H*4818(Rat #0314, Act #0234 of 2004)  General Bill, By Cato, J.H. Neal, 
Moody-Lawrence, Lloyd, R. Brown, Emory, Mack, Cobb-Hunter, Govan, Chellis, 
Whipper, Trotter, Cooper, White, Barfield, Harrison, Sandifer, Thompson, McGee, 
Merrill, W.D. Smith and Huggins
 AN ACT TO AMEND SECTION 37-2-203, CODE OF LAWS OF SOUTH CAROLINA, 1976,
 RELATING TO DELINQUENCY CHARGES IN CONNECTION WITH A CREDIT SALE, SO AS TO
 PROVIDE THAT A DELINQUENCY CHARGE MUST NOT BE APPLIED TO A DELINQUENCY
 ATTRIBUTABLE ONLY TO AN ASSESSMENT AGAINST AN EARLIER INSTALLMENT AND TO
 PROVIDE FOR CONSTRUCTION OF THE PROVISION IN CONFORMITY WITH FEDERAL LAW; TO
 AMEND SECTION 37-3-202, RELATING TO ADDITIONAL CHARGES PERMITTED IN CONNECTION
 WITH A CONSUMER LOAN, SO AS TO INCLUDE OPEN-END CREDIT PURSUANT TO A LENDER
 CREDIT CARD OR SIMILAR ARRANGEMENT IN CONFORMANCE WITH OTHER PROVISIONS AND TO
 MAKE A TECHNICAL CORRECTION; TO AMEND SECTION 37-3-203, RELATING TO
 DELINQUENCY CHARGES IN CONNECTION WITH A CONSUMER LOAN, SO AS TO PROVIDE THAT
 THE DELINQUENCY CHARGE MUST NOT BE APPLIED TO A DELINQUENCY ATTRIBUTABLE ONLY
 TO AN ASSESSMENT AGAINST AN EARLIER INSTALLMENT AND TO PROVIDE FOR
 CONSTRUCTION OF THE PROVISION IN CONFORMITY WITH FEDERAL LAW; AND TO AMEND
 SECTION 37-3-303, RELATING TO NOTICE TO CO-SIGNERS AND SIMILAR PARTIES TO A
 CONSUMER LOAN, SO AS TO INCLUDE A CONSPICUOUS NOTICE IN CONFORMITY WITH OTHER
 LAW AND TO MAKE A TECHNICAL CORRECTION. - ratified title

   02/19/04  House  Introduced and read first time HJ-57
   02/19/04  House  Referred to Committee on Labor, Commerce and
                     Industry HJ-58
   03/25/04  House  Committee report: Favorable with amendment Labor,
                     Commerce and Industry HJ-2
   03/30/04  House  Amended HJ-21
   03/30/04  House  Read second time HJ-23
   03/31/04  House  Read third time and sent to Senate HJ-12
   03/31/04  Senate Introduced and read first time SJ-14
   03/31/04  Senate Referred to Committee on Banking and Insurance SJ-14
   04/29/04  Senate Committee report: Favorable Banking and Insurance SJ-20
   05/04/04  Senate Read second time SJ-13
   05/05/04  Senate Read third time and enrolled SJ-11
   05/06/04         Ratified R 314
   05/11/04         Signed By Governor
   05/14/04         Copies available
   05/14/04         Effective date 05/11/04
   05/18/04         Act No. 234

(A234, R314, H4818)

AN ACT TO AMEND SECTION 37-2-203, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO DELINQUENCY CHARGES IN CONNECTION WITH A CREDIT SALE, SO AS TO PROVIDE THAT A DELINQUENCY CHARGE MUST NOT BE APPLIED TO A DELINQUENCY ATTRIBUTABLE ONLY TO AN ASSESSMENT AGAINST AN EARLIER INSTALLMENT AND TO PROVIDE FOR CONSTRUCTION OF THE PROVISION IN CONFORMITY WITH FEDERAL LAW; TO AMEND SECTION 37-3-202, RELATING TO ADDITIONAL CHARGES PERMITTED IN CONNECTION WITH A CONSUMER LOAN, SO AS TO INCLUDE OPEN-END CREDIT PURSUANT TO A LENDER CREDIT CARD OR SIMILAR ARRANGEMENT IN CONFORMANCE WITH OTHER PROVISIONS AND TO MAKE A TECHNICAL CORRECTION; TO AMEND SECTION 37-3-203, RELATING TO DELINQUENCY CHARGES IN CONNECTION WITH A CONSUMER LOAN, SO AS TO PROVIDE THAT THE DELINQUENCY CHARGE MUST NOT BE APPLIED TO A DELINQUENCY ATTRIBUTABLE ONLY TO AN ASSESSMENT AGAINST AN EARLIER INSTALLMENT AND TO PROVIDE FOR CONSTRUCTION OF THE PROVISION IN CONFORMITY WITH FEDERAL LAW; AND TO AMEND SECTION 37-3-303, RELATING TO NOTICE TO CO-SIGNERS AND SIMILAR PARTIES TO A CONSUMER LOAN, SO AS TO INCLUDE A CONSPICUOUS NOTICE IN CONFORMITY WITH OTHER LAW AND TO MAKE A TECHNICAL CORRECTION.

