by Sections 4, 4.2

and 4a of the Interest Act or by any other law of this

State.” 720 Ill. Comp. Stat. Ann. §5/17-59(d).

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report giving such relevant informa-

tion as the director may reasonably require. Director

may publish an annual analysis and recapitulation.

§670/11(b).

Other signicant features: Not applicable.

815 Ill. Comp. Stat. Ann. § 122/2-5 (Installment

loan provisions of Payday Loan Reform Act).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Any lender making payday loans. Banks,

savings banks, savings and loan associations, credit

unions, and insurance companies are exempt, but

their agents are subject to the Act other than the pro-

visions relating to nance charges. §122/1-15.

Licensure requirements and implications of licensure:

Licensure required. §122/3-3.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Install-

ment payday loan is dened as one for at least 112

days but no more than 180 days in which the creditor

requires a post-dated check, ACH access, or a wage

assignment. §§122/1-10, 122/2-5(c). Statute does not

explicitly cap the amount of the loan, but provides an

implicit cap by limiting the amount of the payment

coming due in rst month of the loan, when com-

bined with the payment amount on all other payday

loans, to 22.5% of borrower’s gross monthly income.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? $15.50 per $100.00 per

payment period, computed on outstanding balance.

§122/2-5(e-5).

What loan fees are allowed? $1 verication fee for

checking payday loan database. §122/2-10(a-5).

What types of insurance are allowed, and any limits the

lending statute places on charges? No insurance may be

sold in connection with a loan. §122.4-5(11).

Does statute prohibit all other fees besides those specically

allowed? Yes. §122/2-10(b).

Does statute restrict balloon payments or irregular pay-

ment schedules? Loan must be repayable in substan-

tially equal installments due at intervals of at least 13

days but no more than one month (with exception for

minor irregularities in rst installment). §122/2-5(c)(i).

Any restrictions on renancing? Only one renancing

allowed, and total period of indebtedness may not

exceed 180 days; otherwise, rollovers are prohibited.

§§122/2-5(c)(ii), 122/2-30. Two-day waiting period

between loans. §122/2-5(c)(iii).

Any rebate requirements or restrictions on prepayment

penalties? Actuarial rebate required. §122/2-5(e-5).

Consumer has right to prepay in increments of $5 of

more without penalty. §122/2-35(g).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Security inter-

est in personal property prohibited. §122/2-5(f).

Creditor may take postdated check or authorization

to debit borrower’s account. §§§122/1-10 (deni-

tion of “payday loan”), 122/2-35. No other security is

allowed. §122.4-5(6), (13).

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Loan payments must not exceed specied per-

centage of borrower’s income. §122/2-5(e).

If state has a criminal usury law, is lending under this

statute exempt from it? Criminal usury statute “does

not apply to any loan authorized to be made by any

person licensed under the Consumer Installment

Loan Act or to any loan permitted by Sections 4, 4.2

and 4a of the Interest Act or by any other law of this

State.” 720 Ill. Comp. Stat. Ann. §5/17-59(d).

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report required, including number

and total dollar amount of loans; maximum, mini-

mum, and average dollar amount; average term and

APR; and default rate. §122/2-55.

Other signicant features: Anti-evasion provisions.

§§122/1-15(b), 122/4-5(2). Late charges and collec-

tion charges prohibited. §122/4-5(14).

INDIANA

Ind. Code §§ 24-4.5-1-101 to 24-4.5-6-204

(Uniform Consumer Credit Code).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applies broadly to all creditors, except:



Extensions of credit to government or governmen-

tal agencies.



Most sales of insurance by insurers.



Certain transactions under public utility, municipal

utility, or common carrier tariffs.



Rates and charges of licensed pawnbrokers.



Non-consumer loans.



Installment agreements for purchase of home fuels

in which a nance charge is not imposed.



Federally-related student loans.



Certain transactions in securities or commodities

accounts.



Certain loans by non-prot organizations or made

in connection with state or federal programs.

§ 24-4.5-1-202.

Licensure requirements and implications of licensure:

License required to engage regularly in the making

of non-mortgage consumer loans, taking assignments

of these loans in Indiana or collecting on them in

Indiana, but licensing requirement does not apply

to lending by depository institutions, their subsid-

iaries, or credit union service organizations, or to

collection by licensed collection agency. §24-4.5-3-

502. Loan made without a required license is void.

§24-4.5-5-202(2).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Relevant

statutory provisions apply to any “consumer loan,”

dened to exclude those exceeding $53,500 (adjusted

for ination) unless the debt is secured by an interest

in land or by personal property used or expected to

be used as the debtor’s principal dwelling. §24-4.5-

1-301.5(9). Supervised closed-end loans (dened by

§24-4.5-3-501(1) as those at more than 25%) of $4,000

or less must be payable over no more than 37 months

if principal is more than $1,100 (adjusted for ination

from $300 pursuant to 750 Ind. Admin. Code §1-1-

1), or over no more than 25 months if the principal is

$1,100 or less. §24-4.5-3-511(1).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? For consumer loans

other than supervised loans: 25%. §24-4.5- 3-201. For

supervised loans: Either:



36% on rst $2,000 (adjusted for ination), 21% on

next $2,000 (adjusted for ination), and 15% on

remainder; or



25%.

§ 24-4.5-3-508(1), (2).

What loan fees are allowed?



Ofcial fees and taxes.



Charges for other benets, including insurance,

conferred on debtor, if the department determines

that the benets are of value to the debtor and if the

charges are reasonable in relation to benets.



Origination fee of $50.

§§ 24-4.5-3-201(8)(b), 24-4.5-3-202,

24-4.5-3-508(8).

What types of insurance are allowed, and any limits the

lending statute places on charges? Property or liability

insurance, credit insurance providing life, accident,

unemployment or other loss of income, or health

coverage. §24-4.5-3-202(2). Property insurance is

allowed only if amount nanced is $1,110 or more

(adjusted for ination from $300 pursuant to 750 Ind.

Admin. Code §1-1-1), the value of the property is

$1,100 or more (adjusted for ination), and other con-

ditions are met. §24-4.5-4-301.

Does statute prohibit all other fees besides those specically

allowed? Debtor is not required to pay a charge in

excess of that allowed by the Code. §24-4.5-5-202(3).

Does statute restrict balloon payments or irregular pay-

ment schedules? Debtor has the right to renance

any balloon payment without penalty, on terms no

less favorable than the original terms, except where

payment schedule was adjusted to the seasonal or

irregular income of the debtor, and except for loans

that are interest-only until nal payment. §24-4.5-3-

402. Supervised closed-end loans of $4,000 or less are

payable in a single installment or shall be scheduled

to be payable in substantially equal installments at

equal periodic intervals, except where payments are

adjusted to the seasonal or irregular income of the

debtor. §24-4.5-3-511(1).

Any restrictions on renancing? Statute limits

origination fees for renances. §24-4.5-3-201(10),

24-4.5-3-508(10).

Any rebate requirements or restrictions on prepayment

penalties? Except where loan is primarily secured by

land, debtor may prepay in full at any time with-

out penalty. §24-4.5-3-209. Rule of 78s rebate (sum

of the balances method), but actuarial if loan term

exceeds 61 months. No rebate required if less than $1.

Origination fee need not be rebated, and lender that

does not charge origination fee may retain minimum

nance charge of $30 (adjusted for ination pursu-

ant to §24-4.5-1-106). §§24-4.5-3-201(9), 24-4.5-3-210,

24-4.5-3-508(7).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Wage assign-

ments prohibited and unenforceable, but employee

may authorize deductions from earnings if revocable.

§24-4.5-3-403. For supervised loan where principal is

$4,000 or less (adjusted for ination pursuant to 750

Ind. Admin. Code §1-1-1), security interest in land is

prohibited and void. §24-4.5-3-510.

Does statute prohibit unconscionable loan charges? Yes.

§24-4.5-5-108.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Indiana’s criminal usury law

does not exempt UCCC, but it criminalizes charging

more than 45% interest only if lender has a reputation

for using violence or other criminal means to collect

the debt. §24-4.5-5-107. See also §35-45-7 (criminaliz-

ing lending at more than two times 36% interest).

Reporting requirements, including detail about what

must be reported and whether there are any requirements

that the state agency review or take other steps regarding

the reports: Annual report as required by the depart-

ment. §24-4.5-3-505(5). Since 2000 the department

has accepted a third-party CPA annual report either

at the review or audited level at time of application

and upon request by the DFI showing a minimum

net worth of $100,000 and minimum liquid assets of

$50,000.

Other signicant features: Loan-splitting prohibited.

§24-4.5-3-509.

IOWA

Iowa Code §§ 536.1 to 536.30 (Regulated

Loan Act).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Excludes banks, trust companies, building

and loan associations, credit unions, licensed pawn-

brokers, and domestic corporations operating under

chapter 536A (Industrial Loan Law). §536.20.

Licensure requirements and implications of licensure:

License under the Regulated Loan Act is required in

order to make loans of $54,600 or less (adjusted for

ination) at rate greater than a non-licensee could

charge, but a “supervised nancial organization”

(i.e., a depository institution), a licensee under the

Industrial Loan Law, or a lender that enters into

fewer than 10 supervised loans per year in the state

and has neither an ofce physically located in the

state nor engages in face-to-face solicitation in the

state need not be licensed. License also required to

collect on supervised loans, with three-month grace

period. §536.1 (incorporating the exclusions from

licensure found in §537.2301).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Stat-

ute applies to loans of no more than the “threshold

amount” ($54,600, adjusted for ination), or less.

§§536.1, 537.1301.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? Until superintendent

sets different rates, statute allows 36% on rst $150;

24% on next $150; 18% on amount over $300 but not

exceeding $700; and 12% on remainder. §536.13(4).

For loans of $10,000 or less, superintendent has

adopted a rule allowing 36% on rst $1,000; 24% on

amount exceeding $1,000 but not exceeding $2,800;

and 18% on remainder up to $10,000. Iowa Admin.

Code r. 187-15.5(536). For loans over $10,000, the

maximum rate of interest or charges a licensee may

charge shall be the greater of the rate permitted by

chapter 535 (2 percentage points above a Treasury bill

rate, §535.2(3)(a)(1)) or the rate authorized for super-

vised nancial organizations by chapter 537 (21%).

§536.13(7a).

What loan fees are allowed? Statute’s limits, summa-

rized in the preceding entry, apply to “interest or

charges.”

What types of insurance are allowed, and any limits the

lending statute places on charges? Credit life and acci-

dent and health insurance; property and liability

insurance. §§536.26, 536.27.

Does statute prohibit all other fees besides those specically

allowed? Statute is silent.

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Must permit prepayment in any amount

on any loan at any time. §536.14(1). Actuarial rebate

required, but lender may retain minimum charge of

$5.00 to $7.50 if loan is prepaid in full. §536.13 (incor-

porating UCCC rules).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Iowa’s UCCC

limits apply. §536.13(7)(b).

Does statute prohibit unconscionable loan charges?

Unconscionability provision of Iowa’s UCCC applies.

§536.13(7)(b).

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent, but probability of repayment

is a listed factor in determining unconscionability.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report giving such relevant infor-

mation as superintendent reasonably may require.

Superintendent shall publish annual analysis and

recapitulation. §536.11. Superintendent shall make

an annual report containing a summary of license

applications approved or denied by the superinten-

dent; a summary of the assets, liabilities and capital

structure of all licensees, and volume of consumer

installment of credit outstanding per licensee; an

estimate of the disbursements of agency funds for

consumer credit protection; and other required or

appropriate information. §536.29.

Other signicant features: Not applicable.

Iowa Code §§ 536A.1 to 536A.32 (Industrial

Loan Law).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Industrial loan companies are dened as cor-

porations operating under the provisions of this law

and engaged in the business of loaning money and

charging interest or other compensation. §536A.2(6).

Does not apply to:



Banks, trust companies, building and loan associa-

tions, savings and loan associations, insurance com-

panies, regulated loan companies organized under

chapter 536, or credit unions.



Lenders that make only rst mortgage real estate

loans.



Licensed real estate brokers or salespersons.



Persons engaged exclusively in purchasing com-

modity nancing or commercial paper.



Pawnbrokers.



Loans to corporations.

§ 536A.5.

Licensure requirements and implications of licensure: For

a loan other than a consumer loan, person shall not

engage in the business of operating an industrial loan

company in the state without a license. For a con-

sumer loan, must have license in order to engage in

the business of operating an industrial loan company

without a license, but a “supervised nancial orga-

nization” (i.e., a depository institution), a licensee

under the Regulated Loan Act, or a lender that enters

into fewer than 10 supervised loans per year in the

state and has neither an ofce physically located in

the state nor engages in face-to-face solicitation in the

state need not be licensed. §536A.3 (incorporating

the exclusions from licensure found in §537.2301).

Individuals, partnerships, nonprot organizations,

and unincorporated associations are ineligible for

licensure. §536A.4.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute is

silent.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? 10% add-on or dis-

count interest per year (10 cents per hundred per

year). §536A.23(1)(a)(1).

What loan fees are allowed? Service charge of $1 for

each $50 of the amount of the note, up to $120.

§536A.23(1)(b).

What types of insurance are allowed, and any limits the

lending statute places on charges? Insurance on real or

personal property collateral; credit life and accident

and health insurance. §536A.23(1)(c).

Does statute prohibit all other fees besides those specically

allowed? Statute is silent.

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent, except for dening

industrial loan company as one that makes loans that

are payable in one payment or in weekly, monthly or

other periodic installments. §536A.2(6).

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Borrower may prepay in whole or part at

any time. §536A.26. Actuarial rebate required, but

no rebate less than $1.00 need be made, and credi-

tor may retain a minimum charge of $5.00 if amount

nanced was $75.00 or less, and $7.50 if amount

nanced was more than $75.00. §537.2510. §536A.31

(incorporating UCCC rules).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Iowa’s ICCC

limits apply. §536A.31.

Does statute prohibit unconscionable loan charges?

Unconscionability provision of Iowa’s UCCC applies.

§536A.31.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent, but probability of repayment

is a listed factor in determining unconscionability.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report showing assets and liabilities;

operating statement showing income, expenses, and

net prot; and other relevant information as super-

intendent shall reasonably require. Superintendent

shall publish annual analysis and recapitulation of

such reports. §536A.14. Superintendent shall make

annual report containing: a summary of license appli-

cations approved or denied; a summary of the assets,

liabilities and capital structure of all licensees, and

volume of consumer installment credit outstand-

ing per licensee; an estimate of the disbursements

of agency funds for consumer credit protection; and

other required or appropriate information. §536A.29.

Other signicant features: Iowa UCCC applies to con-

sumer loans made by licensees. §536A.31.

Iowa Code §§ 537.1101 to 537.8101

(Consumer Credit Code).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applies generally to entities extending credit,

§537.1108, but excludes:



Extensions of credit to government or governmen-

tal agencies.



Non-installment sales of insurance.



Transactions under public utility or common carrier

tariffs in some circumstances.



Transactions in securities or commodities accounts.



Pawnbrokers, as to most provisions.

§ 537.1202.

Licensure requirements and implications of licensure:

License required to make supervised loans (dened

by §537.1301(46) as consumer loans that exceed the

usual rate cap) or undertake their collection (with

3-month grace period) unless person is a “supervised

nancial organization” (i.e., a depository institu-

tion) or is licensed under the Regulated Loan Act

or Industrial Loan Law or enters into fewer than 10

supervised loans per year in the state and has neither

an ofce physically located in the state nor engages

in face-to-face solicitation in the state. §537.2301(2),

(3). Consumer has a claim for statutory and actual

damages if creditor makes supervised loan without

required license. §537.5201(1)(a)(1).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Closed-

end supervised loans of $1,000 or less must be pay-

able over no more than 37 months, or over 25 months

if the amount nanced is $300 or less. However,

lender may make a closed-end loan that is repay-

able in a single payment if the amount nanced does

not exceed $1,000 and if the nance charge does

not exceed the rate permitted by §537.2401(1) to

be charged by a supervised nancial organization.

§537.2308.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): “Con-

sumer loan” does not include a debt secured by a

rst lien on real property. §537.1301(15)(b)(2).

What rate of interest is allowed? For closed-end loan

not secured by a motor vehicle certicate of title, any

lender may charge the greater of maximum allowed

by state or federal law for similar lenders, and super-

vised lender has additional option of charging 21%.

§537.2401(1).

What loan fees are allowed? Ofcial fees and taxes; reg-

istration, certicate of title or license fees; charges for

other benets if valuable to consumer, reasonably

priced, and approved by rule. §537.2501(1). For con-

sumer loan of $3,000 or less with term of 12 months

or less that is not used for purchase of a motor

vehicle and is not secured by borrower’s dwelling,

depository institution may charge application fee of

10% or $30, whichever is less. §537.2501(1)(j).

What types of insurance are allowed, and any limits the

lending statute places on charges? Property or liability

insurance and credit life, accident, health, and unem-

ployment insurance. §537.2501(2).

Does statute prohibit all other fees besides those specically

allowed? Consumer is not obligated to pay a charge in

excess of that allowed by the Code. §537.5201(2).

Does statute restrict balloon payments or irregular pay-

ment schedules? Closed-end supervised loans of

$1,000 or less must be payable in substantially equal

installments at substantially equal periodic intervals

except to accommodate debtor’s seasonal or irregu-

lar income. However, lender may make a closed-end

credit loan that is repayable in a single payment if

the amount nanced does not exceed $1,000 and if

the nance charge does not exceed 21% or maximum

allowed by state or federal law for similar lenders.

§537.2308 (incorporating §537.2401 by reference).

Consumer has right to renance any balloon pay-

ment on terms no less favorable than original terms,

except where (1) payment was adjusted to debtor’s

seasonal or irregular income or scheduled payments

on other obligations; (2) loan exceeds $5,000 and is

secured by an interest in land; (3) loan is secured by a

motor vehicle certicate of title; or (4) administrator

has adopted additional exceptions. §537.3308.

Any restrictions on renancing? Where nance charge

exceeds 18% per year, rate upon renancing is lim-

ited to original rate. §537.2504.

Any rebate requirements or restrictions on prepayment

penalties? Consumer may prepay in full at any time.

§537.2509. Actuarial rebate required, but no rebate

less than $1.00 need be made, and creditor may retain

a minimum charge of $5.00 if amount nanced was

$75.00 or less, and $7.50 if amount nanced was more

than $75.00. §537.2510.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? For super-

vised loan with nance charge exceeding 15% and

amount nanced of $2,000 or less, security interest in

real property used as a residence for the consumer or

the consumer’s dependents is prohibited and void.

§537.2307. For supervised loan, non-purchase money

security interest in the clothing, dining table and set

of chairs, refrigerator, heating stove, cooking stove,

radio, beds and bedding, couch, two living room

chairs, cooking utensils, or kitchenware used by the

consumer, the consumer’s dependents, or the family

with whom the consumer resides is prohibited and

void. §537.3301. Wage assignment is prohibited and

unenforceable, but borrower may revocably autho-

rize payroll deductions. §537.3305.

Does statute prohibit unconscionable loan charges? Yes.

§537.5108.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent, but probability of repayment

is a listed factor in determining unconscionability.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what

must be reported and whether there are any requirements

that the state agency review or take other steps regard-

ing the reports: Annual report in form prescribed by

licensing authority relating to all supervised loans

made by licensee. §537.2304(2). Administrator must

make annual report to state legislature on the opera-

tion of the agencies charged with administering this

law, and on the problems of persons of small means

obtaining credit. §537.6104(5).

Other signicant features: Loan-splitting prohibited.

§537.3304.

KANSAS

Kan. Stat. Ann. §§ 16a-1-101 to 16a-9-102

(Consumer Credit Code).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Act applies to “consumer credit transactions,”

broadly dened. §16a-1-301(5). Excludes extensions

of credit to government or governmental agencies,

non-installment sales of insurance, certain transac-

tions under public utility or common carrier tariffs,

licensed pawnbrokers (except for disclosure require-

ments), and transactions covered by the insurance

premium nance act. §16a-1-202.

Licensure requirements and implications of licensure:

Must be licensed engage in the business of making

supervised loans (ones in which APR exceeds 12%)

or taking assignments of them and collecting on

them (with 3-month grace period), unless lender is a

supervised nancial organization (dened by §16a-

1-301(44) as a depository institution). §16a-2-301(1).

Supervised loan made without required license is

void. §16a-5-201(2).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Parts 3

and 4, which include the installment lending provi-

sions, apply to “consumer loans,” dened by §16a-1-

301(17) to exclude: (1) loans, other than those secured

by land, where the amount nanced exceeds $25,000;

(2) certain rst mortgage loans; and (3) loans from

IRS-qualied pension plans. §16a-2-102. Closed-end

consumer installment loan of $1,000 or less at more

than 12% must be payable over no more than 37

calendar months, or over no more than 25 months if

amount nanced is $300 or less. §16a-2-308.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? 36% on rst $860, and

21% on remainder. §16a-2-401(2), (6).

What loan fees are allowed?



Ofcial fees and taxes.



Charges for other benets if valuable to consumer,

reasonable in price, and identied by administra-

tor’s rules.



Prepaid nance charge of 2% of amount nanced or

$100, whichever is less (but a higher amount if con-

sumer loan is rst or second mortgage or is secured

by manufactured home). §16a-2-401.

§ 16a-2-501.

What types of insurance are allowed, and any limits the

lending statute places on charges? Statute generally

authorizes creditor to provide and charge for insur-

ance, including vendor’s single interest insurance if

insurance has no right of subrogation against con-

sumer, property insurance and liability insurance

on property related to the credit transaction, and

credit life, accident and health, and loss of income

insurance, but not other insurance protecting credi-

tor against consumer’s default or other credit loss.

§§16a-2-501(2), 16a-4-104(1), 16a-4-301, 16a-4-303.

Creditor may charge for property insurance only if

amount nanced is $900 or more and the property is

worth $900 or more. §16a-4-301.

Does statute prohibit all other fees besides those specically

allowed? Consumer is not required to pay any charge

in excess of that allowed by the Act, §16a-5-201(3),

but otherwise statute is silent.

Does statute restrict balloon payments or irregular pay-

ment schedules? Closed-end consumer installment

loan of $1,000 or less at more than 12% must be pay-

able in substantially equal installments at substan-

tially equal periodic intervals except to accommodate

debtor’s seasonal or irregular income. §16a-2-308.

Consumer has right to renance any balloon pay-

ment without penalty on terms no less favorable

than the original terms, except for loan secured by

real estate mortgage or where payment schedule was

adjusted to debtor’s seasonal or irregular income.

§16a-3-308.

Any restrictions on renancing? If loan is renanced

within rst 12 months, prepaid nance charge is

limited to the lesser of $100 or 2% of the additional

amount nanced. §16a-2-401(9).

