S 691 Session 109 (1991-1992)
S 0691 General Bill, By I.E. Lourie, Courson, H.U. Fielding, Giese, Saleeby,
H.S. Stilwell, Thomas, J.M. Waddell and M.B. Williams
A Bill to amend Section 34-29-140, Code of Laws of South Carolina, 1976,
relating to permitted charges and other terms and conditions of loans made
under the Consumer Finance Law, so as to revise finance charges and initial
charges on certain loans, and to provide that certain dollar amounts of this
Section must be adjusted for inflation in the same manner that adjustments for
inflation are made under the Consumer Protection Code, to amend Section
34-29-250, relating to criminal penalties for consumer finance law violations,
so as to authorize the Board of Financial Institutions to also assess civil
penalties for violations, and to repeal Section 34-29-230 relating to
regulatory provisions regarding particular persons engaged in the lending
business.
02/20/91 Senate Introduced and read first time SJ-5
02/20/91 Senate Referred to Committee on Banking and Insurance
A BILL
TO AMEND SECTION 34-29-140, CODE OF LAWS OF SOUTH
CAROLINA, 1976, RELATING TO PERMITTED CHARGES AND
OTHER TERMS AND CONDITIONS OF LOANS MADE UNDER
THE CONSUMER FINANCE LAW, SO AS TO REVISE FINANCE
CHARGES AND INITIAL CHARGES ON CERTAIN LOANS, AND
TO PROVIDE THAT CERTAIN DOLLAR AMOUNTS OF THIS
SECTION MUST BE ADJUSTED FOR INFLATION IN THE SAME
MANNER THAT ADJUSTMENTS FOR INFLATION ARE MADE
UNDER THE CONSUMER PROTECTION CODE, TO AMEND
SECTION 34-29-250, RELATING TO CRIMINAL PENALTIES FOR
CONSUMER FINANCE LAW VIOLATIONS, SO AS TO
AUTHORIZE THE BOARD OF FINANCIAL INSTITUTIONS TO
ALSO ASSESS CIVIL PENALTIES FOR VIOLATIONS, AND TO
REPEAL SECTION 34-29-230 RELATING TO REGULATORY
PROVISIONS REGARDING PARTICULAR PERSONS ENGAGED
IN THE LENDING BUSINESS.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Section 34-29-140(a) of the 1976 Code is amended to
read:
"(a) Maximum finance charges permitted; initial
charge.--A licensee under this chapter may lend any sum of
money not exceeding seventy-five hundred dollars, excluding charges,
and notwithstanding the fact that the loan may be repayable in
substantially equal monthly installments, may contract for and receive
finance charges not to exceed:
(1) Loans Not Exceeding One Hundred Fifty Dollars.--On
loans with a cash advance not exceeding one hundred fifty dollars, a
charge not to exceed two dollars and fifty cents per month if contracted
for in writing by the borrower, may be charged in lieu of interest, and
such loans may be repaid in weekly payments, with four weeks
constituting a month.
(2) Loans over one hundred fifty dollars but not exceeding
two thousand dollars.--On loans with a cash advance exceeding one
hundred fifty dollars but not exceeding one two
thousand dollars, twenty dollars per one hundred dollars on that portion
of the cash advance not exceeding one two hundred
dollars; eighteen dollars per one hundred dollars on that portion of the
cash advance exceeding one two hundred dollars but
not exceeding three six hundred dollars; and
eleven dollars per one hundred dollars on that portion of the cash
advance exceeding three six hundred dollars but not
exceeding five hundred one thousand dollars;
and nine dollars per one hundred dollars on that portion of the cash
advance exceeding five hundred one thousand dollars
but not exceeding one two thousand dollars, when the
loan is made payable over a period of one year, and proportionately at
those rates over a longer or shorter period of time.
