S*890 Session 109 (1991-1992)
S*0890(Rat #0162, Act #0098 of 1991) General Bill, By
Senate 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.
04/16/91 Senate Introduced, read first time, placed on calendar
without reference SJ-11
04/17/91 Senate Read second time SJ-17
04/18/91 Senate Read third time and sent to House SJ-14
04/23/91 House Introduced and read first time HJ-238
04/23/91 House Referred to Committee on Labor, Commerce and
Industry HJ-239
05/08/91 House Committee report: Favorable Labor, Commerce and
Industry HJ-9
05/15/91 House Read second time HJ-28
05/16/91 House Read third time and enrolled HJ-8
05/27/91 Ratified R 162
05/30/91 Signed By Governor
05/30/91 Effective date 05/30/91
05/30/91 Act No. 98
06/26/91 Copies available
(A98, R162, S890)
AN ACT 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:
Charges revised
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 two thousand dollars, twenty dollars
per one hundred dollars on that portion of the cash advance not exceeding
two hundred dollars; eighteen dollars per one hundred dollars on that
portion of the cash advance exceeding two hundred dollars but not
exceeding six hundred dollars; eleven dollars per one hundred dollars on
that portion of the cash advance exceeding six hundred dollars but not
exceeding one thousand dollars; and nine dollars per one hundred dollars
on that portion of the cash advance exceeding one thousand dollars but not
exceeding 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 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 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-month period. Upon any
loan made to the borrower of a sum in excess of the amount on which the
initial charge may have been charged within the three-month period, then
the initial charge may be contracted for and received on the excess. The
initial charge is a one-time charge, not a per annum charge, and is not
subject to refund.
(3) Loans Over Two Thousand But Not Over Seventy-Five
Hundred Dollars.--On loans with a cash advance exceeding two thousand
dollars but not exceeding seventy-five hundred dollars, the finance charges
authorized in subparagraphs (1) and (2) of this subsection (a) are not
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. The initial charge 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. Upon any loan made to the borrower of a
sum in excess of the amount on which the initial charge may have been
charged within the twelve-month period, then the initial charge may be
contracted for and received on 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 is not subject to
refund."
Adjustments for inflation
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 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."
Penalties revised
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, is
guilty of a misdemeanor and, 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."
Repeal
SECTION 4. Section 34-29-230 of the 1976 Code is repealed.
Time effective
SECTION 5. This act takes effect upon approval by the Governor.
Approved the 30th day of May, 1991. |