Any rebate requirements or restrictions on prepayment

penalties? Consumer may prepay in full at any time

without penalty. §16a-2-509. Finance charge must be

computed by actuarial method, §16a-2-103(1), and

statute makes no provision for any non-actuarial

calculation for rebate due upon prepayment. Upon

prepayment in full, but not upon a renancing, of a

closed-end transaction, creditor may retain a mini-

mum charge of $5.00 if amount nanced was $75.00

or less, or $7.50 if amount nanced was more than

$75.00. §16a-2-510(1).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Security

interest in land is prohibited and void for consumer

loan where nance charge exceeds 12% and amount

nanced is $3,000 or less. §16a-2-307. Wage assign-

ment is prohibited and unenforceable, but con-

sumer may revocably authorize payroll deductions.

§16a-3-305.

Does statute prohibit unconscionable loan charges? Yes:

§16a-5-108.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report in form prescribed by adminis-

trator. §16a-2-304(5).

Other signicant features: Loan-splitting prohibited.

§16a-3-304.

KENTUCKY

Ky. Rev. Stat. Ann. §§ 286.4-410 to 286.4-991

(West) (Consumer Loan Companies).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Applies generally to lenders other than

banks, savings banks, trust companies, building and

loan associations, cooperative marketing associa-

tions, credit unions, loan and investment companies,

and licensed pawnbrokers. §286.4-410(2).

Licensure requirements and implications of licensure:

Must have license to engage in business of making

loans of $15,000 or less at rate of interest greater than

otherwise permitted by law. §286.4-420.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: $15,000

or less. §§286.4-420, 286.4-530(1). For loans of $3,000

or less, term may not exceed 60 months and 15 days.

For loans exceeding $3,000, term may not exceed 120

months. §286.4-580(2).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed?



36% if loan is for $3,000 or less.



24% if loan is for more than $3,000.

§286.4-530(1).

What loan fees are allowed?



Recording fees, or premium for non-ling insur-

ance if no more than those fees.



A credit investigation charge of $1.50 for each

$50.00 or fraction thereof of the principal, but only

on rst $2,000.00 and only if loan is made as a

result of the investigation. §286.4-533(4).

What types of insurance are allowed, and any limits the

lending statute places on charges? Property insurance

on tangible personal property collateral other than

household goods, but only if loan exceeds $300.

§286.4-560(1). Insurance on the life, unemploy-

ment, health, and/or disability of the borrower(s).

§286.4-560(2).

Does statute prohibit all other fees besides those specically

allowed? Yes. 286.4-530(10).

Does statute restrict balloon payments or irregular pay-

ment schedules? Substantially equal installments at

approximately equal periodic intervals, but lender

can make adjustments for borrower’s seasonal

income. §286.4-580(2).

Any restrictions on renancing? For same-lender re-

nance, principal cannot include unpaid charges that

have accrued more than 60 days before the making of

the new loan. §286.4-530(9).

Any rebate requirements or restrictions on prepayment

penalties? Prepayment penalties are likely prohibited

because not authorized by §286.4-530(10). Rule of 78s

(sum of the balances method), but no refund of less

than $1.00 need be made, and no refund for partial

prepayments need be made. §286.4-530(2), (6).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Wage assign-

ments are regulated but not prohibited. §286.4-570.

No licensee shall take any mortgage or other lien

instrument upon real estate as security where prin-

cipal is $3,000 or less, unless such lien is subject to a

prior mortgage. §286.4-580(3).

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report giving information on nancial

condition of licensee and other relevant information

as the commissioner may reasonably require. Com-

missioner shall publish annual analysis and recapitu-

lation. §286.4-590.

Other signicant features: Loan splitting prohibited.

§286.4-530(11). Wage assignments are limited to 10%

of paycheck. §286.4-570.

Ky. Rev. Stat. Ann. §§ 286.7-410 to 286.7-990

(West) (Industrial Loan Corporations).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Any ve persons may organize an industrial

loan company and apply for a certicate of approval

to do business. §§286.7-410(2), 286.7-420, 286.7-450.

Licensure requirements and implications of licensure:

Cannot engage in the business of making loans at a

rate of interest in excess of the legal rate of interest

prescribed in §360.010 without obtaining certicate

from state unless authorized by other specic statu-

tory provisions. §286.7-540.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Principal

may not exceed $7,500, and loan must be repayable

over no more than 5 years and 32 days. §286.7-

460(1). However, limit on amount of loan is $10,000 if

rates allowed for banks are charged. §286.7-460(4).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? $7 per $100 add-on

or discount interest. §286.7-460(1). May also charge

interest on loans or extensions of credit in the

same manner and at the same rate as is permitted

by §286.3-215 for banks and trust companies ($8

per $100), as long as loan does not exceed $10,000.

§286.7-460(4).

What loan fees are allowed? $1 for each $50 or fraction

thereof loaned, for expenses such as investigation

and document preparation, but only on the rst

$2,000 loaned, and only if loan is made as a result

of an examination or investigation; recording fees.

§§286.7-460(3), 286.7-480.

What types of insurance are allowed, and any limits the

lending statute places on charges? Property insurance

on tangible personal property, except household

goods, offered as security for a loan not exceeding

$7,500; life insurance on one borrower; accident and

health insurance. §286.7-480.

Does statute prohibit all other fees besides those specically

allowed? Yes. §286.7-480.

Does statute restrict balloon payments or irregular pay-

ment schedules? Loans must be repayable in sub-

stantially equal monthly or weekly installments.

§286.7-460(1).

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Prepayment penalties are likely prohibited

because not authorized by §286.7-480. Borrower has

right to repay loan in whole or in part at any time.

Rule of 78s rebate, but lender may retain $10 to cover

its acquisition costs and need not make rebate of less

than $1. §286.7-500(2).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? May not

take wage assignment or rst lien on real estate

other than judgment lien, but may take junior lien.

§286.7-510(1).

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report giving information on com-

pany’s nancial condition and other relevant infor-

mation as commissioner may reasonably require.

§286.7-530(3).

Other signicant features: Loan splitting prohibited.

§286.7-510(2).

LOUISIANA

La. Rev. Stat. Ann. §§ 9:3510 to 9:3568

(Consumer Credit Law).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Relevant provisions apply to consumer loans,

broadly dened by §9:3516(14). Law does not apply

to:



Extensions of credit to organizations, including

government or governmental agencies.



Most non-installment sales of insurance.



Certain transactions under public utility or

common carrier tariffs.



Motor vehicle credit transactions subject to the

Motor Vehicle Sales Finance Act.



Credit unions.



Pawnbrokers.



Extensions of credit for business, commercial, or

agricultural purposes.



Federally related mortgage loans.

§ 9:3512.

Licensure requirements and implications of licensure:

May not contract more than 4 transactions over any

calendar year without obtaining license. Creditor

with in-state ofce must also obtain license in order

to take assignments of and undertake direct collec-

tion of payments from or consumer loans and collect

them (with three-month grace period). §§9:3514,

9:3557. The following are exempt from the licensing

requirement:



Banks, savings and loan associations, and similar

institutions.



A subsidiary of a state-chartered bank, savings and

loan association, or similar institution if the parent

owns 80% or more of it.



A trust administered by a bank or a bank trust

department.



Governmental entities.



Insurance companies making life insurance loans to

policyholders.



A qualied pension plan when extending credit to

a plan participant.



A bona de pledgee of a consumer credit transac-

tion to secure a bona de loan thereon.



A seller or other creditor renancing a retail install-

ment transaction subject to the Motor Vehicle Sales

Finance Act.



A creditor having no ofce within the state that

offers credit to Louisiana consumers through the

mails and other means of interstate commerce.



Persons whose lending activities pertain to certain

federally related mortgage loans, unless otherwise

provided by rule.

§ 9:3560.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute is

silent.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? Maximum nance

charge for loan not made with a lender credit card:



36% per year on rst $1,400;



27% per year on amount exceeding $1,400 but not

exceeding $4,000;



24% per year on amount exceeding $4,000 but not

exceeding $7,000; and



21% per year on remainder.

§ 9:3519(A). In lieu of all other nance charges,

lender may contract for and receive a minimum

loan nance charge of not more than $15 when the

amount advanced does not exceed $200 or $25 when

the amount advanced exceeds $200. §9:3519(E).

What loan fees are allowed? Lender may charge:



$50 origination fee. §9:3530(A).



Non-real estate related notary fees, up to $15.

§9:3530(B).



$20 documentation fee. §9:3530(C).



License tag fees; electronic lien and title fees.

§9:3530(F).

What types of insurance are allowed, and any limits the

lending statute places on charges? Any type of credit

insurance (dened by §22:47(16) to include credit

life, credit health, and disability insurance, accidental

death and dismemberment insurance whether or not

the benets are payable toward the credit obliga-

tion, credit property and casualty insurance, credit

unemployment insurance, vendors single interest

insurance, vendors dual interest insurance, credit

re insurance, and GAP insurance authorized by the

state insurance code. §§9:3542, 9:3543.

Does statute prohibit all other fees besides those specically

allowed? Yes. §9:3554.1(B).

Does statute restrict balloon payments or irregular

payment schedules? Statute is silent.

Any restrictions on renancing? Statute restricts charg-

ing of $50 origination fee when loan is renanced

within rst 30 days. §9:3530(A).

Any rebate requirements or restrictions on prepayment

penalties? May prepay in full at any time. §9:3531(A).

Rule of 78s rebate (sum of balances method), but rst

deduct $25 if prepayment occurs within rst half of

contract term, and no rebate less than $1 is required.

Prepaid nance charges need not be rebated upon

prepayment in full of a simple interest transaction

if original amount nanced under the transaction

was $10,000 or more, term was 36 months or longer,

and the prepaid nance charges did not exceed 5%.

§9:3532.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Statute is

silent.

Does statute prohibit unconscionable loan charges? Yes.

§9:3551.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: Loan-splitting prohibited.

§9:3535.

MAINE

Me. Rev. Stat. Ann. tit. 9-A §§ 2-101 to 6-113

(Consumer Credit Code).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applies to “consumer loans,” broadly dened

by §1-301(14). Does not apply to:



Non-installment sales of insurance.



Provision of public utility services.



Rates and charges for credit unions and pawnbro-

kers that are set by other law.



Transactions in securities or commodities accounts.



Certain educational loans.



Certain transactions that are secured by rst mort-

gages or that nance or renance the acquisition or

initial construction of real estate.



No-interest loans by non-prot housing

organizations.



Other transactions identied by rule.

§ 1-201.

Licensure requirements and implications of licensure:

To make supervised loans (dened by §1-301(40)

as those at more than 12.25% or that are secured by

real estate), or take assignments of them and collect

on them, must be supervised nancial organization

(dened by §1-301 as banks and other depository

institutions, nondepository trust companies, unin-

sured banks, and merchant banks) or have license.

§2-301. If lender is unlicensed, debtor is not obli-

gated to pay any application fee, prepaid nance

charge or closing cost, nor the loan nance charge

owed for the rst 12 months of the loan, and may

recover any part that has been paid. §5-201.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Deni-

tion of “consumer loan” excludes those for more

than $50,000 (adjusted for ination) unless the loan

is secured by manufactured housing or an interest in

land. §1-301(14). Supervised closed-end installment

loans of $1,000 or less must be payable over no more

than 25 months. §2-308.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed?



30% per year on rst $2,000;



24% on next $2,000; and



18% on remainder.

However, if amount nanced exceeds $8,000, lender

may not charge more than 18%. §2-401(2). Lender

may contract for minimum charge of not more than:



$5 when the amount nanced does not exceed $75;



$15 when the amount nanced exceeds $75, but is

less than $250; or



$25 when the amount nanced is $250 or more.

§ 2-401(7).

What loan fees are allowed? For consumer credit trans-

action or open-end credit plan, lender may charge:



Ofcial fees and taxes.



Charges for other benets authorized by rule, if

valuable to consumer and reasonable in relation to

benets or of a type that is not for credit.

§ 2-501.

What types of insurance are allowed, and any limits the

lending statute places on charges? Creditor may charge

for insurance, including vendor’s single interest

insurance with respect to which insurer has no right

of subrogation against consumer, property insurance

on property related to the credit transaction, liability

insurance, and consumer credit insurance provid-

ing life, accident or health coverage or involuntary

unemployment coverage, but not other insurance

protecting creditor against consumer’s default or

other credit loss. §§2-501, 4-104. Charging for credit

accident and health is prohibited unless there is a

minimum payment of $30 per month or a loan dura-

tion of at least 18 months. §4-104(3). Except pursu-

ant to open-end credit, creditor may not charge for

property insurance unless amount nanced is $1,400

or more and the cash price of the item or property is

$1,400 or more. §4-301.

Does statute prohibit all other fees besides those specically

allowed? Debtor is not required to pay a charge in

excess of that allowed by the Code. §5-201(3).

Does statute restrict balloon payments or irregular pay-

ment schedules? Closed-end installment loans must be

payable in substantially equal installments except to

accommodate debtor’s seasonal or irregular income,

and with an exception allowing a nal balloon pay-

ment if term is at least four years and consumer has

right to renance on the terms then generally offered

by the creditor. §3-308. Closed-end supervised

installment loan of $1,000 or less must also be pay-

able at equal periodic intervals. §2-308.

Any restrictions on renancing? For most consumer

credit transactions, rate upon renancing is limited to

1% more per year than original rate. §2-504.

Any rebate requirements or restrictions on prepayment

penalties? Unless loan is secured by land, may prepay

in full or in part at any time without penalty, sub-

ject to minimum charges permitted by law. Lender

must provide actuarial rebate, but, upon prepayment

(but not renancing), lender may retain minimum

charge of $5 if amount nanced was $75 or less, $15

if amount nanced was more than $75 but less than

$250, and $25 if amount nanced was more than

$250. If rebate is less than $1, no rebate need be made.

§§2-509, 2-510.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Wage assign-

ment is prohibited and void, but consumer may revo-

cably authorize deductions from earnings. §3-305.

Security interest in land is prohibited and void for a

supervised loan that has an APR greater than 18%.

Security interest in consumer’s principal residence

is prohibited for supervised loan in which amount

nanced is $2,800 or less, unless lender already holds

rst mortgage. §2-307.

Does statute prohibit unconscionable loan charges? Yes.

§5-108.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Administrator may require licensed super-

vised lender to le annual and quarterly reports, and

additional reports if deemed necessary. Information

contained in reports may be published only in com-

posite form. §2-304.

Other signicant features: Loan-splitting prohibited.

§3-304.

MARYLAND

Md. Code Ann., Com. Law §§ 12-301 to 12-

317 (West) (Consumer Loan Law—Credit

Provisions); Md. Code. Ann., Fin. Inst. §§ 11-

201 to 11-223 (West) (Consumer Loan Law—

Licensing Provisions) (These two laws are cited

jointly as the Maryland Consumer Loan Law).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Applies to lenders if they make loans

under this law, except that the depositories that are

not required to be licensed are exempt. Com. Law

§12-302.

Licensure requirements and implications of licensure:

May not engage in the business of making loans

under this subtitle unless lender is licensed under

or exempt from licensing requirements. Com. Law

§12-302. See also Fin. Inst. §11-204(a). Banks, trust

companies, savings banks, credit unions, and savings

and loan associations are not eligible for licensure,

and their powers are unaffected by the licensure law.

Fin. Inst. §11-202.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Applies

to loans of $6,000 or less Com. Law §§12-303(a). See

also Com. Law §12-314. Maximum term may not

exceed: (1) 30 months and 15 days for loan of $700

or less; (2) 36 months and 15 days for loan of more

than $700 but less than $2,000; or (3) 72 months

and 15 days for loan of $2,000 or more. Com. Law

§12-306(e).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? First alternative:



For a loan of $2,000 and under, 33% on rst $500,

24% on amount over $500 but not more than $700,

and 15% on remainder.



For a loan between $2,000 and $3,500: 21%.



For a loan between $3,500 and $5,000, 18%.



For a loan over $5,000, 16.2%.

Second alternative (for loans that meet certain

conditions):



For loan of $2,000 or less, 33% on rst $1,000 and

24% on remainder.



For loan of more than $2,000, 24%.

Com. Law § 12-306(a)(2)-(6).

What loan fees are allowed? Recording fees, or premi-

ums for non-ling insurance if no more than those

fees. Com. Law §12-307(a).

What types of insurance are allowed, and any limits the

lending statute places on charges? Property insurance

on any real or personal property collateral; credit

health insurance covering any one or more borrow-

ers; credit life insurance on one borrower if loan is for

less than $700 and on more than one borrower if loan

is for $700 or more; and credit involuntary unem-

ployment benet insurance covering one borrower.

Com. Law §12-312.

Does statute prohibit all other fees besides those specically

allowed? Yes. Com. Law §12-313(a)(1). See also Com.

Law §12-314 (loan of $6,000 or less is unenforceable

if lender takes a rate of interest, charge, discount, or

other consideration greater than authorized, with

exception for clerical errors or mistakes that are cor-

rected before any payment is received).

Does statute restrict balloon payments or irregular pay-

ment schedules? A loan may be made at the split rates

(36% and 24%) authorized by Com. Law §12-306(6)

provided that the loan does not include a balloon

payment, unless payment in full is due on demand or

in 1 year or less. Com. Law §12-307(iv).

Any restrictions on renancing? Only 60 days of past-

due interest can be included in principal of re-

nanced loan. Com. Law §12-306(c).

Any rebate requirements or restrictions on prepayment

penalties? Borrower may prepay in full or in part at

any time without penalty. Com. Law §12-308(c). Stat-

ute prohibits lender from entering into precomputed

loan, and requires interest to be computed actuarially,

so effectively prohibits Rule of 78s rebates. Com. Law

§12-306(d)(1).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Security inter-

est in real property (other than judgment lien) for any

loan under $2,000, or in personal property for any

loan under $700, is prohibited and void. Com. Law

§12-311(c). Wage assignments prohibited. Com. Law

§12-311(b)(2).

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability

to repay? No, only for mortgage loans (Com. Law

§§12-311e).

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: The Commissioner shall report to the appro-

priate state’s attorney any alleged criminal violation

of Fin. Inst. §11-220.

Other signicant features: Wage assignment is treated

as a loan. Com. Law §12-303(b). Anti-evasion provi-

sions. Com. Law §12-303(c); Fin. Inst. §11-204(a)

(b)(2)(iii). Loan splitting prohibited. Com. Law

§12-313(a)(2).

Md. Code Ann., Com. Law §§ 12-1001 to 12-

1029 (West) (Credit Grantor Closed End Credit

Provisions).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Applies to any “credit grantor,” dened

to include, inter alia, any legal or commercial entity

making a loan or other extension of credit which is

incorporated, chartered, or licensed under state or

federal law, and subject to supervision, examina-

tion, and regulation, pursuant to state or federal law;

any money transmitter licensed in Maryland; or any

retailer. Denition includes any bank, trust company,

depository institution, or savings bank having a

branch in the state. Com. Law §12-1001(g).

Licensure requirements and implications of licensure:

Credit grantors are subject to the licensing, investiga-

tory, enforcement and penalty provisions of Fin. Inst.

§§11-301 to 11-304 unless exempt therefrom. Com.

Law §12-1015(a); Fin. Inst. §11-302(b). This licens-

ing provision does not apply to banks, savings and

loan associations, credit unions, licensees under the

Consumer Loan Law, sellers of goods or services that

do not make loans or act as a credit services business,

certain mortgage lenders that are licensed or exempt

from licensure requirements, and certain educational

loans. Fin. Inst. §11-301.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Provi-

sions regarding “consumer borrowers” apply to

consumer loans (ones for personal, family, or house-

hold purposes) regardless of amount. Com. Law

§12-1001(f).

Other restrictions on applicability of statute (e.g., it

only applies if lender takes a mortgage on real property):

Lender may take any security acceptable to it. Com.

Law §12-1002(b).

What rate of interest is allowed? 24%. Com. Law

§12-1003(a), (b). Note that the general usury stat-

ute, Com. Law §12-103, also allows an interest rate

of 24% on unsecured loans and loans secured by

personal property, so lenders may prefer to operate

under the general usury statute.

What loan fees are allowed? For consumer loans, lender

may charge reasonable fees for services rendered or

for reimbursement of expenses incurred in good faith

for: (1) attorney fees for preparation, closing, or dis-

bursement of the loan; (2) expenses, taxes, or charges

paid to governmental agencies; and (3) examination

of title, appraisal, or other costs necessary or appro-

priate to security of the loan. Fee must be an actual

and veriable expense and not retained by the lender.

Com. Law §12-1005(d). Loan fees, points, nder’s

fees, and other charges are prohibited unless loan is

secured by a lien on residential real property. Com.

Law §12-1005(a)(2).

What types of insurance are allowed, and any limits the

lending statute places on charges? Credit life insurance,

credit health insurance, credit involuntary unemploy-

ment benet insurance, and similar insurance cover-

ages is optional; purchase of property insurance, title

insurance, and credit loss insurance may be required

if the loan is secured. Com. Law §§12-1005(d)(1)(iii)

(4), 12-1007. Lender may charge for optional debt

cancellation agreement. Com. Law §12-1005(c).

Does statute prohibit all other fees besides those specically

allowed? Yes. Com. Law §12-1005(d)(1).

Does statute restrict balloon payments or irregular pay-

ment schedules? Installment loan to consumer may not

require balloon payment at maturity, with exceptions

for loan secured by lien on residential real property,

loan of $30,000 or more secured by passenger car,

or loan of $10,000 or more secured by a motorcycle.

Com. Law §12-1003(c).

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Consumer borrower may prepay in full at

any time without charge. Lender must give actuarial

rebate of precomputed interest charge, but need not

make rebate of less than $5. Com. Law §12-1009(a),

(b).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Wage assign-

ments prohibited and unenforceable, Com. Law

§12-1023(b)(2)(1), but otherwise credit grantor may

take any security as collateral as may be acceptable to

it. Com. Law §12-1002(b).

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? For mortgages only. Com. Law §12-1029.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: Not applicable.

MASSACHUSETTS

Mass. Gen. Laws ch. 140, § 90.

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applies generally to all loans.

Licensure requirements and implications of licensure: Stat-

ute is silent.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Less than

$1,000.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? Statute has effect of

capping interest at 18%: it provides that a loan of

less than $1,000 made at a rate of more than 6% is

discharged by payment of the principal plus interest

at the agreed rate or 18%, whichever is less. Ch. 140,

§90.

What loan fees are allowed? Not exceeding $5.00 “for

the actual expenses of making and securing the

loan.” Ch. 140, §90.

What types of insurance are allowed, and any limits the

lending statute places on charges? Statute is silent.

Does statute prohibit all other fees besides those specically

allowed? Effect of statute is to nullify any other fees.