Be it enacted by the General Assembly of the State of South Carolina:

Delinquency charges in credit sales

SECTION    1.    Section 37-2-203(5) of the 1976 Code is amended to read:

"(5)    A delinquency charge pursuant to this section must not be collected on a payment that is otherwise a full installment payment for the applicable period and is paid on its due date or within ten days after its due date if the only delinquency is attributable to a late fee or a delinquency charge assessed on an earlier installment. It is the intent of the legislature that, in construing this subsection the courts be guided by interpretations to 16 C.F.R. 444.4 and 12 C.F.R. 227.15, as amended from time to time, relating to late charges, given by the Federal Trade Commission, Federal Reserve Board, and the Federal Courts."

Additional charges in consumer loans

SECTION    2.    Section 37-3-202(1)(c) of the 1976 Code is amended to read:

"(c)    with respect to open-end credit pursuant to a lender credit card or similar arrangement, as defined in Section 37-1-301(16), which entitles the debtor to purchase or lease goods or services from at least one hundred persons not related to the lender, under an arrangement pursuant to which the debts resulting from the purchases or leases are payable to the lender;

(i)    annual charges, payable in advance, for the privilege of using the lender credit card or other credit arrangement; and

(ii)    an over-limit charge not to exceed ten dollars if the balance of the account exceeds the credit limit established pursuant to the agreement between the lender and the debtor plus the lesser of ten percent of the credit limit or one hundred dollars. The over-limit charge authorized by this subitem must not be assessed again against the debtor unless the account balance has been reduced below the credit limit plus the lesser of ten percent of the credit limit or one hundred dollars, and the debtor's account balance subsequently exceeds the credit limit plus the lesser of ten percent of the credit limit or one hundred dollars; and"

Delinquency charges in consumer loans

SECTION    3.    Section 37-3-203(5) of the 1976 Code is amended to read:

"(5)    A delinquency charge pursuant to this section must not be collected on a payment that is otherwise a full installment payment for the applicable period and is paid on its due date or within ten days after its due date if the only delinquency is attributable to a late fee or a delinquency charge assessed on an earlier installment. It is the intent of the legislature that in construing this subsection, the courts be guided by interpretations to 16 C.F.R. 444.4 and 12 C.F.R. 227.15, as amended from time to time, relating to late charges, given by the Federal Trade Commission, Federal Reserve Board, and the Federal Courts."

Notice to cosignors and similar parties

SECTION    4.    Section 37-3-303(2) of the 1976 Code is amended to read:

"(2)    A clear and conspicuous notice in substantially the following form complies with this section:

You agree to pay the debt identified below although you may not personally receive any property, services, or money. You may be sued for payment although the person who receives the property, services, or money is able to pay. This notice is not the contract that obligates you to pay the debt. Read the contract for the exact terms of your obligation.

________________________________________________________

________________________________________________________

________________________________________________________

________________________________________________________

I have received a copy of this notice.

_______________________                ___________________________

(Date)                                                     (Signed)"

Notice to cosignors and similar parties

SECTION    5.    Section 37-3-303(5) of the 1976 Code is amended to read:

"(5)    A notice to co-signer which complies with the Federal Trade Commission's Trade Regulation Rule on Credit Practices (16 C.F.R. Section 444) or which complies with a regulation regarding co-signer notices promulgated by any federal agency pursuant to Section 18(f) of the Federal Trade Commission Act, 15 U.S.C. Section 57a(f) (Section 202(a) of the Magnuson-Moss Warranty-Federal Trade Commission Improvement Act, Public Law 93-63F) likewise complies with this section, provided that the notice does not indicate that the creditor may collect any amount or engage in any activity which would be illegal under South Carolina law and the notice contains the following information signed and dated by the co-signer:

________________________________________________________

________________________________________________________

________________________________________________________

________________________________________________________

I have received a copy of this notice.

_______________________                 ___________________________

(Date)                                                    (Signed)"

Time effective

SECTION    6.    This act takes effect upon approval by the Governor.

Ratified the 6th day of May, 2004.

Approved the 11th day of May, 2004.