In addition to the finance charges authorized in subparagraphs (1)
and (2) of this subsection (a), a licensee under this chapter may contract
for and receive an initial charge in such an amount as may be agreed
upon in writing with the borrower, but not to exceed seven percent of the
cash advance or twenty-eight fifty-six dollars,
whichever is the lesser, for the expenses, including but not limited to any
attorney's fees and broker's fees, then or theretofore incurred and the
services then or theretofore rendered by the lender incident to the loan
or the security therefor, such as investigating the moral and financial
standing of the borrower, investigating the security, title and similar
investigations and for closing the loan, including any and all expenses
incurred or services rendered at the request of the borrower or on his
behalf in connection with the loan. Such initial charge shall
may not be contracted for and received on any renewal loan or
other loan made to the same borrower more often than once in a three
months period; provided, however, that upon . Upon
any loan made to such the borrower of a sum in excess
of the amount on which such the initial charge may
have been charged within such the three-month period,
then such the initial charge may be contracted for and
received on such the excess. Such The
initial charge is a one-time charge, not a per annum charge, and
shall is not be subject to refund.
(3) Loans over One Two Thousand but Not
over Seventy-Five Hundred Dollars.--On loans with a cash advance
exceeding one two thousand dollars but not exceeding
seventy-five hundred dollars, the finance charges authorized in
subparagraphs (1) and (2) of this subsection (a) shall are
not be permitted on any part of the loan. On such loans a
licensee under this chapter may contract for and receive finance charges
not to exceed seven dollars per one hundred dollars of the cash advance,
when the loan is made payable over a period of one year, and
proportionately at that rate over a longer or shorter period.
In addition to the finance charges authorized in subparagraph (3) of
this subsection (a), a licensee under this chapter may contract for and
receive an initial charge in such an amount as may be agreed upon in
writing with the borrower, but not to exceed five percent of the cash
advance or two hundred dollars, whichever is lesser, for the expenses,
including but not limited to any attorney's fees and broker's fees, then or
theretofore incurred and the services then or theretofore rendered by the
lender incident to the loan or the security therefor, such as investigating
the morals and financial standing of the borrower, investigating the
security, title, and similar investigations and for closing the
loan, including any and all expenses incurred or services rendered at the
request of the borrower or on his behalf in connection with the loan.
Such The initial charge shall may not
be contracted for or received on any renewal loan made to the same
borrower more often than once in a twelve-month period; provided,
however, that upon. Upon any loan made to such
the borrower of a sum in excess of the amount on which
such the initial charge may have been charged within
such the twelve-month period, then such
the initial charge may be contracted for and received on
such the excess. If a loan is renewed or refinanced after
the expiration of the initial twelve-month period the initial charge may
not exceed two percent of the cash advance. The initial charge is a
one-time charge, not a per annum charge, and shall not
be is subject to refund."
SECTION 2. Section 34-29-140 of the 1976 Code is amended by
adding:
"(j) Change of Dollar Amounts.--The dollar amounts
provided in subsections (a)(2) and (a)(3) of this section shall change
from time to time in the manner provided by Section 37-1-109, except
that the index for December, 1991, is the Reference Base Index for
purposes of adjustments to the dollar amounts of this section. The
Chairman of the State Board of Financial Institutions shall have
has the same powers and duties in regard to the adjustments to
the dollar amounts of subsection (a)(2) of this section as does the
Administrator of the Department of Consumer Affairs with adjustments
to the dollar amounts required in Section 37-1-109."
SECTION 3. Section 34-29-250 of the 1976 Code is amended to read:
"Section 34-29-250. Any person who wilfully violates any
provision of this chapter, for which a penalty has not been provided,
shall be deemed is guilty of a misdemeanor,
and, shall upon conviction, must be fined not
more than one thousand dollars nor less than one hundred dollars in the
discretion of the court.
The board, in addition to the criminal penalties provided by this
section, may also assess a civil penalty against the violator in the form
of a fine not exceeding two thousand dollars for each violation. This
civil penalty may be assessed in addition to or in lieu of the criminal
penalties authorized by this section."
SECTION 4. Section 34-29-230 of the 1976 Code is repealed.
SECTION 5. This act takes effect upon approval by the Governor.
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