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Actuarial method for calculating rebates:

Loan may be discharged by paying sum actually

borrowed plus interest at the agreed rate (or at 18%

if agreed rate exceeds 18%) for the time the loan is

actually outstanding, plus $5; but no rebate if loan is

repaid within rst 6 months. Ch. 140, §90.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Statute is

silent.

Does statute prohibit unconscionable loan charges? No,

but Mass. Code Regs. tit. 940, §3.16(1) provides that

an act or practice is violation of the state deceptive

practices statute, Mass. Gen. Laws Ch. 93A (which

applies to lending) if it is oppressive or unconscio-

nable in any respect.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Criminal usury state provides:

“The provisions of this section shall not apply to any

loan the rate of interest for which is regulated under

any other provision of general or special law or regu-

lations promulgated thereunder or to any lender sub-

ject to control, regulation or examination by any state

or federal regulatory agency.” Ch. 271, §49(e).

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: Not applicable.

Mass. Gen. Laws ch. 140, § 96 (Small Loan

Business); Mass. Gen. Laws ch. 140, §§ 98,

100, 103, 106–108, 110, 114, 114A; 209

Mass. Code Regs. § 26.01.

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applies generally to all lenders in business of

making loans of $6,000 or less at more than 12%. Ch.

140, §96.

Licensure requirements and implications of licensure:

Must have license to engage in business of making,

purchasing, or arranging loans of $6,000 or less,

where interest exceeds 12%. Ch. 140, §96. Loan made

by unlicensed lender is void. Ch. 140, §110. Loan

companies and loan associations established by spe-

cial charter, and fraternal mutual benet societies the

membership of which is limited to the employees of

any one person and which make loans to its members

only, shall be subject to the supervision of the com-

missioner, but need not procure a license. Ch. 140,

§114. Trust companies, savings banks, co-operative

banks, savings and loan associations, credit unions,

national banking associations, federal savings banks,

federal savings and loan associations, or any subsid-

iary of the foregoing shall not be subject to licensing

and other small loan provisions, but must abide by

statute’s limits on interest, expenses and other con-

sideration. Ch. 140, §114A.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: $6,000 or

less. Ch. 140, §96.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute applies only to loans made primarily for per-

sonal, family, or household purposes. Statute, except

for interest rate limit, does not apply to certain loans

by secondary educational institutions. Statute does

not apply to home mortgage loans and open-end

mortgage loans. Ch. 140, §96.

What rate of interest is allowed? 23%. Ch. 140, §100;

209 Mass. Code Regs. §26.01(1)(a). All sums charged

against or paid by the borrower for making or secur-

ing the loan, including, inter alia, interest, brokerage,

recording fees, and commissions, must fall within

this cap. Ch. 140, §96.

What loan fees are allowed? An administrative fee of

$20 upon the granting of a loan. This fee may not

be assessed more than once during any 12 month

period. 209 Mass. Code Regs. §26.01(1)(a). Recording

fees. Ch. 140, §100.

What types of insurance are allowed, and any limits the

lending statute places on charges? Statute is silent.

Does statute prohibit all other fees besides those specically

allowed? Yes. Ch. 140, §§100, 106.

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute and but regulations provide

that interest may be precomputed only when con-

tract requires repayment in substantially equal and

consecutive monthly installments of principal and

interest charges. Ch. 140, §100; 209 Mass. Code Regs.

§26.01(4).

Any restrictions on renancing? Lender can charge $20

administrative fee only once in any 12-month period,

and must notify borrower of option to take out a

new loan rather than renancing an existing loan at a

higher rate. 209 Mass. Code Regs. §26.01(1).

Any rebate requirements or restrictions on prepayment

penalties? Authorities are contradictory. Statute

requires actuarial method, Ch. 140, §100, yet 209

Mass. Code Regs. §26.01(4)(b) authorizes Rule of 78s

(sum of payments):

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Personal prop-

erty and assignment of wages specically allowed.

Ch. 140, §107.

Does statute prohibit unconscionable loan charges? No,

but Mass. Code Regs. tit. 940, §3.16(1) provides that

an act or practice is violation of the state deceptive

practices statute, Mass. Gen. Laws Ch. 93A (which

applies to lending) if it is oppressive or unconscio-

nable in any respect.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Criminal usury statute pro-

vides: “The provisions of this section shall not apply

to any loan the rate of interest for which is regulated

under any other provision of general or special law

or regulations promulgated thereunder or to any

lender subject to control, regulation or examination

by any state or federal regulatory agency.” Ch. 271,

§49(e).

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report containing information as com-

missioner may require. Ch. 140, §98.

Other signicant features: Loan splitting prohibited.

Ch. 140, §100.

MICHIGAN

Mich. Comp. Laws §§ 493.1 to 493.24

(Regulatory Loan Act).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applies generally to lenders, but exempts

banks, savings banks, industrial banks, trust compa-

nies, building and loan associations, credit unions,

and licensed pawnbrokering. §§493.2, 493.20.

Licensure requirements and implications of licensure:

Must have license to make loans at rate higher than

non-licensee can charge. §493.2(1).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute is

silent.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? 25%. §§493.13,

445.1854.

What loan fees are allowed?



Loan processing fee not to exceed 5% of the princi-

pal, up to $250 (adjusted for ination), which may

be added to principal. The current maximum fee

is $300. See www.michigan.gov/documents/difs/

Bulletin_2014-01-CF_445955_7.pdf?20150318124433.



Recording fees.

§ 493.13(4).

What types of insurance are allowed, and any limits the

lending statute places on charges? Licensee may provide

credit insurance, and any other insurance under the

insurance code. §493.13a.

Does statute prohibit all other fees besides those specically

allowed? Yes. §493.13(4).

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Borrower may prepay in any amount at any

time. §493.14(c). Prepayment penalties are prohibited

because not authorized by §493.13(4). Loan contract

cannot have precomputed interest, so there will be no

need for a rebate. §493.13(3).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Forbids liens

on real estate other than judgment liens. §493.12(2).

Wage assignments are invalid. §493.17.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Statute is silent, but criminal

usury law, §438.41, criminalizes charging more than

25% only when lender is not authorized by law to

do so.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual nancial statement, including infor-

mation on earnings, and annual report on volume

and type of business activities. Commissioner shall

publish an annual analysis and recapitulation.

§493.11.

Other signicant features: Loan-splitting prohibited.

§493.13(4). Anti-evasion provision. §493.18(1), (2).

Mich. Comp. Laws §§ 445.1851 to 445.1864

(Credit Reform Act).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Act applies to extensions of credit made

by regulated lenders. “Regulated lender” means a

depository institution, a licensee under the consumer

nancial services act, the secondary mortgage loan

act, the motor vehicle sales nance act, or the regula-

tory loan act (summarized above), or a seller under

the home improvement nance act. §445.1852(i).

(Any entity, whether licensed or not, may loan

money at the legal interest rate set by §438.31.)

Licensure requirements and implications of licensure:

“Regulated lenders” other than depository institu-

tions and sellers under home improvement nance

act must be licensed under the consumer nancial

services act, the secondary mortgage loan act, the

motor vehicle sales nance act, or the regulatory loan

act (summarized above), or a seller under the home

improvement nance act. §445.1852(i).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute is

silent.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? 25%. §445.1854.

What loan fees are allowed? Except for depository insti-

tutions and as otherwise provided by law, a regulated

lender may require the borrower to pay a processing

fee of 2% of amount of credit extended. §445.1856(1)

(a). A depository institution may charge all fees and

charges that are agreed to or accepted by the bor-

rower. §445.1857. (A licensee under the Regulatory

Loan Act may charge a processing fee of 5%, up to

the maximum amount of $300, but cannot charge an

additional 2% processing fee over and above the 5%

processing fee.)

What types of insurance are allowed, and any limits the

lending statute places on charges? Statute is silent.

Does statute prohibit all other fees besides those specically

allowed? Yes. §§445.1852(f), 445.1856(4), 445.1857(3).

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? An agreement by a borrower or buyer to

pay a penalty is void and unenforceable, but pre-

payment charges are not penalties. §445.1858(c).

Actuarial rebate of precomputed interest is required.

§445.1855.

What security interests (or postdated checks or ACH autho-

rizations) are allowed or prohibited? Statute is silent.

Does statute prohibit unconscionable loan charges? No.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Statute is silent, but criminal

usury law, §438.41, criminalizes charging more than

25% only when lender is not authorized by law to

do so.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: Not applicable.

MINNESOTA

Minn. Stat. § 47.59 (Financial institution credit

extension maximum rates).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Law applies to any “nancial institution,”

dened as a bank, a bank and trust, a trust company

with banking powers, a saving bank, a savings asso-

ciation, an industrial loan and thrift company orga-

nized under chapter 53, a regulated lender organized

under chapter 56 (see next summary), or an operating

subsidiary of any such institution. §47.59 subdiv. 1(k).

Licensure requirements and implications of licensure: Stat-

ute is silent, but the lenders to which it applies are

required by other law to be licensed or chartered or

the equivalent.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute

is silent. Size of loans is determined by law under

which the lender is licensed or chartered.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed?



21.75% on unpaid balance; or



33% on rst $1,125 (adjusted for ination) and 19%

on remainder.

§ 47.59 subdiv. 3(a).

What loan fees are allowed?



Ofcial fees and taxes.



Charges for other benets conferred on the bor-

rower that are of a type that is not for credit. §47.59

subdiv. 6(a)(6).



Onetime $25 loan administrative fee if principal

is $6,480 or less (adjusted for ination). §47.59

subdiv. 6(d).

What types of insurance are allowed, and any limits the

lending statute places on charges? Property insurance;

liability insurance; credit insurance providing life,

accident, health, or unemployment coverage; and

vendor’s single interest insurance. §47.59 subdiv.

6(b).

Does statute prohibit all other fees besides those specically

allowed? Borrower is not required to pay any charge

in excess of those allowed by the statute. §47.59

subdiv. 14.

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent.

Any restrictions on renancing? No.

Any rebate requirements or restrictions on prepayment

penalties? Borrower may prepay in full at any time

without penalty. §47.59 subdiv. 9. Actuarial rebate

required, but no refund required if less than $7.50.

§47.59 subdiv. 3(f), (h).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Wage assign-

ment is unenforceable unless it is a revocable pay-

roll deduction or preauthorized payment plan or

applies only to wages already earned at the time

of the assignment. §47.59 subdiv. 12(c). Other than

this, statute is silent about what security interests are

authorized or prohibited, but it refers to charges for

perfecting security interests.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what

must be reported and whether there are any requirements

that the state agency review or take other steps regarding

the reports: Statute is silent, but an annual report is

required by chapters 53 and 56 and §47.60.

Other signicant features: Not applicable.

Minn. Stat. § 47.601 (Consumer

Short-Term Loans)

What types of lenders does it apply to (e.g., banks vs.

non-banks)? “Consumer short-term lender” means

an individual or entity, other than a state or feder-

ally chartered bank, savings bank, or credit union,

engaged in the business of making or arranging con-

sumer short-term loans. §47.601 subdivs. 1(d), 1(e).

Licensure requirements and implications of licensure: A

loan is void, and the borrower is not obligated to

pay any amounts owing if the loan is made by a con-

sumer short-term lender who has not obtained an

applicable license from the commissioner. §47.601

subdiv. 6(b).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Applies

to “consumer short-term loan,” dened as a loan

which has a principal amount, or an advance on a

credit limit, of $1,000 or less and requires a minimum

payment within 60 days of loan origination of more

than 25% of the principal balance. Excludes pawn

transactions and other transactions where lender’s

sole recourse for recovery after default, other than

a lawsuit for damages for the debt, is to proceed

against physical goods pledged as collateral. §47.601

subdiv. 1(d).

Other restrictions on applicability of statute (e.g., it

only applies if lender takes a mortgage on real property):

§47.601 operates as a reporting statute for loans of

$1,000 or less; lenders operate under other statutes

when making these loans.

What rate of interest is allowed? No contract or agree-

ment between a consumer short-term loan lender

and a borrower residing in Minnesota may contain

a provision “in which interest rates, fees, charges, or

loan amounts exceed those allowable under §47.59,

subdiv. 6, or §47.60, subdiv. 2, other than by de mini-

mis amounts if no pattern or practice exists.” §47.59

subdiv. 6 allows:



Ofcial fees and taxes.



Charges for other benets conferred on the bor-

rower that are of a type that is not for credit. §47.59

subdiv. 6(a).



Onetime $25 loan administrative fee if principal

is $6,480 or less (adjusted for ination). §47.59

subdiv. 6(d).



“[T]he nance charges permitted by this section,”

which would include those set forth in subdiv.

3: either 21.75% on unpaid balance or 33% on

rst $1,125 (adjusted for ination) and 19% on

remainder.

§ 47.60, subdiv. 2 allows:



7% of loan amount, with a minimum of $10, plus a $5

administrative fee, if loan is greater than $100 but no

more than $250.



6% of loan amount, with a minimum of $17.50, plus

a $5.00 administrative fee, if loan is more than $200.



Lesser amounts for loans of $100 or less.

What loan fees are allowed? See preceding entry.

What types of insurance are allowed, and any limits the

lending statute places on charges: Statute is silent.

Does statute prohibit all other fees besides those speci-

cally allowed? Fees allowed by §47.60, subdiv. 2, are

“in lieu of the interest, nance charges, or fees in

any other law.” §47.60, subdiv. 2(a). Loan is void,

and statute gives borrower the right to sue if lender

charges more than the rates, fees, or charges allowed.

§47.601, subdivs. 2(a)(3)(ii), 6(b)(3).

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Statute is silent.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Statute refers

to holding of a check evidencing the borrower’s obli-

gation on a short-term loan, §47.601 subdiv. 2(a), but

otherwise is silent.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report containing total dollar amount,

over and above principal, collected on consumer

short-term loans; the average APR and range of

APRs; the number of individual borrowers, broken

down by the number who obtained: (i) 5 or more

loans; (ii) 10 or more loans; (iii) 15 or more loans; and

(iv) 20 or more loans; and the total number and dollar

amount of loans charged off or written off. §47.601

subdiv. 4.

Other signicant features: No forum or choice of law

other than Minn. No class action ban for certain vio-

lations. §47.601 subdiv. 2.

Minn. Stat. §§ 56.0001 to 56.26 (Regulated

Loan Act).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Lenders making loans under this statute

are referred to as “regulated lenders.” The statute

excludes banks, savings associations, trust com-

panies, licensed pawnbrokers, and credit unions.

§56.002.

Licensure requirements and implications of licensure:

Must have license in order to make loans with the

charges allowed by this statute, but industrial loan

and thrift companies need not be licensed, and cer-

tain federally-related entities may purchase mortgage

loans from licensees without being licensed. §§56.01,

56.002. Loan made without required license is unen-

forceable. §56.18.

Size and length of loans to which the statute applies,

and any restrictions in the statute on these features: Not

exceeding $100,000 or 15% of a Minnesota corporate

licensee’s stock and surplus. §56.131, subdiv. 1(a).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? On loan up to $100,000,

lender may charge either: (1) 21.75% or (2) 33% on

rst $1,125 (adjusted for ination) and 19% on the

remainder. §56.131, subdiv. 1(a) (incorporating

§47.59).

What loan fees are allowed?



Recording fees and taxes, or the cost of non-ling

insurance if no greater than this amount.



Onetime $25 loan administrative fee if principal is

$6,480 or less (adjusted for ination).

§ 56.131 subdiv. 2(e).

What types of insurance are allowed, and any limits the

lending statute places on charges? Life, accident, health,

and involuntary unemployment insurance; property

insurance on collateral. §56.155.

Does statute prohibit all other fees besides those specically

allowed? Yes. §§56.131 subdiv. 2, 56.15.

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent.

Any restrictions on renancing? Statute is silent except

for loans secured by real estate. §56.131 subdiv. 2.

Any rebate requirements or restrictions on prepayment

penalties? Borrower may prepay in any amount at any

time. §56.14(3). Actuarial rebate required. §56.131

subdiv. 6 (incorporating §47.59, subdiv. 3(f), (h)).

Special rules for rebates involving discount points

on real-estate-secured loans of $18,000 or more.

§§56.131, subdiv. 6, 47.59, subdiv. 3(e).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Limits wage

assignments to 10% of wages but does not prohibit

them. §56.17. Prohibits lien on real estate for loan of

$6,840 or less. §56.12.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report containing the information

required by the commissioner, who shall publish an

annual analysis and recapitulation. §56.11.

Other signicant features: Loan-splitting prohibited.

§56.131 subdiv. 3. Anti-subterfuge (anti-deception)

provision. §56.18. If lender takes a wage assignment,

the transaction is governed by this chapter. §§56.16,

56.17.

MISSISSIPPI

Miss. Code Ann. §§ 75-17-21 and 75-67-101

to 75-67-139 (Small Loan Regulatory Law).

What types of lenders does it apply to (e.g., banks vs. non-

banks)?

Everyone except:



Banks, savings banks, trust companies, building

and loan associations, insurance companies, pawn-

brokers, and credit unions.



Loans made to the lender’s employees or farm

tenants.



Lenders making loans secured only by real estate.



Loans for farming or agricultural operations.



Loans insured or guaranteed by the U.S.



Dealers and sellers or purchasers of conditional

sales or retained title contracts on real or personal

property.



Occasional lenders not regularly engaged in the

business of lending money.

§§ 75-67-135, 75-67-241.

Licensure requirements and implications of licensure: No

person shall engage in the business of lending money

except as authorized by this article (§§75-67-101 to

75-67-139), and without being the holder of a valid

and subsisting license to engage in such business

as provided by the Small Loan Privilege Tax Law

(§§75-67-201 to 75-67-247). §75-67-105(1).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute is

silent.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed?



36% on rst $1,000.



33% on amount over $1,000 but not exceeding

$2,500.



24% on amount over $2,500 but not exceeding

$5,000.



14% on remainder.

The 36% rate is to be increased by the number of per-

centage points by which the discount rate exceeds

8%, and the other rates by the number of percent-

age points by which the discount rate exceeds 10%.

§75-17-21(1), (4). In the alternative, on loans of

$25,000 or more: 18%. §75-17-21(2).

Origination and other fees are allowed: Closing fee of

$25 or 4% of total payments due on loan, whichever

is greater, if loan is for $10,000 or less; otherwise,

$500. §75-17-21(3). If loan is for $100 or more, record-

ing fees and a reasonable fee paid to an attorney

for investigating title to property given as security.

§75-67-121.

What types of insurance are allowed, and any limits the

lending statute places on charges? On loan of $100 or

more, lender may charge for property insurance on

collateral and life, health and/or accident insurance

on any borrower. May sell auto club membership

after loan has been approved. §75-67-121.

Does statute prohibit all other fees besides those speci-

cally allowed? Yes. §75-17-119 (all nance charges are

forfeited if lender charges any charge in excess of that

expressly permitted).

Does statute restrict balloon payments or irregular pay-

ment schedules? “Licensee” is dened as an entity that

holds a license and that engages in the business of

lending money to be paid back in monthly install-

ments or other regular installments for periods of

more or less than 1 month. §75-67-103(b).

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? When loan is prepaid in full, lender must

make Rule of 78s rebate, but need not make refund of

less than $1. Calculation is to be based on the number

of days by which the loan is paid in advance, less 20

days. §75-67-127(1)(c).

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Allows

security interests in real or personal property.

§75-67-127(1)(a). See also §75-67-103(b) (denition of

“licensee” applies whether or not the lender requires

security from the borrower as indemnity for the

repayment of the loan).

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: Not applicable.

Miss. Code Ann. §§ 75-67-39, 75-67-41

(Installment Loans).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? “Any persons, natural or articial, including

domestic and foreign corporations, lending money in

this state.” §75-67-39.

Licensure requirements and implications of licensure: Stat-

ute is silent.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute is

silent.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? 7%. §75-67-39. But 10%

if the borrower prepays, defaults, or breaches any

covenant entitling the lender to declare the whole

indebtedness due and payable and to a foreclosure of

the security. §75-67-41

What loan fees are allowed? Statute is silent.

What types of insurance are allowed, and any limits the

lending statute places on charges? Statute is silent.

Does statute prohibit all other fees besides those specically

allowed? Statute is silent.

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute requires monthly or weekly

installments, §75-67-39, but otherwise is silent.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? If consumer prepays, can be required to pay

interest at 10% for period that loan was actually out-

standing. §75-67-41.

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Lender

may take security interest in real or personal prop-

erty. §75-67-39.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Statute is silent.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: These two statutory provi-

sions remain on the books but are rarely or never

used in Mississippi. They are the remaining vestiges

of previous loan statutes that were superseded in

the 1950s by the adoption of the Small Loan Regula-

tory Law.

MISSOURI

Mo. Rev. Stat. §§ 408.100 to 408.213 (Interest

on Small Loans).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applicable broadly to loans made by any

person, rm, or corporation that are not made under

other Missouri laws. §§408.100, 408.190.

Licensure requirements and implications of licensure: Stat-

ute is silent. This is not a licensing statute.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute is

silent.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute excludes loans which are secured by a lien on

real estate, nonprocessed farm products, livestock,

farm machinery or crops, and loans to corporations.

§408.100.

What rate of interest is allowed? Any rate agreed to by

parties. §408.100.

What loan fees are allowed?



On closed-end loans for 30 days or longer, fee

of 10% of principal, not to exceed $75.00.

§408.140(1)(1).



Recording fees, or premium for non-ling insur-

ance if no more than this amount. §408.140(1)(2).

What types of insurance are allowed, and any limits the

lending statute places on charges? Non-ling insurance,

property and liability insurance, life, health, accident,

and involuntary unemployment insurance; GAP

insurance if loan has collateral. §408.140(1).

Does statute prohibit all other fees besides those specically

allowed? Yes. §§408.140(1), 408.150.

Does statute restrict balloon payments or irregular pay-

ment schedules? If loan contract provides for payment

in consecutive monthly installments, no installment

shall be substantially greater than any other install-

ment. §408.120.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepay-

ment penalties? Prepayment penalties likely not

allowed because not listed in §§367.100 to 367.200

or §408.140(1). For precomputed note, Rule of 78s

rebate (sum of the balances method) is allowed if

initial loan term is 61 months or less and loan is for

$5,000 or less; actuarial rebate required for loan of

more than $5,000. §408.170.

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Prohibits

non-purchase-money security interests in household

furnishings, appliances, or clothing of the borrower

or dependents for consumer loan of less than $500, or

in any goods if loan is less than $150. §408.551 (pro-

viding that loans made under §408.100 are subject to

§408.558). Wage assignment is void. §408.551 (pro-

viding that loans made under §408.100 are subject to

§408.560). Law inapplicable to loans secured by real

estate or certain farm assets. §408.100.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Statute is silent, but criminal usury stat-

ute, §408.095, criminalizes charging interest greater

than 24% only when not permitted by other Missouri

laws.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: Prohibition against loan-

splitting. §408.200. Wage assignment is treated as

loan. §408.210.

Mo. Rev. Stat. § 408.510 (Consumer

Installment Loans).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applies to all persons licensed to make con-

sumer installment loans. §408.510.

Licensure requirements and implications of licensure:

Consumer installment lenders must register under

§367.110. §408.510.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: “Con-

sumer installment loans” means secured or unse-

cured loans of any amount and payable in at least

four substantially equal installments over a period of

at least 120 days. §408.510.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? Any rate agreed to by

parties. §408.510 (incorporating §408.100).

What loan fees are allowed?



A fee of 10% of principal, not to exceed $75.00.



Recording fees, or premium for non-ling insur-

ance if no more than this amount.

§ 408.510 (incorporating § 408.140(1)).

What types of insurance are allowed, and any limits the

lending statute places on charges? Property and liabil-

ity insurance, life, health, accident, and involuntary

unemployment insurance; GAP insurance if loan has

collateral. §408.510 (incorporating §408.140(1)).

Does statute prohibit all other fees besides those specically

allowed? Yes, §408.510 by reference to §408.140.

Does statute restrict balloon payments or require substan-

tially equal installments? Loan must be payable in at

least four substantially equal installments. §408.510.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Prepayment penalty is likely prohibited

because not listed in §408.140. For precomputed

note, Rule of 78s rebate (sum of the balances method)

is allowed if initial loan term is 61 months or less and

loan is for $5,000 or less; actuarial rebate required for

loan of more than $5,000. §408.510 (incorporating

§408.170).

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Prohibits

non-purchase-money security interests in household

furnishings, appliances, or clothing of the borrower

or dependents for consumer loan of less than $500,

or in any goods if loan is less than $150. §408.510

(incorporating §408.558). Wage assignment is void.

§408.510 (incorporating §408.560).

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability

to repay? When making or negotiating loans, lender

must take into consideration in determining the size

and duration of a loan contract the nancial abil-

ity of borrowers to reasonably repay the loan in the

time and manner as specied in the loan contract.

§367.185(4), made applicable to installment lenders

by §§408.510, 408.512.

Is lending under this statute exempt from state criminal

usury law? Statute is silent, but criminal usury statute,

§408.095, criminalizes charging interest greater than

24% only when not permitted by other Missouri laws.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: Not applicable.

MONTANA

Mont. Code Ann. §§ 32-5-101 to 32-5-409

(Consumer Loan Act).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Does not apply to regulated lender (as

dened in §31-1-111) to which the exemption from

interest rate limits in §31-1-112 applies [namely, the

following are not covered by Consumer Loan Act:

a bank, building and loan association, savings and

loan association, trust company, credit union, credit

association, residential mortgage lender licensee,

development corporation, bank holding company, or

mutual or stock insurance company; a subsidiary of

an entity already described; a state or federal agency

authorized to lend money; a corporation or other

entity established by Congress or the state that is

owned, in whole or in part, by the U.S. or the state

that is authorized to lend money. Does not apply to

a person who makes fewer than 4 consumer loans a

year with the person’s own funds, does not represent

that the person is a licensee, and complies with the

provisions of §31-1-1. §32-5-103(5).

Licensure requirements and implications of licensure:

Unless lender is exempt, license is required to engage

in business of making consumer loans in any amount

for compensation. §32-5-103(1).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute

is silent.

Other restrictions on applicability of statute (e.g., it

only applies if lender takes a mortgage on real property):

“Consumer loan” must be for personal, family, or

household use, and is dened to exclude residential

mortgage loans and payday loans. §32-5-102(2)(b).

What rate of interest is allowed? 36%. §32-5-301(1).

What loan fees are allowed?



Recording fees, or premium for non-ling insur-

ance if no greater than those fees.



Fees for title examination, title insurance, or similar

purposes, including survey.



Fees for preparation of documents.



Notary fees.



Appraisal fees.



Credit report fees.

§ 32-5-301(2).

What types of insurance are allowed, and any limits the

lending statute places on charges? Property insurance

on collateral, credit life insurance, credit disability

insurance, and loss of income insurance, but only if

loan principal exceeds $300. §32-5-306.

Does statute prohibit all other fees besides those specically

allowed? Yes. §32-5-301(5)(a).

Does statute restrict balloon payments or irregular pay-

ment schedules? Single-payment loans are permissible

as long as the payment is due at least 45 days but no

more than one year from date loan is made. If loan

contract provides for installment payments, then: (1)

the payments must be due at approximately equal

periodic intervals, except to accommodate borrow-

ers with seasonal incomes; and (2) no payment can

be substantially larger than any previous payment

except that balloon payment loans are permissible

as long as they do not negatively amortize. If loan

contract provides for monthly installment payments,

rst installment must be due no more than 45 days

after loan was made. §32-5-302.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? May prepay in whole or in part without

penalty at any time. §32-5-303(1)(i). Section 32-5-311

prohibits precomputed interest, so implicitly forbids

use of Rule of 78s.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Regulates but

does not prohibit wage assignments. §32-5-310.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report containing information pre-

scribed by department. §32-5-308.

Other signicant features: Anti-evasion provision.

§32-5-103(3). Loan splitting prohibited. §32-5-301(5)

(a). Limits any wage assignment to 10% of wages.

§32-5-310.

NEBRASKA

Neb. Rev. Stat. §§ 45-1001 to 45-1069

(Installment Loan Act).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Any person, other than a nancial institution

(dened by §§8-101 and 45-1002(g) as a bank, sav-

ings bank, building and loan association, savings and

loan association, credit union, or similar organiza-

tion covered by federal deposit insurance, or a trust

company) is eligible for a license and to be allowed

to make loans under the Installment Loan Act.

§45-1003.

Licensure requirements and implications of licensure:

Act does not apply to loans made by nonlicensees if

the interest rate does not exceed 16%. §§45-1002(3),

(4), 45-101.03. License required to charge the interest

rates and other charges allowed by the Installment

Loan Act. 45-1004(1).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features:



Statute is inapplicable to loans for more than

$25,000 that are not secured by real property.

§45-1025(2).



Except for loans secured by manufactured homes,

the maximum loan term for loans greater than

$3,000 and less than $25,000 is 145 months.

§45-1024(1).



If principal is no more than $3,000, term must not

exceed 36 months. §45-1025(3).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? 24% on rst $1,000,

and 21% on remainder §45-1024(1). In the alter-

native, licensee may charge general usury rate

(16%). §45-1025(1) (incorporating §§45-101.03 and

45-101.04).

What loan fees are allowed? Nonrefundable loan origi-

nation fee, including reasonable expenses for making,

closing, disbursing, extending, readjusting, or renew-

ing of loans, including abstracting, recording, releas-

ing, and registration fees; title examinations; credit

reports; survey; and fees and expenses charged for

electronic title and lien services, but not to exceed

the lesser of $500 or 7% of rst $2,000 and 5% of

remainder, but must fall within 24% interest cap.

§45-1024(5).

What types of insurance are allowed, and any limits the

lending statute places on charges? Property and liability

insurance on motor vehicle; re and extended-cover-

age insurance on real property or tangible personal

property; involuntary unemployment or job protec-

tion insurance; life, health, and accident insurance;

any other type of insurance or motor club service;

nonling insurance; charges for debt cancellation

contracts or debt suspension contracts; amounts

charged for a guaranteed asset protection waiver.

§§45-1024(5), 45-1026.

Does statute prohibit all other fees besides those specically

allowed? Yes. §45-1024(4).

Does statute restrict balloon payments or irregular pay-

ment schedules? Precomputed loan contracts must

provide for substantially equal installments pay-

able at approximately equal periodic intervals, with

minor variation allowed for rst payment period.

§45-1025(3).

Any restrictions on renancing? If licensee has made

another loan to borrower within the previous 12

months, the nonrefundable loan origination fee may

be charged only on new funds advanced on each suc-

cessive loan. §45-1024(5).

Any rebate requirements or restrictions on prepayment

penalties? Borrower may prepay one or more full

installments at any time. §45-1022. For prepayment

in full, borrower is entitled to actuarial rebate, but no

rebate of less than $1 need be made. §45-1024(2)(c).

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Statute

imposes requirements on wage assignments but does

not prohibit them. §§45-1028, 45-1030.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report of the licensee’s earnings, oper-

ations, assets, and other relevant information as the

department may reasonably require. §45-1018.

Other signicant features: Anti-evasion provisions.

§§45-1015, 45-1021.

NEVADA

Nev. Rev. Stat. §§ 675.010 to 675.490

(Installment Loan and Finance Act).

What types of lenders does it apply to (e.g., banks vs. non-

banks)?

Applies to any person who makes installment

loans that are not governed by state payday loan law. Does

not apply to:



Banks, national banking associations, savings

banks, trust companies, savings and loan associa-

tions, credit unions, mortgage brokers, mortgage

bankers, thrift companies, pawnbrokers, insurance

companies, or real estate investment trusts.



Loans from employee benet plans.



Firms or corporations principally engaged in mort-

gage lending with approval by Fannie Mae, HUD

and the Department of Veterans Affairs.



Person holding a nonrestricted state gaming

license.



Licensed payday lenders.

§ 675.040. Commissioner may grant additional

exemptions. §675.055.

Licensure requirements and implications of licensure:

Must have license to engage in business of lend-

ing, except for deferred deposit loan services, high-

interest loan services (those charging APR of more

than 40%), or title loan services, which must obtain

appropriate license under §§604A.010–604A.150).

§675.060.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute is

silent.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? Statute does not specify

an interest rate, but §604A.400 prohibits any lender,

including one licensed under this Act, from operat-

ing a “high-interest loan service” without obtaining

a license under chapter 604A. §604A.0703 denes a

“high-interest loan” as one, other than a payday loan,

a vehicle title loan, or a refund anticipation loan, that

charges interest at more than 40%. Reading these stat-

utes together with this Act, a licensee under this Act

cannot charge more than 40% interest without obtain-

ing a license under chapter 604A. Since chapter 604A

allows licensees to make high-interest loans only if

the term is limited to 150 days, §604A.408(2), longer-

term installment loans at rates exceeding 40% cannot

be made regardless of licensure.

What loan fees are allowed? Any fees imposed on the

licensee pursuant to this Act. 675.300.

What types of insurance are allowed, and any limits the

lending statute places on charges? Life, health or dis-

ability, and involuntary unemployment insurance;

property insurance on collateral; insurance protecting

lender’s interest in the collateral; single interest non-

ling insurance; and any other credit-related insur-

ance approved by the commissioner. §675.300.

Does statute prohibit all other fees besides those specically

allowed? Statute is silent.

Does statute restrict balloon payments or irregular

payment schedules? The high-interest loan statute,

§§604A.408(2)(a) and 604A.480(2)(a)(3) requires

certain high-cost loans with terms of up to 150 days

to be payable in installments, but there is no similar

requirement for the longer-term loans governed by

chapter 675.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Lender must allow prepayment. §675.360.

Statute is silent about rebates.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Wage assign-

ments are invalid. §675.340. Prohibits security inter-

est on real property, other than judgment lien, except

real property upon which is situated a manufactured

home or factory-built housing that also secures the

loan. §675.350.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent. But cf. §604A.450 (requiring

borrower to sign afdavit that vehicle title loan is

affordable).

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report containing information pre-

scribed by commissioner. §675.260.

Other signicant features: Anti-evasion provisions.

§§675.035, 675.070 675.300.

NEW HAMPSHIRE

N.H. Rev. Stat. Ann. §§ 399-A:1 to 399-A:19

(Small Loans).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Any person engaged in the business of

making small loans, including closed-end loans,

open-end loans, title loans, and payday loans. §399-

A:1(XV) (moved to §§399-A:1(XX) and 399-A:2 as of

Jan. 1, 2016).. Chapter does not apply to banks, trust

companies, insurance companies, savings or building

and loan associations, credit unions, or lenders that

exclusively make educational loans. §399-A:2(III).

Licensure requirements and implications of licensure:

License required to engage in business of making

small loans, i.e., those with nance charges greater

that 10% (other than recording fees and costs of

repossession or sale of collateral). §§399-A:1(XIV)

(moved to §399-A:1(XX) as of Jan. 1, 2016), 399-

A:2(I). Unlicensed lender is barred from recovering

any nance charge, delinquency charge, or collection

charge. §399-A:18(II).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute

applies to loan of $10,000 or less. §399-A:1(XIV)

(moved to §399-A:1(XX) as of Jan. 1, 2016).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? 36% APR, calculated

under federal Truth in Lending Act rules, but exclud-

ing one application fee per borrower per year and

one participation or membership fee per borrower

per year. §399-A:12(I), (II) (moved to §399-A:16(I) as

of Jan. 1, 2016).

What loan fees are allowed? Statute allows recording

fees, but prohibits any other charges for examina-

tion, service, brokerage, commission, or other fee,

except repossession costs. §399-A:11(XI) (moved to

§399-A:15(XI) as of Jan. 1, 2016).

What types of insurance are allowed, and any limits the

lending statute places on charges? Credit life, acci-

dent and health, and involuntary unemployment

insurance, and property insurance on collateral.

§399-A:11(XII), (XIII) (moved to §399-A:15(XII),

(XIII) as of Jan. 1, 2016).

Does statute prohibit all other fees besides those specically

allowed? Yes. §399-A:11(XI) (moved to §399-A:15(XI)

as of Jan. 1, 2016).

Does statute restrict balloon payments or require substan-

tially equal installments? Statute is silent.

Any restrictions on renancing? Only restriction (other

than §399-A:13(VII) (moved to §399-A:17(VII) as of

Jan. 1, 2016), which applies only to payday loans),

is that renanced loan can include only 60 days

of unpaid interest from prior loan. §399-A:11(IV)

(moved to §399-A:15(IV) as of Jan. 1, 2016).

Any rebate requirements or restrictions on prepay-

ment penalties? Lender must permit prepayment.

§399-A:12(VI)(d) (moved to §399-A:15(XVI)(d)

as of Jan. 1, 2016). Prepayment penalties are likely

prohibited because not listed in §399-A:11(XI)

(moved to §399-A:15(XI) as of Jan. 1, 2016). Statute

is silent about rebates, but §399-A:11(IV) (moved

to §399-A:15(IV) as of Jan. 1, 2016) requires interest

to be computed only on unpaid principal balances,

which implies that any rebate must be actuarial.

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Any

security agreed upon, §399-A:12(II) (moved to

§399-A:16(II) as of Jan. 1, 2016), except that security

interest on real estate, or on household furniture

presently in use if loan is for $2,000 or less, is prohib-

ited and void. §399-A:11(VIII), (IX) (moved to §399-

A:15 (IX), (X)) as of Jan. 1, 2016).

Does statute prohibit unconscionable loan charges? No,

but statute gives the commissioner exclusive author-

ity and jurisdiction to investigate charges, including

interest and fees, that are or may be unreasonable or

an unfair or deceptive act or practice under the state

deceptive practices statute. §399-A:12(VII) (repealed

as of Jan. 1, 2016).

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report; nancial statement includ-

ing balance sheet, income statement, statement of

changes in owners’ equity, cash ow statement,

and note disclosures. Commissioner shall publish

annual analysis of this information. §399-A:(6)(I), (II)

(moved to §399-A:10(I), (II) as of Jan. 1, 2016).

Other signicant features: Prohibits lender from allow-

ing any borrower to be obligated to it on one or more

contracts if combined principal balance exceeds

$10,000. §399-A:12(III). Requires lender to allow

borrower to cancel up to close of next business day.

§399-A:12(XVIII) (moved to §399-A:15(XVIII) as of

Jan. 1, 2016).

NEW JERSEY

N.J. Stat. Ann. §§ 17:11C-1 to 17:11C-49

(West) (New Jersey Consumer Finance

Licensing Act).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applies to anyone making covered loans, but

depository institutions, trust companies, insurance

companies, and pawnbrokers are exempt. §17:11C-6.

Licensure requirements and implications of licensure:

License required to engage in consumer loan busi-

ness, i.e., make consumer loans of $50,000 or less

at rates greater than a non-licensee may charge.

§17:11C-3. Loan made without a required license is

void unless lender meets statutory good faith error

requirements. §17:11C-33(b).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute

applies to loans of $50,000 or less, payable in one or

more installments. §17:11C-2 (denition of “con-

sumer loan”). Term of closed-end installment loan in

an amount of:



$1,000 or less shall not exceed 36 months and 15

days.



More than $1,000 but no more than $2,500 shall not

exceed 48 months and 15 days.



More than $2,500 but no more than $5,000 shall not

exceed 60 months and 15 days.



More than $5,000 but no more than $10,000 shall

not exceed 84 months and 15 days.



Over $10,000 shall not exceed 120 months and 15

days.

§ 17:11C-35.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? Statute allows any

rate set by contract. §§17:11C-32(a), 17:11C-36(a).

However, criminal usury statute caps interest at 30%.

§§2C:21-19, 17:11C-37.

What loan fees are allowed? Recording fees. §17:11C-33.

What types of insurance are allowed, and any limits the

lending statute places on charges? Credit life insurance,

credit health or disability insurance, credit involun-

tary unemployment insurance, property insurance on

collateral. §17:11C-21(a).

Does statute prohibit all other fees besides those specically

allowed? Yes. §§17:11C-33(a), 17:11C-41(f).

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute contemplates single-payment

loans. §17:11C-3. Every multiple installment closed-

end xed-rate consumer loan contract must provide

for repayment in installments payable at approxi-

mately equal periodic intervals of time and arranged

so that no installment is substantially greater in

amount than any preceding installment, but adjust-

ments are allowed to accommodate seasonal income.

§17:11C-41(d).

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Borrower may prepay closed-end install-

ment loan in any amount at any time. §17:11C-34(c).

Prepayment penalties are likely prohibited because

not authorized by §17:11C-33(a). Statute is silent on

rebate method, but §17:11C-32 requires that inter-

est and payments be calculated based on actuarial

method, and that it should be computed only on

unpaid principal balances, which implies that actu-

arial rebates must be made.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Wage assign-

ments are prohibited and void. §17:11C-41(a). Liens

on real estate other than judgment liens are prohib-

ited. §17:11C-41(b).

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? No. Criminal usury statute,

§2C:21-19, prohibits charging more than 30% not-

withstanding any statute permitting an agreed rate.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report with information specied by

commissioner. §17:11C-43.

Other signicant features: Prohibits evasions, includ-

ing those accomplished by way of wage assignments

or sale-resale of personal property. §§17:11C-38,

17:11C-40, §17:11C-41(e). Loan-splitting prohibited.

§§17:11C-32(g), 17:11C-37.

NEW MEXICO

N.M. Stat. Ann. §§ 58-15-1 to 58-15-39

(Small Loan Act).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applies to lenders making loans of $2,500 or

less. Exempts banks, savings and loan associations,

credit unions, and licensed pawnbrokers. §58-15-

3(A), (C).

Licensure requirements and implications of licensure:

May not engage in business of lending in amounts of

$2,500 or less without rst having obtained a license.

§58-15-3(A).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute

applies only to “installment loan,” dened as a loan

that is to be repaid in a minimum of 4 successive sub-

stantially equal payments, with a period of no less

than 120 days to maturity. §58-15-2(E).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? Statute requires use

of simple interest method, §58-15-14.1, but does not

otherwise limit interest rates.

What loan fees are allowed? Recording fees, but not

notary fees for taking or releasing a lien. §58-15-

20(A), (C).

What types of insurance are allowed, and any limits the

lending statute places on charges? Statute allows term

life insurance or credit life insurance, but no other

type of life insurance, and prohibits property insur-

ance on unsecured loans. §58-15-16. Statute also

gives director the authority to regulate insurance

sales by licensees, §58-15-11, but does not otherwise

specify what types of insurance can be sold.

Does statute prohibit all other fees besides those specically

allowed? Fees not specically allowed are prohibited.

Does statute restrict balloon payments or require substan-

tially equal installments? Installment loan is dened

as one to be repaid in substantially equal payments.

§58-15-2(E).

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Prepayment penalties are unenforceable.

§58-15-15.1.

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Denition

of “installment loan” excludes those for which lender

requires post-dated checks or debit authorizations.

§58-15-2(E). §58-15-32 allows postdated checks and

ACH authorizations only for payday loans.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent, but state deceptive practices statute’s

prohibition against unconscionability has been

applied to loan charges.

Must lender underwrite or evaluate borrower’s ability to

repay? Annual report must include procedures the

licensee follows as a standard practice to establish

each consumer’s ability to repay a loan. §58-15-

10.1(A)(14).

Is lending under this statute exempt from state crimi-

nal usury law? No, but state’s criminal usury law,

§§30-43-1 to 30-43-5, applies only where violence or

other non-petty criminal acts are threatened or used

in collection of a debt that carries an interest rate

exceeding 45%.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: The statute requires an annual report giving

such relevant information as the director may reason-

ably require concerning the business and operations

during the preceding calendar year for each licensed

place of business. A summary of the reports shall

be included in the published annual report of the

director. §58-15-10(C). Annual report must include:

(1) a description of each loan product offered by the

licensee, including: (a) all fees; (b) the minimum,

maximum and average annual interest rate; (c) the

frequency of periodic payments; (d) the term of the

loan; and (e) any other standard conditions of the

loan product; (2) the total number of transactions

entered into for each loan product in the follow-

ing amounts: (a) $500 or less; (b) $501 to $1,000); (c)

$1,001 to $3,000; (d) $3,001 to $5,000; and (e) greater

than $5,000; (3) the total number of loans and the

total dollar amount of loan principal for each loan

product; (4) the average principal loan amount for

each loan product; (5) the total number of loans for

which the loan principal and accrued interest was

not paid in full; (6) the total dollar amount of princi-

pal loaned; (7) the total dollar amount of loan prin-

cipal repaid; (8) the total dollar amount of interest

received; (9) the total dollar amount and description

of fees received; (10) the total number of loans that

were secured by collateral of some type and the total

number of such loans in which the security was fore-

closed upon or repossessed; (11) the total amount of

loan principal and the total amount of accrued inter-

est written-off or charged-off; (12) the percent of con-

sumers who were new consumers; (13) the number

of loans that were renewed, renanced or extended

prior to being repaid in full; and (14) procedures the

licensee follows as a standard practice to establish

each consumer’s ability to repay a loan. §§58-15-10,

58-15-10.1(A). However, the department reports that

only licensees that make any loan product, with the

exception of payday loans, that exceeds an APR of

175%, are required to submit annual reports.

Other signicant features: Anti-evasion provisions.

§§58-15-3(D), 58-15-21.

NEW YORK

N.Y. Banking Law §§ 340 to 361 (McKinney)

(Licensed Lender Law).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applies to anyone making loans of $25,000 or

less to an individual for personal, family, household,

or investment purposes (up to $50,000 if a business or

commercial loan) who charges more than otherwise

legal rate. Does not apply to pawnbrokers licensed

under Gen. Bus. Law §§40–55. Banking Law §340.

Licensure requirements and implications of licensure:

License required. §340. Statute prohibits any entity

other than a licensee from charging interest greater

than the otherwise legal rate, and provides that a

loan is unenforceable if more interest is charged than

allowed by law. §356.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: $25,000 or

less ($50,000 or less if a business or commercial loan).

§§340, 351.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? §351 allows agreed

rate, but criminal usury law has 25% cap. N.Y. Penal

Law §190.40. For loans greater than the $25,000 or

$50,000 scope of this statue, licensee is limited to the

rate permitted by Gen. Oblig. Law §5-501 (namely

16%). Banking Law §353.

What loan fees are allowed? Recording fees, or non-

ling insurance premiums up to $7. §351(6)(a).

What types of insurance are allowed, and any limits the

lending statute places on charges? Property insurance

on collateral other than household goods if loan is for

$250 or more; liability insurance on a motor vehicle

securing the loan; credit life insurance, credit acci-

dent and health insurance, and credit unemployment

insurance. §357.

Does statute prohibit all other fees besides those specically

allowed? Yes. §§351(6), 353.

Does statute restrict balloon payments or require substan-

tially equal installments? Statute is silent.

Any restrictions on renancing? Renanced loan can

include only 60 days of unpaid interest from prior

loan, §351(4), but otherwise statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Actuarial rebate, but lender may keep

minimum charge of $10 and no refund of less than $1

need be made. §351(5)(a). Licensee must permit pay-

ment to be made in advance in any amount on any

loan at any time. §352. Prepayment penalties likely

prohibited since not authorized by §§351(3), 353.

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? May not

take lien other than judgment lien upon real estate.

§350(2). Assignment of unearned wages is prohibited

unless revocable or a payroll deduction plan. §354.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? No. See N.Y. Dept. of Fin. Servs., Bank-

ing Interpretation (Nov. 6, 2007), available at http://

www.dfs.ny.gov/legal/interpret_opinion/banking/

lo071106.htm; Banking Interpretation (June 13, 2006),

available at http://www.dfs.ny.gov/legal/interpret_

opinion/banking/lo060613.htm.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report giving such information as

superintendent may require. Superintendent shall

publish annual report showing the combined assets

and liabilities of all licensed lenders. §349.

Other signicant features: Not applicable.

NORTH CAROLINA

N.C. Gen. Stat. §§ 53-164 to 53-191

(Consumer Finance Act).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Law does not apply to banks, trust

companies, savings and loan associations, coopera-

tive credit unions, agricultural credit corporations

or associations organized under the laws of North

Carolina, production credit associations organized

under the Farm Credit Act, pawnbrokers, industrial

banks, the business of negotiating real estate loans,

or certain persons engaged in the business of dealing

in, buying, or discounting installment obligations

secured by personal property. §53-191.

Licensure requirements and implications of licensure:

Must have license to engage in business of lending in

amounts of $15,000 or less and contract for charges

greater than permitted by the state’s general usury

law (6 points above Treasury rate or 16%, whichever

is higher, as set by §24-1.1). §§53-166(a), 53-168(a).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute

allows licensees to make loans of $15,000 or less,

which must be repayable in substantially equal con-

secutive monthly payments over at least 12 months

but no more than 96 months. §53-176(a).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed?



For loan not exceeding $10,000, 30% on rst $4,000,

24% on next $4,000, and 18% on remainder.



For loan exceeding $10,000, 18%.

§ 53-176(a).

What loan fees are allowed?



Processing fee of $25 for loans up to $2,500; 1%

of the cash advance for loans above $2,500, not to

exceed a total fee of $40. §53-176(b).



Recording fees, or premium for non-ling insur-

ance if at least $1.00 less than recording fees, but

not notary fees. §53-177(a).

What types of insurance are allowed, and any limits the

lending statute places on charges? Credit life, credit

accident and health, credit unemployment, and credit

property insurance. §53-189.

Does statute prohibit all other fees besides those specically

allowed? Yes. §53-178.

Does statute restrict balloon payments or require substan-

tially equal installments? Must provide for repayment

in substantially equal installments at approximately

equal periodic intervals of time. §53-180(a). Pay-

ments must be due monthly. §53-176(a).

Any restrictions on renancing? Processing fee can be

charged no more than twice in any 12-month period.

§53-176(b). Upon renancing, loan principal can

include no more than 90 days of unpaid interest from

the prior loan. §53-173(b).

Any rebate requirements or restrictions on prepayment

penalties? Borrower may prepay all or any part of a

loan without penalty. §53-176(e). Statute is silent on

rebate requirements, but §53-173, which requires

interest to be calculated on the unpaid balances,

implies that rebates must be actuarial.

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Security

interests in real estate are prohibited. §§53-176(a),

53-180(f). Wage assignments are prohibited and

unenforceable. §53-180(b).

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Not applicable.

Reporting requirements, including detail about what

must be reported and whether there are any requirements

that the state agency review or take other steps regard-

ing the reports: Annual report, including licensee’s

assets, liabilities, income, expense, gain, loss, and any

other information as the commissioner may require.

§53-184(b).

Other signicant features: Anti-evasion provision.

§53-166. No loan splitting. §53-178. Licensee shall

not grant a loan in one ofce to any borrower who

already has a loan in another ofce (in-state or out-of-

state) operated by the same entity or a related entity.

§53-179. Sale of wages is a loan. §53-180(b).

N.C. Gen. Stat. §§ 24-1 to 24-11.2 (Interest—

General Provisions).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applies to all lenders. §§24-1.1(a), 53-141(2)

(applying these rates to industrial banks).

Licensure requirements and implications of licensure: Not

a licensing statute.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Does not

apply to loans over $300,000. §24-1.1(f).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Inter-

est rate limits inapplicable to loans over $300,000,

loans not made to individuals, loans for non-con-

sumer purposes, and revolving credit offered by

banks. §24-9.

What rate of interest is allowed?



For loan not exceeding $25,000, 16% or 6 percent-

age points above a Treasury bill rate, whichever is

higher.



For loan exceeding $25,000, no cap.

§ 24-1.1(a), (c).

What loan fees are allowed? For loan not secured

by real property, bank or savings institution may

charge origination fee of .025% of loan amount or

$50, whichever is higher. §24-1.1(e). Also, recording

fees, third-party fees, and fees due to governmental

bodies under loan guarantee and similar programs.

§24-8(d).

What types of insurance are allowed, and any limits the

lending statute places on charges? Statute is silent.

Does statute prohibit all other fees besides those specically

allowed? Statute allows parties to contract for inter-

est “not in excess” of the stated amounts. §24-1.1(a).

See also §§24-8 (general prohibition against charging

amounts other than those authorized), 53-141(2) (pro-

viding that industrial banks may charge interest “not

exceeding” these rates).

Does statute restrict balloon payments or require substan-

tially equal installments? Statute is silent.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Statute is silent.

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Statute is

silent.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: Statute is silent.

NORTH DAKOTA

N.D. Cent. Code §§ 13-04.1-01 to 13-04.1-17

(Money Brokers).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Chapter does not apply to: banks; credit

unions; savings and loan associations; insurance

companies; mortgage loan originators; state or

federal agencies and their employees; institutions

chartered by the Farm Credit Administration; trust

companies; any other person or business regulated

and licensed by the state; brokers, real estate brokers,

or real estate salespersons who arrange nancing for

real estate they are selling; retail sellers or others that

provide lease nancing; or leases on real property.

§13-04.1-02.1.

Licensure requirements and implications of licensure:

Must have license to engage in money broker-

ing (arranging or providing loans or leases).

§§13-04.1-01.1(4) (denition of “money brokering”),

13-04.1-02.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute

imposes restrictions only on loans of $1,000 or less.

For these loans, loan term must not exceed 24 1/2

months. §13-04.1-09.2(1), (5).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed?

For loans of $1,000 or less:



30% on rst $250;



24% on next $250;



21% on next $250; and



18% on remainder

Lender may calculate nance charge on an add-on

(dollars per hundred) basis as long as the resulting

nance charge does not exceed these percentage-

based amounts. §13-04.1-09.2(1). For loans over

$1,000, there is no restriction on nance charges.

The criminal usury statute’s cap is 5.5 percentage

points above a Treasury bill rate, but no less than 7%,

§47-14-09, but it is inapplicable to any loan made by

a lending institution which is regulated or funded

by an agency of a state or of the federal government,

so would not apply to a lender licensed under this

statute.

What loan fees are allowed? Recording fees.

§13-04.1-09.2(7).

What types of insurance are allowed, and any limits the

lending statute places on charges? Statute allows lender

to charge premium for insurance “provided for by

rule,” §13-04.1-09.2(7), but no rules have been found,

so lenders do not have authority to charge borrow-

ers for insurance for the loans of $1,000 or less that

are subject to this provision. Other than that, statute

is silent, except that it provides that it is a violation

to knowingly cause or require a borrower to obtain

property insurance coverage in an amount that

exceeds the replacement cost of the improvements as

established by the property insurer. §13-04.1-09(14).

Does statute prohibit all other fees besides those spe-

cically allowed? Yes, for loans of $1,000 or less.

§13-04.1-09.2(7).

Does statute restrict balloon payments or irregular pay-

ment schedules? Loans must require payment in

installments payable at approximately equal periodic

intervals, except to accommodate borrowers with

seasonal incomes. No installment contracted for may

be substantially larger than any preceding install-

ment. §13-04.1-09.2(1), (5) (applicable to loans of

$1,000 or less).

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Yes, for loans of $1,000 or less. For prepay-

ment in full of loan under §13-04.1-09.2 in which

charges have been calculated on an add-on (dollar

per hundred) basis, lender must make Rule of 78s

rebate, but no refund of $1 or less need be made.

§13-04.1-09.2(2). Prepayment penalties are likely pro-

hibited because not authorized by §13-04.1-09.2(7).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Statute is

silent.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Criminal usury statute’s cap

applies “[e]xcept as otherwise provided by the laws

of this state,” and also does not apply to a loan

“made by a lending institution which is regulated or

funded by an agency of a state or of the federal gov-

ernment.” §47-14-09(2)(e).

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: Loan splitting prohibited for

loans of $1,000 or less. §13-04.1-09.2(6).

OHIO

Ohio Rev. Code Ann. §§ 1321.01 to 1321.20

(West) (Small Loans).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Does not apply to:



Banks, savings banks, savings societies, trust com-

panies, or credit unions.



Savings and loan associations whose business is

substantially conned to real estate loans and evi-

dences of their own indebtedness.



Lenders registered under §§1321.51 to1321.60

(Second Mortgage Security Loans).



Insurance premium nance companies.



Licensees under the Short Term Loan Act.



Licensees under the state insurance law.

§ 1321.02.

Licensure requirements and implications of licensure:

Must have license to engage in business of lending

money in amounts of $5,000 or less and charge inter-

est and charges greater than amount that would be

allowable for unlicensed lender. Loan in violation of

this requirement is void. §1321.02.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: $5,000 or

less. §1321.02.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? 28% on rst $1,000,

and 22% on remainder, §1321.13(A), or agreed rate

up to 25%. §1321.15(B). However, a credit services

organization that is completely separate from the

lender may be able to charge a fee to arrange a loan

at these rates, thereby increasing the cost of credit to

the borrower.

What loan fees are allowed?



Recording fees.



Fees for credit reports.



For loan of $500 or less, origination fee of $15 or

1% of the principal, whichever is greater; for all

other loans, $30 or 1% of the principal, whichever is

greater.

§ 1321.13(G), (I).

What types of insurance are allowed, and any limits the

lending statute places on charges?

Credit life, accident and health insurance, and unem-

ployment insurance; property insurance on collateral

or other property. §1321.13(E), (F).

Does statute prohibit all other fees besides those specically

allowed? Yes. §1321.13(G). However, Ohio Admin.

Code 1301:8-2-20 allows licensees to engage in other

transactions with borrowers, provided the transac-

tions are not a condition of the loan.

Does statute restrict balloon payments or require sub-

stantially equal installments? Precomputed loan must

be repayable in substantially equal and consecutive

monthly installments, but lender may make adjust-

ments to accommodate borrower with seasonal

income, and minor deviations are allowed for rst

payment. §1321.13(D)(1).

Any restrictions on renancing? Allowable origination

fee is reduced to $15 for renancing of loan of $500

or less within six months, and reduced to $30 for any

renancing of loan over $500. §1321.13(I).

Any rebate requirements or restrictions on prepayment

penalties? Rule of 78s if loan term is 61 months or less;

otherwise actuarial. §§1321.01(A)(9) (denition of

“applicable charge”), 1321.13(D)(3).

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Security

interest, other than judgment lien, in real estate is

prohibited. §1321.12. Wage assignments are invalid,

but employee may authorize revocable payroll

deduction plan. §1321.32.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Statute is silent, but criminal usury stat-

ute, §2905.21, allows interest in excess of its cap if

“otherwise authorized by law.”

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report giving information as required

by the superintendent of nancial institutions. The

division publishes an annual analysis and recapitula-

tion of the reports. §1321.09(A).

Other signicant features: Loan-splitting prohibited.

§1321.15.

Statute name and citation: Ohio Rev. Code Ann.

§§1321.51 to 1321.60 (Second Mortgage Security

Loans).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Does not apply to:



Banks, savings banks, trust companies, savings and

loan associations, and credit unions, and their sub-

sidiaries if regulated by a federal banking agency

and owned and controlled by the depository

institution.



Life, property, or casualty insurance companies

licensed to do business in the state Loans made

pursuant to §§1321.01 to 1321.19 (Small Loan Act).



Business loans described in §1343.01(B)(6).



Political subdivisions and governmental agencies

and organizations.



Colleges.



Credit union service organizations that use services

provided by registered mortgage loan originators

or that hold a valid letter of exemption.

§ 1321.53(D).

Licensure requirements and implications of licensure:

Must register in order to, inter alia, make loans of

$5,000 or more that exceed the generally applicable

interest rate cap and are unsecured or secured by

other than real property. §1321.52(A)(1)(d), (C).

Lender has no right to collect any interest or charges

on loan made in violation of registration requirement.

§1321.52(D).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Registra-

tion requirement applies only if lender is making

residential mortgage loans or loans of $5,000 or more

that are unsecured or secured by other than real

estate. §1321.52(A)(1)(d).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? 21% or agreed rate up

to 25%. §§1321.57(A), 1321.571.

What loan fees are allowed?



Recording fees. §1321.57(H).



Fee up to $10 for credit investigation. §1321.57(H).



Origination charges as follows (§1321.57(J)):



For unsecured loans, $15 if loan is $500 or less;

$30 if loan is more than $500 but less than $1,000;

$100 if loan is at least $1,000 but less than $5,000;

and $250 or 1% of principal, whichever is greater,

if loan is at least $5,000;



For loan secured by goods or real estate, $15 if

loan is $500 or less; $30 if loan is more than $500

but less than $1,000; $100 if loan is more than

$1,000 but less than $2,000; $200 if loan is at least

$2,000 but less than $5,000; and $250 or 1% of

principal, whichever is greater, if loan is at least

$5,000.

What types of insurance are allowed, and any limits the

lending statute places on charges? Credit life insurance,

credit accident and health insurance, and unemploy-

ment insurance; property insurance on collateral and

other property. §1321.57(F).

Does statute prohibit all other fees besides those specically

allowed? Yes. §1321.57(H). However, it also provides

that it does not prohibit a registrant from engaging in

other transactions with the borrower, provided that

they are not a condition of the loan.

Does statute restrict balloon payments or irregular pay-

ment schedules? Precomputed loans must be repay-

able in monthly installments of principal and interest

combined, except that minor variations are allowed

for due date and amount of rst payment, and

installment due dates may be omitted to accommo-

date borrowers with seasonal income. §1321.57(D).

Any restrictions on renancing? If renancing occurs

within 90 days, lender cannot charge origination fee

on amount applied to unpaid balance of prior loan.

§1321.57(J)(2).

Any rebate requirements or restrictions on prepayment

penalties? When a precomputed loan is prepaid in

full, Rule of 78s rebate (sum of the balances method)

if loan term is 61 months or less; otherwise actuarial

rebate. §§1321.51(I), 1321.57(D)(3). Special rules for

loans secured by real estate §1321.57(G). Prepayment

penalties are likely prohibited because not authorized

except for loans secured by real estate. §1321.57(G),

(H)(1).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? A registrant

may make unsecured loans, loans secured by a rst

or junior mortgage on a borrower’s real estate, loans

secured by other than real estate, and loans secured

by any combination of mortgages and security inter-

ests. §1321.52(C). Wage assignments are invalid, but

employee may authorize revocable payroll deduction

plan. §1321.32.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Statute is silent, but criminal

usury statute, §2905.21, allows interest in excess of

its cap if “otherwise authorized by law.”

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report. The division shall publish an

annual analysis of the information. §1321.55(B).

Other signicant features: Loan splitting prohibited.

§1321.59.

OKLAHOMA

Okla. Stat. tit. 14A, §§ 1-101 to 6-113

(Consumer Credit Code).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Act prescribes maximum charges for all credi-

tors, except lessors, but excludes:



Extensions of credit to government or governmen-

tal agencies.



Most sales of insurance.



Transactions under public utility or common carrier

tariffs if certain elements are regulated.



Pawnbrokers.



For most purposes, loans to build or purchase a

residence or to renance such a loan when made by

a lender whose loans are supervised by an agency

of the U.S. or made by a FHA approved mortgagee.

§ 1-202. In addition, “consumer loan” is dened to

exclude, for purposes other than disclosure require-

ments, loans granted by institutions of postsecondary

education, and certain loans secured primarily by

an interest in land if nance charge does not exceed

13%. §§3-104, 3-105.

Licensure requirements and implications of licensure: In

order to make (or take an assignment of and collect) a

supervised loan (dened by §3-501 as one exceeding

10% interest), must either be a supervised nancial

organization (a depository institution organized,

chartered, or authorized under Oklahoma or U.S.

statutes) or obtain a license. §3-502. Loan made in

violation of licensure requirements is void. §5-202.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Excludes

loans over $50,000 (adjusted annually for ination)

except for private student loans and loans secured

by an interest in land. §3-104. For loans of $1,470 or

less made under §3-508B, maximum loan term is one

month for each $20 of principal (one month for each

$10 if loan is for less than $490, up to a maximum

term of 18 months). For loans greater than $143.95

made under §3-508B, the minimum loan term is 60

days. §3-508B(2), (3). Closed-end supervised loan of

$4,900 or less at more than 18% must be payable over

no more than 49 months (no more than 37 months if

principal is $1,470 or less). §3-511.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? For loan other than

supervised loan, 10%. §3-201(1). For supervised loan,

either:



25%; or



27% on rst $2,910, 23% on amount over $2,910

but not exceeding $6,200, and 20% on amount over

$6,200. §3-508A.

In the alternative, on loans of $1,470 or less, super-

vised lender may charge:



For loan up to $143.95, $4.80 for each $24.00 of

principal.



For loan over $143.95 and up to $171.50, 10% of the

amount of the principal, plus $14.70 per month as

installment account handling charge.



For loan over $171.50 but not exceeding $343.00,

10% of the principal plus $17.15 per month as

installment account handling charge.



For loan over $343.00 but not exceeding $490.00,

10% of the principal plus $19.60 per month as

installment account handling charge.



For loan over $490.00 but not exceeding $735.00,

10% of the principal plus $22.05 per month as

installment account handling charge.



For loan over $735.00 but not exceeding $1,470.00,

10% of the principal plus $24.50 per month as

installment account handling charge

§ 3-508B(1).

What loan fees are allowed?



Ofcial fees, dened by §1-301(11) as recording

fees or non-ling insurance premium if less than

those fees.



Reasonable closing costs and taxes, including taxes

for recording instruments.



Charges for other benets, including insurance, if

valuable to debtor, reasonable in cost, and autho-

rized by rule.



A charge for processing debtor’s application for

credit, including but not limited to costs of ser-

vices such as credit reports, credit investigations,

appraisals, and fees for preparation of loan-related

documents.



Fees for pest infestation or ood hazard inspections

conducted prior to closing.

§ 3-202(1). Section 6-104(4) gives the administrator

the authority to adopt rules limiting these charges.

This authority includes limiting the charges if neces-

sary to protect Oklahoma debtors from being sub-

jected to charges which are unreasonable or excessive

as compared to the prevailing charges being imposed

by out-of-state lenders and sellers.

What types of insurance are allowed, and any limits the

lending statute places on charges? Statute allows credi-

tor to charge for insurance written in connection with

the loan, other than insurance protecting the lender

against the debtor’s default or other credit loss, and

specically mentions property or liability insur-

ance and credit life, accident, and health insurance.

§§3-202(3), 4-104. Insurance charges are not allowed

on loans made under §3-508B (loans of $1,470 or

less). §3-508B(5).

Does statute prohibit all other fees besides those specically

allowed? §3-508B(5), which governs certain loans of

$1,470 or less, prohibits any other fees, but otherwise

statute is silent.

Does statute restrict balloon payments or irregular pay-

ment schedules? For closed-end consumer loan, debtor

has right to renance any balloon payment without

penalty on terms at least as favorable as original

terms, unless payment schedule was adjusted to sea-

sonal or irregular income of debtor. §3-402. Any loan

made under the terms of §3-508B (loans of $1,470 or

less) shall be scheduled to be payable in substantially

equal installments at not less than 30-day intervals.

§3-508B(3). Closed-end supervised loan of $4,900

at more than 18% must be payable in substantially

equal installments at equal periodic intervals except

to accommodate debtor’s seasonal or irregular

income. §3-511.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Debtor may prepay in full at any time

without penalty. §3-209. Upon prepayment in full of

precomputed loan, borrower is entitled to actuarial

rebate if loan term is more than 61 months, but oth-

erwise Rule of 78s rebate (sum of balances method).

No rebate required if less than $1.00, and lender may

keep minimum charge of $5.00 if principal was $75

or less, or $7.50 if principal was more than $75.00.

§3-210.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Wage assign-

ments are prohibited and unenforceable, but

employee may revocably authorize deductions from

earnings. §3-403(1). Security interest in land is pro-

hibited and void for supervised loan with principal

or credit limit of $4,900 or less and nance charge

over 21%. §3-510. Security interest in motor vehicle is

prohibited for supervised loan of $300 or less. §3-515.

Does statute prohibit unconscionable loan charges? Yes.

§5-108.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Supervised lenders are required to le an

annual report regarding their business operations for

each licensed place of business. The department com-

piles the information from each licensee’s report into

a consolidated report of the industry. §3-506(5).

Other signicant features: Prohibits loan-splitting.

§3-509.

OREGON

Or. Rev. Stat. §§ 725.010 to 725.910

(Consumer Finance Act).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applies to any person making “consumer

nance loans,” dened as secured or unsecured loans

or lines of credit that have periodic payments and

terms longer than 60 days. §§725.010, 725.045. How-

ever, the Act does not apply to loans of $50,000 or less

(including business and agricultural loans) if inter-

est rate does not exceed the greater of 12 percent, or

ve percent in excess of the discount rate. §725.045

(cross-referencing §§82.010, 82.025). See next entry

for exemptions from licensure requirement.

Licensure requirements and implications of licensure:

Must have license to conduct a business in which

person makes a consumer nance loan of $50,000

or less, or acts as an agent, broker or facilitator for a

person that makes such a loan. §725.045(1). Section

725.045 creates an exception by cross-referencing

§82.025, which makes the generally-applicable

prohibition against lending at a rate greater than

authorized by statute inapplicable to FDIC-insured

depository institutions, trust companies, credit

unions, pawnbrokers, HUD-approved mortgage

lenders, rst lien and purchase money mortgage

loans, certain other mortgage loans, federally guar-

anteed or insured loans, loans by tax-qualied

retirement plans, bona de sales of securities or com-

mercial paper, and interest charged by broker-dealers

in certain circumstances.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: “Con-

sumer nance loan” means a loan that is unsecured

or secured by personal or real property and that has

periodic payments and terms longer than 60 days.

§725.010(2).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? The greater of 36%

APR or 30 percentage points in excess of the discount

window primary credit rate. §725.340(1).

What loan fees are allowed? May contract for and

receive other reasonable and bona de fees, expenses

or damages, subject to oversight and regulation by

the Department of Consumer and Business Services,

including, by cross-reference to TILA, taxes and

recording fees or non-ling insurance if no greater

than the recording fees, and similar pass-through

fees or charges. §725.340(1)(b). The statutory list also

includes prepayment fees and various types of col-

lection expenses. The Department’s regulations, Or.

Admin. R. 441-730-0000 to 441-730-0320, do not spec-

ify any other charges and fees that are allowed.

What types of insurance are allowed, and any limits the

lending statute places on charges? Statute specically

allows force-placement of insurance on the collateral,

but otherwise is silent about insurance. §725.340(3).

The Department’s regulations, Or. Admin. R. 441-

730-0000 to 441-730-0320, refer to credit insurance but

do not specify the types for which the borrower may

be charged.

Does statute prohibit all other fees besides those specically

allowed? Statute is silent. Section 725.340(1)(b) pro-

vides for the collection of “other reasonable and bona

de fees, expenses or damages, subject to oversight

and regulation” and provides examples, but fees are

not limited to those examples.

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Upon prepayment in full of precomputed

loan, borrower is entitled to actuarial rebate, but

lender may keep minimum charge of $75 or 10% of

amount nanced, whichever is less. §725.340(2)(c). In

addition, Or. Admin. R. 441-730-0205 prohibits pre-

payment penalties in certain circumstances.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Loan may be

unsecured or secured by personal or real property.

§725.010(2). Wage assignments are prohibited and

unenforceable, but borrower may recovably autho-

rize payroll deductions. §725.355. Or. Admin. R. 441-

730-0015 prohibits lender from requiring postdated

check or debit authorization as a condition of making

a loan.

Does statute prohibit unconscionable loan charges? No,

but statute limits fees other than interest to those that

are reasonable and bona de. §725.340(1)(b).

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent, but Or. Admin. R. 441-730-

0015 requires a determination of the creditworthi-

ness of a borrower based on the information about

the borrower’s nancial condition, such as his or her

income, assets, debts, and nancial obligations, and

the nature and value of any collateral used to secure

the loan for the majority of loans made under a con-

sumer nance license.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what

must be reported and whether there are any requirements

that the state agency review or take other steps regard-

ing the reports: Annual report containing information

required by the director. §725.190.

Other signicant features: Not applicable.

PENNSYLVANIA

7 Pa. Stat. Ann. §§ 6201 to 6219 (West)

(Consumer Discount Company Act).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Does not apply to: banking institutions,

building and loan associations, credit unions, or enti-

ties licensed by the state Secretary of Banking under

any other statute; installment sales or lease-purchases

of personal property; or non-prot membership orga-

nizations that nance physicians’, surgeons’, or den-

tists’ obligations. §6217.

Licensure requirements and implications of licensure:

License required to engage in business of making

loans of $25,000 or less and charge more than would

be permitted without a license. §6203.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: $25,000

or less. §6203. Lender may not charge discount inter-

est on loan with term exceeding seven years and 15

days. §6214(H).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? Either 24% actuarial, or

discount interest, calculated as follows:



When contract is payable within 48 months, $9.50

per $100 per year.



When contract is payable in more than 48 months,

discount interest of $9.50 per $100 per year for

the rst 48 months plus $6 per $100 per year for

remainder.

§§ 6213(E), 6217.1.

What loan fees are allowed?



Service charge of $1.50 for each $50.00 or fraction

thereof, capped at $150.00, when interest is charged

by the discount method §6213(F).



Minimum charge of $6.00 per year ($3.00 per year if

loan is for $25 or less. §6213(G).



Recording fees. §6213(M).

What types of insurance are allowed, and any limits the

lending statute places on charges? Statute allows lender

to charge insurance premiums. §§6213(N), 6214(B).

Statute refers to insurance on collateral, §6218, but

otherwise does not specify what types of insurance

are allowed. Lender may also sell automobile and

home security plans. §6213(Q)(2).

Does statute prohibit all other fees besides those specically

allowed? Yes. §6214(B).

Does statute restrict balloon payments or irregular pay-

ment schedules? Lender may require payment of con-

tracts in equal weekly, semi-monthly, monthly or any

other periodic installments. §6213(J). All installment

contracts shall provide for repayment in substantially

equal periods and in substantially equal amounts,

except as necessary to take borrower’s intermittent

income into account. §6214(F).

Any restrictions on renancing? Licensee may charge

service charge only on new money portion of re-

nance within four months of original loan. §6214(E).

Any rebate requirements or restrictions on prepayment

penalties? Borrower may prepay in whole or part at

any time. Upon prepayment in full, borrower is enti-

tled to Rule of 78s rebate (sum of balances method),

but lender need not make rebate of less than $1.

§6214(D). Prepayment penalties are likely prohibited

because not authorized by §6214(B).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Loan may be

unsecured or secured by real or personal property.

§6213. However, licensees that engage in residential

mortgage lending must meet special requirements

under Pennsylvania’s Mortgage Licensing Act, 7 Pa.

Cons. Stat. Ann. §§6101 to 6153.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? This statute is silent, but

criminal usury statute, 18 Pa. Stat. Ann. §§4806.1(h),

4806.3, applies only when interest over its 36% cap is

not otherwise authorized by law

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report giving information as the Sec-

retary of Banking may require. §6210.

Other signicant features: No loan splitting. §6214(C).

Does not prohibit wage assignments and sale-resale

arrangements, but provides that the amount the

lender receives in excess of the amount borrowed is

interest. §6218. Anti-evasion provisions. §6218.

RHODE ISLAND

R.I. Gen. Laws §§ 19-14-1 to 19-14-7

(licensure provisions), §§ 19-14.2-1 to

19-14.2-16 (Small Loan Lenders Act).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Chapter 14, which includes primarily

the licensing provisions, is inapplicable to a variety

of types of business loans; certain loans made by life

insurance companies; certain educational loans; the

purchase of retail or loan installment contracts from

a federal bank receiver or liquidator; credit sales;

municipal, state, or federal agencies that make loans;

and the negative equity portion of vehicle nancing.

Licensing provisions also do not apply to nonprot

charitable, educational, or religious organizations;

persons who make fewer than 6 loans in a 12-month

period; regulated institutions and banks or credit

unions, including out-of-state banks and credit

unions that meet certain conditions; closing agents;

employees of lenders; attorneys performing loan

closings; or licensed check cashers that make payday

loans. §19-14.1-10.

Licensure requirements and implications of licensure: Sec-

tions 19-14-1 and 19-14-2 require a variety of lenders,

including small loan lenders, to be licensed.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: $5,000 or

less. §§19-14.2-1, 19-14.2-8. Term of loan of $1,000 or

less may not exceeds 25 months. Term of loan exceed-

ing $1,000 but not exceeding $5,000 may not exceed

60 months. §19-14.2-11.

Other restrictions on applicability of statute (e.g., it

only applies if lender takes a mortgage on real property):

“Small loan” is dened as one not secured by real

estate. §19-14-1(12).

What rate of interest is allowed?



For loans up to and including $300, 36%.



For loans exceeding $300 but not exceeding $800,

30%.



For loans exceeding $800 but not exceeding $5,000,

24%.

§ 19-14.2-8.

What loan fees are allowed? Lawful ling fees, plus

“other fees listed in §6-26-2(c) or as authorized by

regulation.” §19-14.2-12. The additional fees listed in

§6-26-2 are attorney fees for preparation of loan doc-

uments, fees for title examination or title insurance,

and “other customary and reasonable costs incident

to the closing, supervision, and collection of loans in

this state.”

What types of insurance are allowed, and any limits the

lending statute places on charges? Credit life insurance,

credit accident and health insurance, credit unem-

ployment insurance, property and liability insurance

on collateral. §§19-14.2-3, 19-14.2-12 (incorporating

§6-26-2, which incorporates tit. 27, chs. 30 and 31).

Does statute prohibit all other fees besides those specically

allowed? Yes. §19-14.2-12.

Does statute restrict balloon payments or require substan-

tially equal installments? Contract must provide for

repayment of the loan in substantially equal install-

ments at approximately equal periodical intervals of

time. §19-14.2-11.

Any restrictions on renancing? Principal of renance

loan cannot include unpaid interest that accrued on

the prior loan more than 60 days previously, and

cannot include any unpaid interest more than once in

any 12-month period. §19-14.2-10.

Any rebate requirements or restrictions on prepayment

penalties? Lender shall permit prepayment in any

amount at any time. §19-14.2-4(2). Prepayment pen-

alties are likely prohibited because not authorized

by §19-14.2-12. For precomputed interest on loans of

60 months or less, rebates to be calculated using the

Rule of 78s. If greater than 60 months, simple interest

method. §19-14.1-2.

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Statute

prohibits wage assignments. §19-14.2-5(5). Statute

regulates security interests in household furniture

but does not prohibit them. §19-14.2-7.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Statute is silent, but criminal usury stat-

ute, §6-26-2, states that its interest rate limits are “[s]

ubject to the provisions of title 19.”

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report with information that director

may reasonably require. §19-14-22.

Other signicant features: Wage assignments are pro-

hibited. §19-14.2-5(5). Wage assignment transaction

is a loan. §19-14.2-6. No loan splitting. §19-14.2-9.

Anti-evasion provision. §19-14.2-1(2).

SOUTH CAROLINA

S.C. Code Ann. tit. 37, ch. 3 (“South Carolina

Consumer Protection Code-Loans”).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applies generally to all lenders except federal

credit unions (§37-1-202(10)). It applies to:



Supervised nancial organizations (i.e., a fed-

erally or state supervised depository lender,

§37-1-301(27)).



Supervised lenders (a lender authorized to make

supervised loans (i.e., loans at greater than 12%

interest §37-3-502) §37-3-501(2).



Restricted Lenders (a lender licensed under tit. 34,

ch. 29 to make loans of $7,500 or less) except for

their rates and charges (and the requirements for

supervised lenders are inapplicable to restricted

lenders).

Does not apply to:



Extensions of credit to governments or governmen-

tal agencies.



Most insurance sales, insurance rates, and insur-

ance premium nance company transactions.



Transactions under public or municipal utility or

common carrier tariffs that meet certain conditions.



Pawnbrokers.



Rates and charges for restricted lenders, and their

examination and licensing.



Agricultural credit, for most purposes.



Government-supported student loans.



Federal credit unions.



Certain transactions in securities or commodities

accounts.

§ 37-1-202.

Licensure requirements and implications of licensure: To

make supervised loans (dened by §37-3-501(1) as

consumer loans exceeding 12% interest other than

mortgage loans and deferred presentment (payday)

loans), or to take assignments of them and collect on

them, must either be a “supervised nancial orga-

nization” (dened by §37-1-301(27) as a depository

institution or an organization authorized to advance

or service insurance premiums) or obtain a license.

§37-3-502. If creditor makes supervised loan without

a required license, consumer has claim for actual and

statutory damages, and is not obligated to pay the

excess charge. §37-5-202.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: “Con-

sumer loan” is dened as one in which principal

does not exceed $90,000 (adjusted for ination from

$25,000) or the debt is secured by land. §37-3-104.

Supervised loan of $1,080 (adjusted for ination from

$300) or less must be payable over no more than 25

months; if more than $1,080 but no more than $3,600

(adjusted for ination from $1,000), must be payable

over no more than 37 months. §37-3-511.

Other restrictions on applicability of statute (e.g., it

only applies if lender takes a mortgage on real property):

“Consumer loan” is dened to exclude those where

principal exceeds $90,000 (adjusted for ination from

$25,000) unless the debt is secured by land. §37-3-

104. However, rst lien mortgage loans are excluded

from the denition of “consumer loan” for purposes

of the provisions that are relevant to this summary.

§37-3-105. In addition, “supervised loan” is dened

to exclude those secured by residential real estate or

the borrower’s dwelling. §37-3-501(1)(a).

What rate of interest is allowed? Lenders who are not

supervised lenders: 12% per year. §37-3-201(1).

Supervised nancial organizations (dened by

§37-1-301(27) as federally or state supervised deposi-

tory lenders): 18% or any other rate that lender les

and posts. §37-3-201(2)(b). Supervised lenders may

charge 18% (§37-3-201(c)) or:



On loan not exceeding $150: $2.50 per month, plus

initial charge of 7% of cash advance or $56, which-

ever is less. (The total amount is considered to be

the nance charge.)



On loan of more than $150 but not exceeding $600:

$25 per $100 per year (calculated by the add-on

method), plus 7% of cash advance or $56, which-

ever is less.



On loan of more than $600: any rate that lender les

and posts.

§37-3-201(2)(a) (setting rates for loans up to $600 as

those authorized by §34-29-140, and requiring that

maximum charge not exceed the rate led with the

state and posted); §37-3-201(2)(b) (allowing any led

and posted rate for loan over $600).

What loan fees are allowed?



Ofcial fees (dened by §37-1-301(17) as recording

fees or, with some limitations, non-ling insur-

ance premiums, limited by §37-4-208 to 75% of the

recording fees) and taxes.



Charges for other benets conferred on the debtor,

if valuable to the debtor and reasonable in price,

of a type which is not for credit, and authorized by

rule as permissible additional charges.

§ 37-3-202(1).

What types of insurance are allowed, and any limits

the lending statute places on charges? May charge for

insurance, including property insurance on property

related to the credit transaction; liability insurance;

credit life, accident and health, and unemployment

insurance; vendor’s single interest insurance; and

non-credit term life insurance; but cannot charge for

insurance protecting the lender against the debtor’s

default or other credit loss. §37-3-202.

Does statute prohibit all other fees besides those specically

allowed? Consumer is not obligated to pay a charge in

excess of that allowed by the statute. §37-5-202(2).

Does statute restrict balloon payments or irregular pay-

ment schedules? Consumer has right to renance

any balloon payment without penalty at terms no

less favorable than the original terms, with various

exceptions, unless contract provides a different for-

mula. §37-3-402. Supervised loan of $3,600 or less

(adjusted for ination from $1,000) must be repayable

in substantially equal installments at equal periodic

intervals except when adjusted due to borrower’s

seasonal or irregular income. §37-3-511.

Any restrictions on renancing? Lender holding license

as supervised lender may not renew a loan of $1,000

or less more than one time during any 15-month

period where the amount actually given to the cus-

tomer is less than ten percent of the net outstanding

loan balance at the time of renewal. §37-3-515.

Any rebate requirements or restrictions on prepayment

penalties? Debtor may prepay in full at any time with-

out penalty. §37-3-209. Upon prepayment in full of

a precomputed consumer loan, lender has option

of either actuarial or Rule of 78s rebate if loan has

no more than 61 installments; otherwise actuarial

method is required. Whether loan is precomputed

or not, creditor may retain minimum charge up to

$15, and no rebate of less than $1.00 need be made.

§37-3-210.

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? “Con-

sumer loan” does not include a loan secured by a

rst lien or equivalent security interest in real estate.

§37-3-105(1). “Supervised loan” is dened to exclude

those secured by residential real estate or the bor-

rower’s dwelling. §37-3-501(1)(a). A security interest

in land is prohibited and void for a supervised loan

of $3,600 or less (adjusted for ination from $1,000).

§37-3-510. Wage assignments are prohibited and

unenforceable, but borrower may revocably autho-

rize payroll deductions. §37-3-403.

Does statute prohibit unconscionable loan charges? Yes.

§37-5-108.

Must lender underwrite or evaluate borrower’s ability to

repay? No separate requirement, but must consider to

determine if unconscionable. §37-5-108(4)(b).

Is lending under this statute exempt from state criminal

usury law? Not applicable.

Reporting requirements, including detail about what

must be reported and whether there are any requirements

that the state agency review or take other steps regard-

ing the reports: Entities licensed to make supervised

loans must le annual report stating: the number

and aggregate dollar amounts of loans that renewed

existing accounts, that were made to new borrowers;

that received a nal entry other than by renewal; the

number of new loans and aggregate dollar amounts

made to former borrowers; the number of renewals

in which the borrower received a cash advance which

was less than ten percent of the net outstanding loan

balance at the time of renewal; the number of loans

and aggregate dollar amounts outstanding at the

beginning and at the end of the reporting period; and

the highest annual percentage rate and most frequent

annual percentage rate charged by the lender on

loans of various sizes. §37-3-505.

Other signicant features: Prohibits loan splitting for

supervised loans. §37-3-509.

S.C. Code Ann. §§ 34-29-10 to 34-29-260

(Consumer Finance Law).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Consumer nance companies (also referred

to as restricted lenders), dened as all persons con-

ducting the business of making advances of cash in

amounts of $75,000 or less. §§34-29-10, 37-3-501(3).

Excludes banks, savings and loan associations, sav-

ings banks, trust companies, insurance companies,

credit unions, licensed pawnbrokers, and loans made

to corporations. §34-29-20(b).

Licensure requirements and implications of licensure:

Must be licensed in order to engage in business of

lending amounts of $7,500 or less at interest rate

higher than general usury statute allows (which

§34-31-20 sets at 8.75%). §34-29-20(a).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute

allows loans of $7,500 or less. §34-29-140(a). Loan

term cannot exceed:

Cash advance of $1,000 or less 24 1/2 months

Cash advance of $1,001 to $1,500 36 1/2 months

Cash advance of $1,501 to $2,000 48 1/2 months

Cash advance of $2,001 to $7,500 60 1/2 months

§ 34-29-140(b).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed?



For loan not exceeding $150: $2.50 per month.



For loan exceeding $150 but not exceeding $2,000:

$25 per $100 per year on rst $720 (adjusted for

ination from $600, $18 per $100 per year on

amount exceeding $720 but no more than $1,200

(adjusted for ination from $1,000), and $12 per

$100 per year on amount exceeding $1,200 but

not exceeding $2,400 (adjusted for ination from

$2,000). These rates are calculated by the add-on

method.



For loan of more than $2,400 but not exceeding

$7,500: add-on rate of $9 per $100 per year.

In addition, a $2 maintenance fee for each month in

the loan term. §34-29-140(a)(3), (i), (j).

What loan fees are allowed?



For loans authorized under §34-29-140(a)(1) and

(2), i.e., loans up to $2,400 (adjusted for ination

from $2,000), 7% of the cash advance or $56, which-

ever is less.



For loans authorized under §34-29-140(c), i.e.,

loans between $2,400 and $7,500, 5% of the cash

advance or $200, whichever is less.

§ 34-29-140. In addition, lender can charge for

recording fees, or non-ling insurance if no more

than 75% of those fees, §34-29-164.

What types of insurance are allowed, and any limits the

lending statute places on charges? Property insurance

on personal property that is collateral; insurance on

life and earning capacity of not more than two obli-

gors; accident and health insurance. §§34-29-160.

Does statute prohibit all other fees besides those speci-

cally allowed? Yes. If an amount in excess of charges

permitted by chapter 29 is charged, contracted for, or

received, except as result of accidental or bona de

error, the contract of loan is void, and licensee has

no right to collect or receive any principal, interest,

charge, or recompense. §34-29-140(e).

Does statute restrict balloon payments or irregular pay-

ment schedules? Payments must be in substantially

equal, consecutive monthly installments and shall be

in an amount not less than $10 per month, exclusive

of nance charges. §34-29-140(b). However, loans

not exceeding $150 may be payable weekly. §34-29-

140(a)(1).

Any restrictions on renancing? Lender may not renew

a loan more than one time during any 15-month

period where the actual dollars given to the customer

is less than 10% of the net outstanding loan balance

at the time of renewal. §34-29-140(k). For loans up

to $2,000, lender may impose initial charge (7% or

$56) on a renewal loan only once in any three-month

period. §34-29-140(a)(2). For loans over $2,000,

lender may impose initial charge (5% or $200) only

once on a renewal loan in any 12-month period.

§34-29-140(a)(3).

Any rebate requirements or restrictions on prepayment

penalties? Borrower has right to prepay in full and

is entitled to Rule of 78s rebate (sum of the bal-

ances method), but if loan is renewed or renanced

during the rst 90 days, refund shall be pro rata.

§34-29-140(c).

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Lender

may not make purchase money mortgage loan, but

may make non-purchase money loan secured by

primary or secondary lien on real estate. §34-29-

140(h). See also §§37-22-110, 37-22-120 (because it is

a security interest on real estate, restricted lender is

required to have mortgage lending license as well).

Liens on household furniture are restricted but not

prohibited. §34-29-150(e).

Does statute prohibit unconscionable loan charges? Yes.

§37-5-108(6).

Must lender underwrite or evaluate borrower’s ability to

repay? No separate requirement, but must consider to

determine if unconscionable. §37-5-108(4)(b).

Is lending under this statute exempt from state criminal

usury law? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report giving information on licens-

ee’s nancial condition, balance sheets, income and

expenses; a reconciliation of surplus with the balance

sheets; a schedule of assets; an analysis of charges,

size of loans and types of actions undertaken to effect

collection; and such other relevant information as

the board may prescribe. Report must also include:

number of loans and aggregate dollar amounts

which renewed existing accounts, which were made

to former borrowers, and which were made to new

borrowers; number of loans and aggregate dollar

amounts which received a nal entry other than by

renewal; number of renewals in which the borrower

received a cash advance which was less than ten per-

cent of the net outstanding loan balance at the time of

renewal; and number of loans and aggregate dollar

amounts outstanding at beginning and end of report-

ing period. Board shall publish annual analysis and

recapitulation. §34-29-100.

Other signicant features: Loan-splitting prohibited.

§34-29-140(d). Anti-evasion provision. §34-29-20(a).

SOUTH DAKOTA

S.D. Codiﬁed Laws §§ 54-4-36 to 54-4-75

(Money Lenders Licenses).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Any person engaged in the business of lend-

ing money. §54-4-40. Statute exempts banks and their

subsidiaries, South Dakota chartered trust compa-

nies, and retail installment sellers. §§54-4-37, 54-4-64.

Licensure requirements and implications of licensure: No

person may engage in the business of lending money

(dened by §54-4-36(2) to include originating, sell-

ing, servicing, acquiring, or purchasing loans, or

servicing, acquiring, or purchasing retail installment

loans) without a license. §§54-4-40, 54-4-52.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: “Short-

term consumer loan” is dened as any loan to any

individual borrower with a duration of six months or

less, including a payday loan. §54-4-36(13). “Install-

ment loan” is a loan made to be repaid in specied

amounts over a certain number of months. §54-4-

36(7). The maximum principal amount of any payday

loan, or the total outstanding principal balances of

all payday loans made by a licensee to a single bor-

rower, may not exceed $500 at any time. §54-4-66.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? Licensee may charge

interest and other fees at rates, amounts, and terms as

agreed to by the parties. §54-4-44. See also §§54-3-13,

54-3-14 (regulated lenders, including installment loan

licensees, are exempt from all limitations on interest

rates they may charge).

What loan fees are allowed? See preceding entry.

What types of insurance are allowed, and any limits the

lending statute places on charges? Property insurance

on tangible property that is collateral. §54-4-59.

Debt cancellation or suspension contracts. §54-4-75.

Statute also provides that a licensee may sell insur-

ance to anyone with whom the licensee has a lending

relationship, and requires that credit life insurance or

any other life or health insurance must be voluntary.

§54-4-60.

Does statute prohibit all other fees besides those specically

allowed? Statute is silent.

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent.

Any restrictions on renancing? No licensee may

renew, rollover, or ip a short-term consumer loan

more than four times; each time, the debtor must

reduce the principal amount of the loan by not less

than ten percent of the original amount of the loan.

§54-4-65.

Any rebate requirements or restrictions on prepayment

penalties? Statute is silent.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? “Loan” is

dened to include unsecured loans and loans secured

by real or personal property. §54-4-11.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: Not applicable.

TENNESSEE

Tenn. Code Ann. §§ 45-5-101 to 45-5-612

(Industrial Loan and Thrift Companies).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Industrial loan and thrift companies,

industrial banks, industrial investment companies.

§45-5-103(a). Law is inapplicable to banks (other

than industrial banks), savings and loan associations,

credit unions, insurance companies, any other per-

sons engaged in the business of making loans who

are subject to supervision and regulation by a state or

federal administrative agency, and licensed pawnbro-

kers. §45-5-104.

Licensure requirements and implications of licensure: Reg-

istration required. §45-5-103(a).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: For loan

$300 or less, loan term may not exceed 24 months; for

loan of more than $300 but less than $1,000, may not

exceed 36 months; for loan of $1,000 or more that is

subject to chapter’s limitations on interest and loan

charges, may not exceed 181 months. §45-5-302(2).

The minimum term of any loan made under the alter-

native rate structure described in §45-5-403(b)(1) is 3

months, and the maximum term is 25 months. §45-5-

403(b)(2).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed?



On loan of less than $100, 7.5% per annum discount

interest, but capped at 18% actuarial. On loan of

$100 or more, 24% actuarial. §§45-5-301, 45-5-401(a)

(1).



As an alternative to the loan charges permitted

under §45-5-403(a) and interest permitted under

§45-5-301, for loan with term of at least 3 months

but no more than 25 months, lender may charge

an acquisition charge of 10% of principal plus and

account handling charge of:



$12 per month for loan of $100 or more but no

more than $300;



$14 per month for loan over $300 but no more

than $400;



$16 per month for loan over $400 but no more

than $500;



$20 per month for loan over $500 but no more

than $1,000;



$23 per month for loan over $1,000 but no more

than $1,250;



$26 per month for loan over $1,250 but no more

than $1,500;



$29 per month for loan over $1,500 but no more

than $1,750;



$32 per month for loan over $1,750 but no more

than $2,000.



No insurance or other charge is allowed for a loan

under this section except late charges, dishonored

check charges, and attorney fees for collection.

§45-5-403(b)(1), (4).

What loan fees are allowed?



4% of loan amount or a at service charge of $10

(less if loan is under $100). §45-5-403(a)(1), (2).



In addition:



Recording fees or non-ling insurance if no more

than those fees;



Installment maintenance fee of $2.50 per month

for loan of less than $100, $3.50 per month for

loan of $100 or more but no more than $750, $3.00

per month for loan of more than $750 but no

more than $1,250, and $2.50 per month for loan

over $1,250.

§ 45-5-403(a). These fees are not permitted for loans

under alternative rate structure. §45-5-403(b)(1), (4).

A general provision of the statute provides that these

loan charges can be imposed only if the loan term is

at least three years. §45-5-301(3).

What types of insurance are allowed, and any limits the

lending statute places on charges? Property insurance

on the collateral; life, disability, and involuntary

unemployment insurance; individual term life and

accidental death and dismemberment insurance.

§§45-5-301(4), (5), (12), 45-5-305. No insurance

allowed on loans under alternative rate structure in

§45-5-403(b)(1). §45-5-403(b)(4).

Does statute prohibit all other fees besides those specically

allowed? Yes. §45-5-403(a).

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent.

Any restrictions on renancing? The at service charges

authorized by §45-5-403(a)(2) ($2 to $10) cannot be

charged on the portion of a loan that renances an

earlier loan. §45-5-403(a)(2)(C).

Any rebate requirements or restrictions on prepayment

penalties? If borrower prepays loan of less than $100,

entitled to actuarial rebate, with special calculation

method if loan was repayable in single installment.

Borrower has right to prepay loan of $100 or more

only if contract so provides. §45-5-402(b)(1). If lender

allows borrower to prepay loan of $100 or more, bor-

rower is entitled to Rule of 78s rebate (sum of the

balances method), unless loan term is 61 months or

more, in which case actuarial rebate is required. No

rebate required if less than $1. §45-5-402(a)(2), (b)(2)

(C). On the prepayment of any loan under the alter-

native rate structure described in §45-5-403(b)(1), the

installment account handling charges are subject to

rebate under §45-5-402. §45-5-403(b)(3).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Loans may be

unsecured or secured by real or personal property.

§45-5-301(1).

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report stating names and addresses

of registrant’s ofcers and directors or partners,

and persons owning controlling interest in regis-

trant; registrant’s business locations and the nature

of the business conducted at each location; names

and addresses of all afliated lenders and afliated

insurance companies doing business in the state; and

balance sheets, statements of income and expense,

summaries of types of loans made, and other statis-

tical information that may reasonably be required

by the commissioner. Commissioner must prepare

annual analysis and recapitulation of the reports.

§45-5-503. Registrants must also report certain events

such as bankruptcy, revocation or suspension pro-

ceedings, and indictments or convictions. §45-5-507.

Other signicant features: Loan-splitting prohibited.

§45-5-302(11).

TEXAS

Tex. Fin. Code Ann. §§ 342.051 to 342.560

(West) (Consumer Loans).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applies to all lenders, but exempts some from

licensure requirement.

Licensure requirements and implications of licensure:

Must hold a license to engage in business of making,

transacting, negotiating, collecting, or servicing

loans subject to the chapter, or to charge interest

greater than that otherwise authorized. Banks, sav-

ings banks, savings and loan associations, insurance

premium nance companies, insurance agents who

arrange loans on behalf of banks, savings banks, or

savings and loan associations, e-lers authorized

by IRS who arrange refund anticipation loans, and

certain licensed or registered mortgage lenders and

originators (limited to home equity and secondary

mortgage loans) need not be licensed. §342.051.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: For loans

made under the add-on rates allowed by §342.201(a)

or the split rates allowed by §342.201(e), loan term

cannot exceed:



37 months if loan is for $1,500 or less.



49 months if loan is for more than $1,500 but no

more than $3,000.



60 months if loan is for more than $3,000.

§ 342.508.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute applies to loans for consumer purposes, other

than certain mortgage loans, if interest rate exceeds

10%. §342.005.

What rate of interest is allowed?

For loan not secured by real property, three

alternatives:



Add-on interest of:



$18 per $100 per year on rst $2,010 (adjusted for

ination from original amount of $300); and;



$8 per $100 per year on amount over $2,010 but

no more than $16,750 (adjusted for ination from

original amount of $2,500). §342.201(a).



The simple interest rates set by §§303.001 to

303.017 (twice the rate on certain Treasury bills,

with a cap ranging from 18% to 24% for consumer

loans). §§342.201(d), 303.009.



Split simple interest rates (referred to in Texas

as “graduated rates” or “three-tiered rates”) as

follows:



30% on rst $3,350 (adjusted for ination from

original amount of $500);



24% on amount greater than $3,350 but no more

than $7,035 (adjusted for ination from original

amount of $1,050); and



18% on amount greater than $3,350 but no more

than $16,750 (adjusted for ination from $2,500).

§342.201(e).

See next summary for loans under subchapter F

(Alternate Charges for Certain Loans), applicable to

loans of $1,340 or less.

What loan fees are allowed? Administrative fee of $100.

§342.201(f); 7 Tex. Admin. Code §83.503 (increasing

the fee to $100, effective July 10, 2014, and stating that

it may be charged in addition to interest). Recording

fees or non-ling insurance if less than those fees.

§§342.416, 342.502(b).

What types of insurance are allowed, and any limits the

lending statute places on charges? Lender may require

property insurance on tangible personal property

collateral for non-real property loan, but only if cash

advance is $300 or more. §342.401. If cash advance

is $100 or more, lender may offer credit life, credit

health and accident, and involuntary unemployment

insurance. §342.402. For loan that is not secured by

real property and for which the nance charges are

computed under the simple interest rates (18% to

24%) allowed by §342.201(d), lender may offer, but

not require, a debt suspension agreement or debt can-

cellation agreement, and, if a motor vehicle is collat-

eral, a gap waiver agreement. §342.4021. Authorized

lender (a bank, savings association, or licensed con-

sumer lender) may offer, but not require, an automo-

bile club membership. §342.457.

Does statute prohibit all other fees besides those specically

allowed? Yes. §342.502.

Does statute restrict balloon payments or irregular pay-

ment schedules? No. Statute refers to single-payment

loans and irregular transactions. §§342.201(c),

342.202. See also §342.001(1), (2) (denitions of irregu-

lar and regular transactions).

Any restrictions on renancing? Administrative fee

($100) can be charged only once in any 180-day

period, and only once in any 365-day period if lender

charged the split simple interest rates allowed by

§342.201(e). §342.201(f).

Any rebate requirements or restrictions on prepayment

penalties? Lender must allow prepayment. §342.453.

Rebate is to be calculated using the “scheduled

installment method,” which involves applying a

daily rate to the unpaid balance of the principal

amount as if each payment will be made on its

scheduled installment date. No refund is required

if amount is less than $1. §§342.002(a), 342.351 to

342.353. See also 7 Tex. Admin. Code §§83.751 (pro-

hibiting Rule of 78s for loans under this subchapter),

83.752 (identifying the fees that are subject to rebate),

83.753 (reiterating computation method). Prepayment

penalties are prohibited on all chapter 342 consumer

loans because they are not specically authorized by

§342.502.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Wage assign-

ments and liens on real property, other than judg-

ment liens, are prohibited, but lender may take an

assignment of a warrant drawn against a state fund

or a claim against a state fund or a state agency.

§342.503.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability

to repay? Statute is silent, but administrative rule

requires lenders making loans under chapter 342

to consider, in determining the size, duration, and

schedule of installments, the nancial ability of the

borrower to repay the loan, and evaluate whether the

borrower should be reasonably able to repay all other

known obligations concurrently. 7 Tex. Admin. Code

§83.852.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what

must be reported and whether there are any requirements

that the state agency review or take other steps regard-

ing the reports: Authorized lender (a bank, savings

association, or licensed consumer lender) must le

annual report containing information required by the

commissioner. Commissioner shall publish annual

consolidated analysis and recapitulation. §342.559.

However, 7 Tex. Admin. Code §83.835 limits the

annual reporting requirement to licensees of the

Ofce of the Consumer Credit Commissioner, so it

does not apply to banks, savings banks, savings and

loan associations, or other lenders that need not be

licensed.

Other signicant features: Loan splitting prohibited.

§342.501. Anti-evasion provision. §342.051(b).

Tex. Fin. Code Ann. §§ 342.251 to 342.260

(West) (Subchapter F: Alternate Charges for

Certain Loans).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Applies to all lenders, but exempts some from

licensure requirement.

Licensure requirements and implications of licensure:

Must hold a license to engage in business of making,

transacting, negotiating, collecting, or servicing

loans subject to the chapter, or to charge interest

greater than that otherwise authorized. Banks, sav-

ings banks, savings and loan associations, insurance

premium nance companies, insurance agents who

arrange loans on behalf of banks, savings banks, or

savings and loan associations, e-lers authorized

by IRS who arrange refund anticipation loans, and

certain licensed or registered mortgage lenders and

originators (limited to home equity and secondary

mortgage loans) need not be licensed. §342.051.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Allows

loans of $1,340 or less (adjusted for ination from

$200). §342.251. Maximum scheduled loan term for a

loan of $100 or less is one month for each multiple of

$10 of the cash advance or six months, whichever is

less; for a loan of more than $100, one month for each

multiple of $20. §342.255.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute applies to loans for consumer purposes, other

than certain mortgage loans, if interest rate exceeds

10%. §342.005.

What rate of interest is allowed?



For loan of less than $30, $1.00 acquisition charge

for each $5 advanced.



For loan of at least $30 but no more than $100,

acquisition charge of 10% of the cash advance,

plus account handling fee of $3.00 a month if cash

advance is $35.00 or less, $3.50 a month if cash

advance is more than $35.00 but no more than

$70.00, and $4.00 a month if cash advance is more

than $70.00.



For loan of more than $100 but no more than $1,340

(adjusted for ination from $100 and $200), acqui-

sition charge of $10, or, if cash advance is $30 or

more, 10% of the cash advance or $100, whichever

is less; plus account handling fee of $4 a month for

each $100 advanced.

§§ 342.251, 342.252, 342.259. 7 Tex. Admin.

Code §83.605.

What loan fees are allowed? No additional fees are

allowed. §342.254.

What types of insurance are allowed, and any limits the

lending statute places on charges? No insurance charges

are authorized. §342.254.

Does statute prohibit all other fees besides those specically

allowed? Yes. §342.254.

Does statute restrict balloon payments or require substan-

tially equal installments? No. Lender may make single-

payment loan. §342.253. May also require weekly,

biweekly, or semimonthly installments. §342.258.

Any restrictions on renancing? Lender may not collect

acquisition charge more than once a month. 7 Tex.

Admin. Code §83.605.

Any rebate requirements or restrictions on prepay-

ment penalties? Upon prepayment of loan of $30 or

more, lender must make rebate of account handling

charge, calculated using the Rule of 78s. No refund

is required if amount is less than $1. §§342.256,

342.259(b) (incorporating §§342.351 to 342.353). See

also 7 Tex. Admin. Code §§83.751(b)(1) (allowing

Rule of 78s for loans under this subchapter), 83.755

(identifying fees that are subject to rebate). Prepay-

ment penalties are prohibited on all chapter 342

consumer loans because they are not specically

authorized by §342.502.

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Wage

assignments and liens on real property, other than

judgment liens, are prohibited, but lender may take

an assignment of a warrant drawn against a state

fund or a claim against a state fund or a state agency.

§342.503.

Does statute prohibit unconscionable loan charges? No.

Must lender underwrite or evaluate borrower’s ability

to repay? Statute is silent, but administrative rule

requires lenders making loans under chapter 342

to consider, in determining the size, duration, and

schedule of installments, the nancial ability of the

borrower to repay the loan, and evaluate whether the

borrower should be reasonably able to repay all other

known obligations concurrently. 7 Tex. Admin. Code

§83.852.

Is lending under this statute exempt from state criminal

usury law? Not applicable.

Reporting requirements, including detail about what

must be reported and whether there are any requirements

that the state agency review or take other steps regard-

ing the reports: Authorized lender (a bank, savings

association, or licensed consumer lender) must le

annual report containing information required by the

commissioner. Commissioner shall publish annual

consolidated analysis and recapitulation. §342.559.

However, 7 Tex. Admin. Code §83.835 limits the

annual reporting requirement to licensees of the

Ofce of the Consumer Credit Commissioner, so it

does not apply to banks, savings banks, savings and

loan associations, or other lenders that need not be

licensed.

Other signicant features: Loan splitting prohibited.

§342.501. Anti-evasion provision. §342.051(b).

UTAH

Utah Code Ann. §§ 70C-1-101 to 70C-8-203

(West) (Consumer Credit Code).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Applies generally to extensions of credit,

broadly dened, to natural persons for consumer

purposes, but excludes:



Business, commercial, or agricultural credit.



Closed-end credit secured by a rst lien on a dwell-

ing or building lot.



Certain transactions in securities or commodities

accounts.



Credit over $50,000 (adjusted for ination), unless

secured by real property or a personal-property

dwelling.



Certain transactions under public utility or

common carrier tariffs.



Most insurance sales.



Licensed pawnbrokers.



Certain educational loans.



Rent-to-own transactions.

§§ 70C-1-201, 70C-1-202.

Licensure requirements and implications of licensure:

Licensure is not required, but creditors subject to the

Code, other than federally insured depository insti-

tutions and their wholly-owned subsidiaries, must

le notication with the department at least 30 days

before commencing business in the state. §70C-8-202.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Law does

not apply to extension of credit that is not secured

by the consumer’s principal dwelling and in which

the amount nanced or credit limit exceeds $50,000

(adjusted annually for ination). §70C-1-202.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? Any rate set by con-

tract. §70C-2-101.

What loan fees are allowed? Any charges and fees other

than those restricted or covered by other provisions

of the Code. §70C-2-101.

What types of insurance are allowed, and any limits the

lending statute places on charges? Except as otherwise

provided in statute, a creditor may agree to provide

insurance. Statute specically mentions property

insurance on collateral, credit life insurance, and lia-

bility insurance. §§70C-6-103, 70C-1-204, 70C-6-202,

70C-6-303.

Does statute prohibit all other fees besides those specically

allowed? Debtor is not required to pay any charge in

excess of those allowed by the Code. §70C-7-201.

Does statute restrict balloon payments or require substan-

tially equal installments? Debtor has right to renance

balloon payment on creditor’s current credit terms if

the creditor is still offering that type of credit and the

debtor is credit worthy. §70C-3-102.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Debtor may prepay closed-end consumer

credit debt at any time without penalty, with excep-

tion for certain loans secured by a dwelling. Rebate

method is actuarial, but parties may agree that pre-

paid nances charges up to 5% of principal are not

subject to rebate upon prepayment; prepaid nance

charges over that amount must be rebated using pro

rata method. Amounts paid to third parties in con-

nection with setting up the credit are not subject to

rebate unless the creditor becomes entitled to a rebate

of any part of the payment as a result of the prepay-

ment. §70C-3-101.

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Wage

assignments prohibited unless revocable, or a payroll

deduction plan, or applicable only to wages already

earned at the time of the assignment. §70C-2-202.

Does statute prohibit unconscionable loan charges? Yes.

§70C-7-106.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Criminal usury statute, §76-6-520, applies

only where lender charges rate higher than that

authorized by other law.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Statute is silent.

Other signicant features: Not applicable.

VERMONT

Vt. Stat. Ann. tit. 8, §§ 2200 to 2244 (Licensed

Lenders Act).

What types of lenders does it apply to (e.g., banks vs.

non-banks)? Most of the relevant provisions apply to

licensed lenders. §2201(a)

Licensure requirements and implications of licensure:

Must have license to engage in business of making

loans, except for:



Political subdivisions of the state, or state or federal

agencies or public instrumentalities.



Gas or electric utilities subject to jurisdiction of the

public service board engaging in energy conserva-

tion or safety loans.



Depository institutions and similar organizations.



Pawnbrokers.



Insurance companies.



Sellers that nance sales of goods or services.



Certain low-volume seller/nancers of homes.



Certain non-prot lenders.



Low-volume lenders who charge no more than 12%

interest.



Motor vehicle sellers who nance negative equity

in some circumstances.



Certain unsecured commercial loans.



Nonprot organizations that make college loans.



Mortgage loans with family members.



Housing nance agencies.

§ 2201. Loan made without required license is void.

§2215(d)(1).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute

does not apply to commercial loans of $1 million or

more. §2201(h).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? For installment loan,

24% on rst $1,000 and 12% on remainder, or 18%,

whichever is higher. §2230(a) (incorporating tit. 9,

§41a(b)(5)). For single payment loans, 18%. tit. 9,

§41a(b)(1).

What loan fees are allowed? Recording fees. §2231.

What types of insurance are allowed, and any limits the

lending statute places on charges? Credit life and dis-

ability insurance. §2231. In addition, §2241(13) refers

to property insurance.

Does statute prohibit all other fees besides those specically

allowed? Yes. §§2231(b), 2233.

Does statute restrict balloon payments or irregular pay-

ment schedules? Except for mortgage loans, must

require repayment in substantially equal consecutive

monthly installments. §2231(a).

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Borrower may prepay in any amount at any

time without penalty. §2232a(d).

What security interests are allowed or prohibited (includ-

ing postdated checks and ACH authorization)? Wage

assignments are limited to 10% of wages but are not

prohibited. §2235.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

Is lending under this statute exempt from state criminal

usury law? Criminal usury statute, Vt. Stat. Ann. tit. 9,

§50(e), prohibits collecting interest at rate over that

authorized by other law.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report giving such relevant informa-

tion as the Commissioner reasonably may require;

annual nancial statement with balance sheet and

income statement. Commissioner shall publish

annual analysis and recapitulation. §2224.

Other signicant features: Loan splitting prohibited.

§2230(c). Wage assignment is treated as a loan.

§2234.

VIRGINIA

Va. Code Ann. §§ 6.2-1500 to 6.2-1543

(Consumer Finance Companies).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Does not apply to banks, savings institutions,

trust companies, building and loan associations,

industrial loan associations, credit unions, licensed

pawnbrokers, or persons operating in accordance

with the specic provisions of any other provision of

title 6.2, which includes provisions regarding vehicle

title lenders, payday lenders, and mortgage lenders.

§6.2-1503.

Licensure requirements and implications of licensure:

Must have license to make loans to individuals for

consumer purposes at interest rate greater than

allowed by general usury law (12%). License require-

ment does not apply to payday lenders, mortgage

lenders, and those extending open-end loans. §6.2-

1501. Banks, savings institutions, trust companies,

building and loan associations, industrial loan asso-

ciations, and credit unions are ineligible for licensure,

but a subsidiary of a bank or savings institution may

obtain a license. §6.2-1502. Loan made without a

required license is void. §6.2-1541.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute is

silent.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed?



Loan of up to $2,500: 36%.



More than $2,500: any rate stated in contract.

§ 6.2-1520(A).

What loan fees are allowed? Processing fee, but for

a loan of $2,500 or less it is treated as interest for

determining whether loan is within the 36% cap;

recording fees, or, on loans over $100, the premium

for non-ling insurance if no more than that amount.

§§6.2-1520(C), 6.2-1523.

What types of insurance are allowed, and any limits the

lending statute places on charges? Insurance for the

protection and benet of the borrower; for loans over

$100, non-ling insurance. §6.2-1523.

Does statute prohibit all other fees besides those specically

allowed? Yes. §6.2-1523.

Does statute restrict balloon payments or irregular pay-

ment schedules? Loan contract must provide for

repayment in substantially equal monthly install-

ments, but rst payment period can be up to 45 days.

§6.2-1524(K).

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Prepayment allowed. §6.2-1524(F). Pre-

payment penalties impliedly prohibited because not

authorized by §6-2-1523. A general lending statute,

§6.2-404, applicable to “any loan of money,” pro-

vides that rebates to be calculated using the Rule of

78s unless the loan has an initial maturity of more

than 61 months. However, provides: “The annual

rate of interest shall be charged only upon princi-

pal balances outstanding from time to time. Interest

shall not be charged on an add-on basis and shall

not be compounded or paid, deducted or received in

advance,” so interest cannot be precomputed and a

the Rule of 78s rebate provision is irrelevant.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Lien on real

estate, other than judgment lien, is prohibited and

void. §6.2-1524(C). Wage assignments are limited to

10% of the borrower’s salary, wages, commissions

or other compensation for services, but are not pro-

hibited. §6.2-1526. Liens on household furniture are

regulated but not prohibited. §6.2-1527.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report giving such relevant informa-

tion as may reasonably be required. §6.2-1534.

Other signicant features: Wage assignment is treated

as security for a loan, and implicit interest rate shall

not exceed 10% . §6.2-1525. Anti-evasion provision.

§6.2-1501.

WASHINGTON

Wash Rev. Code §§ 31.04.015 to 34.04.903

(Consumer Loan Act).

What types of lenders does it apply to (e.g., banks vs. non-

banks)?

Applies to loans, broadly dened, but excludes:



Banks, savings banks, trust companies, savings and

loan or building and loan associations, and credit

unions.



Pawnbrokers.



Retail installment sellers, unless credit is extended

to purchase merchandise certicates, coupons,

open or closed loop stored value, or other similar

items issued and redeemable by a retail seller other

than the retail seller extending the credit.



Entities making loans under check cashers law.



Business, commercial, or agricultural loans unless

secured by borrower’s primary residence.



“Any person making loans made to government

or government agencies or instrumentalities or

making loans to organizations as dened in the fed-

eral truth in lending act.”



Entities making loans under housing trust fund law

or HUD, USDA, or similar federal programs



Loans made by nonprot housing organizations or

under federal- or state-funded low-income housing

programs.



“Entities making loans that are not residential

mortgage loans under a credit card plan.”



Individuals employed by a licensed residential loan

servicing company, unless so required by federal

law or regulation.



Licensed entities that process payments on seller-

nanced loans secured by liens on real or personal

property.

§ 31.04.025.

Licensure requirements and implications of licensure:

License required. If non-mortgage loan is made

without a required license, fees, or interest must be

refunded. §31.04.035(1).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute is

silent.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? 25%. §31.04.105(1).

What loan fees are allowed?



Nonrefundable, prepaid, origination fee not to

exceed 4% of the rst $20,000 and 2% of remainder.

§31.04.105(2).



Actual fees paid to third parties who provide goods

or services, including credit reporting agencies, title

companies, appraisers, structural and pest inspec-

tors, and escrow companies. No fees other than

appraisal fees meeting statutory requirements may

be collected unless a loan is made. §31.04.105(3).

See also Wash. Admin. Code §§208-620-555, 208-620-

560 (providing details about fees).

What types of insurance are allowed, and any limits the

lending statute places on charges? Licensee may sell

insurance covering real and personal property, cov-

ering the life or disability or both of borrower, and

covering the involuntary unemployment of borrower.

§31.04.105(10).

Does statute prohibit all other fees besides those specically

allowed? Statute is silent.

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Actuarial rebate required. §31.04.125.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Statute is

silent.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent.

Must lender underwrite or evaluate borrower’s ability

to repay? Statute is silent, and administrative code,

Wash. Admin. Code §208-620-506, which requires

that underwriting standards include analysis of abil-

ity to repay, applies only to mortgage lending.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what

must be reported and whether there are any requirements

that the state agency review or take other steps regarding

the reports: Annual report with information as direc-

tor may reasonably require. Director shall publish

annual analysis and recapitulation §31.04.155.

Other signicant features: Not applicable.

WEST VIRGINIA

W. Va. Code §§ 46A-1-101 to 46A-8-102

(Consumer Credit and Protection Act).

What types of lenders does it apply to (e.g., banks vs.

non-banks)?

Applies generally to consumer lending, but

excludes:



Extensions of credit to government or governmen-

tal agencies or instrumentalities.



Sale of insurance by an insurer, except as otherwise

provided.



Certain transactions under public utility or

common carrier tariffs.



Licensed pawnbrokers.



Mortgage lender and broker licensees, to the extent

of a conict with certain other laws.

§§ 46A-1-103, 46A-1-105.

Licensure requirements and implications of licensure:

Must obtain license in order to make regulated con-

sumer loans (dened by §46A-1-102(38) as loans at

more than 18% except those that qualify for federal

preemption of state interest rate limits or where

another state law authorizes the interest rate) or take

assignments of and undertake collection of them.

§46A-4-101. Loan made without a required license is

void. §46A-5-101(2).

Size and length of loans to which the statute applies,

and any restrictions in the statute on these features:

“Consumer loan” is dened as one where either

the principal does not exceed $45,000 or the debt is

secured by an interest in land or a factory-built home.

§46A-1-102(15).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed?



For loan of $2,000 or less by regulated lender that is

not secured by real property, 31% actuarial.



For loan by regulated lender of greater than $2,000

or which is secured by real property, 27% actuarial,

but 18% if loan exceeds $10,000. §46A-4-107.



In the alternative, any lender may charge 6%

add-on interest, or 6% discount interest (capped

at 15% actuarial). §46A-3-104(1) (incorporating

§47-6-5a).



As an additional alternative, lender may charge 1

percent in excess of federal discount rate. §31A-4-

30a (made applicable to non-bank lenders by

§46A-3-117).



As a nal alternative, any lender may charge 18%

actuarial, by virtue of a board order under §§47A-

1-1 to 47A-1-4.

Lender may charge minimum nance charge of $5.00

if amount loaned does not exceed $75.00, or $7.50 if

amount loaned exceeds $75.00. §46A-3-104(4).

What loan fees are allowed? Regulated lender may

charge 2% of the amount nanced as an origination

fee, points or investigation fee (5% if loan is secured

by real estate), but this fee plus interest must fall

within the caps set by §46A-4-107(4). Lender may

also charge:



Ofcial fees (dened by §46A-1-102(28) as record-

ing fees or non-ling insurance premiums if no

more than those fees) and taxes.



Charges for other benets, including insurance,

conferred on the consumer, if the benets are of

value, the charges are reasonable and of a type

which is not for credit, and are excluded as permis-

sible additional charges from the nance charge by

rule adopted by the commissioner



Documentary charge if reasonable in amount and

applied equally to cash and credit customers.

§§ 46A-3-109(a); 46A-4-107(4).

What types of insurance are allowed, and any limits the

lending statute places on charges? Insurance on life and

earning capacity of any consumer obligor; property

insurance on collateral; vendor’s or creditor’s single

interest insurance with respect to which the insurer

has no right of subrogation. §46A-3-109(b).

Does statute prohibit all other fees besides those specically

allowed? Yes, for regulated lenders. §46A-4-107(4).

Does statute restrict balloon payments or irregular pay-

ment schedules? For closed-end non-agricultural

consumer loan of less than $1,500, consumer has

right to renance any balloon payment without

penalty, unless payment schedule was adjusted for

seasonal or irregular income. §46A-2-105. Balloon

payments prohibited in loans by regulated lender

unless preempted by federal law. Payment schedule

that produces negative amortization is prohibited.

§46A-4-110a(2).

Any restrictions on renancing? Only provision relates

solely to loans secured by real estate. §46A-4-107(4).

Any rebate requirements or restrictions on prepayment

penalties? Consumer may prepay in full at any time

without penalty, with exception for certain loans

secured by land. §46A-3-110. Rule of 78s rebate (sum

of the balances method) required upon prepayment

in full if loan term is 36 months or less; otherwise,

actuarial method. No rebate if less than $1.00, and

for loan not secured by real property lender may

retain prepaid nance charges up to 2% of amount

nanced. §46A-3-111(2) (incorporating §47-6-5d).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Wage assign-

ments are allowed but are revocable and limited

to 25% of disposable earnings, and are prohibited

altogether and void for regulated consumer lend-

ers. §§46A-2-116, 46A-4-109(2). Regulated consumer

lender may not take non-purchase money security

interest in household goods in the possession and

use of the borrower; for items other than household

goods, security interest is allowed but regulated.

§46A-4-109(3).

Does statute prohibit unconscionable loan charges? Yes.

§46A-2-121.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Criminal usury provision,

§46A-5-103, only criminalizes certain violations of

the Consumer Credit and Protection Act, so does not

provide an independent limit on the rates the Act

authorizes.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Annual report in form prescribed by commis-

sioner relating to all regulated consumer loans made

and showing in detail the actual nancial condition

and the amount of the assets and liabilities of such

nancial institution. §46A-4-104.

Other signicant features: Loan-splitting prohibited.

§46A-4-108.

WISCONSIN

Wis. Stat. § 138.09 (Licensed Lenders).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Does not apply to banks, savings banks, sav-

ings and loan associations, trust companies, credit

unions, or any of their afliates, or to payday loans.

§138.09(1a).

Licensure requirements and implications of licensure:

Must obtain license to do business under provision,

charge interest authorized by provision, or assess

nance charge on consumer loan over 18% per year.

§138.09(1m)(a).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Term of

loan that is scheduled to be repaid in substantially

equal installments at equal periodic intervals may

not exceed 24 months and 15 days if loan is for $700

or less, or 36 months and 15 days if loan is for more

than $700 but no more than $3,000. §138.09(7)(d)(1).

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? A loan made after

October 31, 1984, is not subject to any maximum

interest rate limit. §138.09(7)(bp).

What loan fees are allowed?



Ofcial fees and taxes.



Other fees approved by administrator



Future service contracts or motor club service con-

tracts if certain conditions are met.



Mechanical breakdown, extended warranty or

maintenance service contracts or insurance.



The fee for ling a termination statement if loan is

secured by merchandise other than a motor vehicle,

a manufactured home, or a boat.

§ 138.09(7)(i) (specifying certain allowable charges

and incorporating §422.202).

What types of insurance are allowed, and any limits the

lending statute places on charges? Property insurance;

credit life insurance; credit accident and sickness

insurance. §138.09(7)(h).

Does statute prohibit all other fees besides those specically

allowed? Statute is silent.

Does statute restrict balloon payments or irregular pay-

ment schedules? Statute is silent.

Any restrictions on renancing? Only restriction

applies only to home-secured loans. §138.09(7)(jm).

Any rebate requirements or restrictions on prepayment

penalties? Borrower is entitled to prepay loan in

whole or part. §138.09(8)(c). Borrower is entitled to

Rule of 78s rebate upon prepayment in full of a loan

of less than $5,000 that is precomputed, payable in

substantially equal installments at approximately

equal intervals, and for term of less than 37 months;

otherwise, actuarial rebate, but lender may round

interest rate down to nearest .025% when calculating

the rebate. If combined rebate of interest and credit

insurance premiums is less than $1, no rebate need be

made. §§138.09(7)(gm)(3), (4), 422.209.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Statute refers

to real property, manufactured home, motor vehicle.

Does statute prohibit unconscionable loan charges? Stat-

ute is silent, but generally incorporates Wisconsin

Consumer Act, which prohibits unconscionability.

§139.08(7)(k).

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Criminal usury law, §943.27,

applies only where lender charges a rate that is pro-

hibited by some other law.

Reporting requirements, including detail about what

must be reported and whether there are any requirements

that the state agency review or take other steps regard-

ing the reports: Annual report giving reasonable and

relevant information that the division may require.

§138.09(3)(f).

Other signicant features: Loan splitting prohibited.

§138.09(7)(j). Anti-evasion provision. §138.09(9)(a).

Wis. Stat. §§ 421.101 to 427.105 (Wisconsin

Consumer Act).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Act applies broadly to consumer credit trans-

actions. §421.107. Does not apply to:



Extensions of credit to organizations.



Transactions in which all parties are organizations.



Certain transactions under public utility or

common carrier tariffs.



Pawnbrokers’ rates and charges.



Most sales of insurance.



Consumer credit transactions in which amount

nanced exceeds $25,000.



First lien real estate mortgage transactions.



Certain securities transactions.



Motor vehicle leases that do not meet denition of

consumer lease.



Transactions for agricultural purposes, except

for debt collection restrictions and a disclosure

provision.



For some purposes, certain consumer credit trans-

actions made, insured, or guaranteed by a govern-

ment agency.

§§ 421.202(1), 421.203

Licensure requirements and implications of licensure:

Registration requirement for those who make or

solicit consumer credit transactions (except a person

who engages in consumer credit transactions solely

through honoring credit cards issued by third parties

not related to such person), or who directly collect

payments from or enforce rights against customers

arising from such transactions. §426.201.

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Statute

is limited to loans of $25,000 or less. §421.202. For

closed-end loan other than one pursuant to §138.09

(see above), loan term is limited to: 25 months if total

of payments is $700 or less; 37 months if total of pay-

ments is more than $700, but does not exceed $1,400;

or 49 months if total of payments is more than $1,400,

but does not exceed $2,000, unless the transaction

is for the acquisition of or substantial improvement

to real property in which case such period shall not

exceed 61 months. Special rules for certain loans

for the purpose of an improvement to real property.

Exceptions for certain educational loans and loans

made by administrative agencies. §422.403.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed? No limit. §422.201(2)

(bn).

What loan fees are allowed? Ofcial fees (dened by

§421.301(26) as recording fees or non-ling insurance

if no more than those fees) and taxes. §422.202(1).

What types of insurance are allowed, and any limits the

lending statute places on charges? Credit life insur-

ance; credit accident and sickness insurance; credit

unemployment insurance; other insurance if certain

conditions are met; future service contracts or motor

club service contracts if certain conditions are met;

mechanical breakdown, extended warranty or main-

tenance service contracts or insurance; liability insur-

ance on collateral; property insurance on collateral,

but only if amount nanced is $800 or more and the

value of the property is $800 or more. §§422.202(2s),

424.301.

Does statute prohibit all other fees besides those specically

allowed? Statute is silent.

Does statute restrict balloon payments or irregular pay-

ment schedules? No. Provision requiring substantially

equal installments does not apply to loans made after

1984. §422.402(6).

Any restrictions on renancing? Minor restrictions.

§422.205.

Any rebate requirements or restrictions on prepayment

penalties? Borrower may prepay in full or part at any

time without penalty. §422.208. Upon prepayment in

full, borrower is entitled to Rule of 78s rebate (sum

of the balances method) if amount nanced was less

than $5,000 and initial term was less than 37 months;

otherwise, actuarial method required, but lender

may round interest rate down to nearest .025% when

calculating the rebate. If the total of all rebates is less

than $1, no rebate need be made. §422.209(1), (1m),

(2).

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Act does not

apply to transactions secured by a rst lien on real

estate. §421.202(7). Wage assignments are prohibited

unless revocable. §422.404. For a consumer loan,

lender may not take a non-purchase money security

interest in: (a) clothing of the customer and the cus-

tomer’s dependents and the following, if they are not

xtures: dining table and chairs, refrigerator, heating

stove, cooking stove, radio, beds and bedding, couch

and chairs, cooking utensils and kitchenware; or (b)

real property if the obligation secured is less than

$1,000. §422.417(3).

Does statute prohibit unconscionable loan charges? Yes.

§425.107.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? §943.27 criminalizes loan con-

tracts with interest exceeding 20% actuarial, but only

if the rate is prohibited by a law other than §943.27.

Reporting requirements, including detail about what

must be reported and whether there are any requirements

that the state agency review or take other steps regard-

ing the reports: Administrator must report annually

on practices in consumer transactions, on the use of

consumer credit in the state, on problems attending

the collection of debts, on the problems of persons of

limited means in consumer transactions, and on the

operation of the Act, including certain of the admin-

istrator’s policies and procedures and recommenda-

tions for amendments to the Act. The administrator

shall make available upon request a list of all persons

against whom complaints have been led and the

results of all investigations completed or not being

actively pursued along with a brief description of

the facts of each case and the action taken in each.

§426.104.

Other signicant features: Loan splitting prohibited.

§422.414.

WYOMING

Wyo. Stat. Ann. §§ 40-14-101 to 40-14-702

(Consumer Credit Code).

What types of lenders does it apply to (e.g., banks vs. non-

banks)? Act applies broadly to all creditors extend-

ing consumer credit including consumer loans, but,

except for loan originator licensing, excludes:



Extensions of credit to government or governmen-

tal agencies or instrumentalities.



The sale of insurance by an insurer if the premium

is not nanced.



Certain transactions under public utility or

common carrier tariffs.



Ceilings on rates and charges or limits on loan

maturities for credit unions.



Agricultural credit, for most purposes.

§ 40-14-121.

Licensure requirements and implications of licensure: To

make supervised loans, i.e., loans with interest rate

higher than 10%, or to take assignments of and col-

lect such loans (with 3-month grace period), must

have license or be a supervised nancial organization

(dened by §40-14-140(xix) as a depository institu-

tion, other than an insurer, that is subject to federal or

state supervision). §40-14-342. Loan made in viola-

tion of licensure requirements is void. §40-14-521(b).

Size and length of loans to which the statute applies, and

any restrictions in the statute on these features: Relevant

provisions apply to “consumer loans,” dened to

exclude those in which the principal exceeds $75,000,

unless the debt is secured by an interest in land or a

dwelling located in Wyoming, and to exclude most

rst mortgage loans if interest rate is 18% or less.

§§40-14-304, 40-14-305. Closed-end supervised loan

must be payable over no more than 25 months if the

principal is $300 or less, and over no more than 37

months if the principal is more than $300 but no more

than $1,000. §40-14-351.

Other restrictions on applicability of statute (e.g., it only

applies if lender takes a mortgage on real property): Stat-

ute is silent.

What rate of interest is allowed?



For consumer loan other than a supervised loan,

10%, but, except as provided for pawnbrokers

in §40-14-360(f) and post-dated check cashers in

§40-14-363, lender may charge a minimum loan

nance charge of $30.00. §40-14-310(a), (f).



For supervised loan with of $75,000 or less, either

36% on rst $1,000 and 21% on remainder, or 21%

on entire amount. Where principal exceeds $75,000,

any nance charge specied in loan agreement.

§40-14-348.

What loan fees are allowed?



Ofcial fees (dened by §40-14-140(a)(xi) as record-

ing fees or non-ling insurance premiums if no

more than those fees) and taxes.



Charges excluded from the loan nance charge by

the federal Consumer Credit Protection Act or by

rule adopted by the administrator.

§ 40-14-311.

What types of insurance are allowed, and any limits the

lending statute places on charges? Credit insurance pro-

viding life, accident, or health coverage; property and

liability insurance on property related to the credit

transaction. §§40-14-311(b), 40-14-450, 40-14-452.

Creditor may charge for property insurance only if

amount nanced is $300 or more and the value of the

property is $300.00 or more. §40-14-450.

Does statute prohibit all other fees besides those specically

allowed? Statute is silent.

Does statute restrict balloon payments or irregular pay-

ment schedules? For closed-end consumer loan, debtor

has right to renance any balloon payment on terms

at least as favorable as original terms, as long as cred-

itor is still offering that type of credit and the debtor

is creditworthy, except where payment schedule was

adjusted for seasonal or irregular income. §40-14-

333. Closed-end supervised loans of $1,000 or less

must be payable in substantially equal installments

at equal periodic intervals except to accommodate

debtor’s seasonal or irregular income. §40-14-351.

Any restrictions on renancing? Statute is silent.

Any rebate requirements or restrictions on prepayment

penalties? Debtor may prepay in full at any time with-

out penalty. §40-14-318. Rule of 78s rebate if original

loan term did not exceed 61 monthly installments;

otherwise, actuarial. No rebate required if less than

$1, and lender may retain minimum nance charge of

$30. §40-14-319.

What security interests (or postdated checks or ACH

authorizations) are allowed or prohibited? Wage assign-

ments prohibited and unenforceable for consumer

loans, but borrower may authorize deductions from

earnings if the authorization is revocable, and lender

may take an assignment of commissions or accounts

receivable payable to the debtor for services ren-

dered. §410-14-334. For a supervised loan where

principal is $1,000 or less, security interest in land is

prohibited and void. §40-14-350.

Does statute prohibit unconscionable loan charges? Yes.

§40-14-508.

Must lender underwrite or evaluate borrower’s ability to

repay? Statute is silent.

If state has a criminal usury law, is lending under this

statute exempt from it? Not applicable.

Reporting requirements, including detail about what must

be reported and whether there are any requirements that

the state agency review or take other steps regarding the

reports: Administrator must make annual report on

the operation of his ofce, on the use of consumer

credit in the state, and on the problems of persons of

small means obtaining credit from persons regularly

engaged in extending sales or loan credit. The report

shall include a description of certain of the admin-

istrator’s procedures and policies, the number and

percentages of ofces which are periodically investi-

gated or examined, a statement of the types of con-

sumer credit problems of creditors and debtors which

have come to his attention and their disposition, and

the activities of his ofce. Administrator may require

reports from lenders. §40-14-604(e), (h), (j).

Other signicant features: Loan splitting prohibited.

§40-14-349.