Chapter 3

COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 1CHAPTER 3 LOANS Article 1. General Provisions. Article 2. Maximum Charges. Article 3. Disclosure. Article 4. Limitations on Agreements and Practices. Article 5. Regulated Loans. Article 6. Loans other than Consumer Loans. ARTICLE 1 GENERAL PROVISIONS § 3101. Short Title. § 3102. Scope. § 3103. Index of Definitions. § 3104. Definition: Consumer Loan. § 3105. Same: Business Collateral. § 3106. Same: Loan . § 3107. Same: Lender; Precomputed; Premium Finance Loan; Principal. § 3108. Same: Revolving L oan Account. § 3109. Sale of Unpaid Earnings. § 3110. Loan Finance Charge Defined . § 3101. Short Title. This Chapter shall be known and may be cited as Uniform Consumer Credit Code -Loans . § 3102. Scope. This Chapter applies to consumer loans, includin g regulated loans; in addition Article 6 applies to loans other than consumer loans. § 3103. Index of Definitions. The following definitions apply to this Act and appear in this Chapter as follows: Business collateral § 3105 Consumer loan §3104 Lender § 3107(1)COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 2Loan § 3106 Loan finance charge § 3110 Precomputed loan § 3107(2)

ter as follows: Business collateral § 3105 Consumer loan §3104 Lender § 3107(1)COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 2Loan § 3106 Loan finance charge § 3110 Precomputed loan § 3107(2) Premium finance loan § 3107(3) Principal § 3107(4) Regulated loan § 3501 Revolving loan account § 3108 § 3104. Defini tion: Consumer Loan. (1) Except as provided in Subsection (2), consumer loan is a loan: (a) made by a person engaged in the business of making loans; (b) in which the debtor is a person other than an organization; and (c) in which the debt is incurred pr imarily for a person al, family, household or agricultural purpose. (2) Consumer loan does not include a loan which is secured primarily by: (a) a business collateral, if at the time the loan is made the value of this collateral is substantial in relation totheamount of the loan; or (b) an interest in land, if at the time the loan is made the valu e of this collateral is substantial in relation to the amount of the loan, and the loan finance charge, however calculated, does not exceed ten percent (10%) pe r year calculated on the unpaid balances of the principal accord ing to the United States rules.

unt of the loan, and the loan finance charge, however calculated, does not exceed ten percent (10%) pe r year calculated on the unpaid balances of the principal accord ing to the United States rules. For the purpose of calculat ing the rate of the loan finance charge, (i) non -periodic charges made at the inception of the loan which are included in the loan finance charge shall be amortized over the agreed term of the loan, notwithstanding that the loan is paid prior to the agreed maturity, and (ii) charges for the privilege of prepay ing the loan shall not be included in the loan finance charge. § 3105. Busi ness Collateral Defined. Business Collat eralmeans real property used primarily for other than a personal, family, household or agricultural purpose, or accounts or COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 3contract rights other than earnings, business equipment, chattel paper, docu ments of ti tle, instruments, inventory, business general intangi bles or in vestment securities, other than invest ment certificates issued by the creditor. Business equip ment does not include farm equipment. § 3106. Loan Defined.

entory, business general intangi bles or in vestment securities, other than invest ment certificates issued by the creditor. Business equip ment does not include farm equipment. § 3106. Loan Defined. Loan includes: (a) The creation of debt by the lender's payment of or agreement to pay money to the debtor or to a third party for the account of the debtor; (b) The creation of debt by the opening of an account with the lender entitling the debtor to draw immediately on the lender; (c) The creation of a debt pursuant to a preexisting credit card or similar arrange ment; and (d) The forbearance of a debt arising from a loan. § 3107. Lender; Precomputed; Premium Finance Loan; Principal; All Defined. (1) Lender means a person who makes a loan and any transferee of a lender's right to pay ment. (2) A loa n, refinancing or consolidation is precom puted if the debt is expressed as a sum comprising the principal and the amount of the loan finance charge computed in advance. (3) Premiu m Finance Loan is a consumer loan made primari ly for the purpose of paying an insurer, or other person on behalf of the insur er, the amount of premiums on insurance issued for the benefit of the debtor.

ance Loan is a consumer loan made primari ly for the purpose of paying an insurer, or other person on behalf of the insur er, the amount of premiums on insurance issued for the benefit of the debtor. (4) Principal of a loan mea ns the total of (a) the net amount paid to, receivable by or paid or payable for the account of the debtor, (b) the amount of any discount de scribed in § 3110(2) (loan finance charge), (c) amounts actually paid or to be paid by the lender for registration, certificate of title or license fees if not included in (a), and (d) additional charges permitted by this Chapter (§ 3202). § 3108. Revolving Loan Account Defined. Revolving Loan Account means an arrangement between a lender and a debtor pursuant to which (1) it is contempl ated by the parties that the lender may make loans to the debtor from time to time, (2) the debts COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 4arising from loans, loan finance charges and other charges will be debit - ed to an account, (3) a loan finance charge will not be precomputed but may be comput ed from time to time on the basis of the debtor's unpaid balances, and (4) debtor will have the privilege of paying the

an account, (3) a loan finance charge will not be precomputed but may be comput ed from time to time on the basis of the debtor's unpaid balances, and (4) debtor will have the privilege of paying the balances in installments. § 3109. Sale of Unpaid Earnings. If a sale of unpaid earnings is made in consideration of the payment of mo ney to or for the account of the seller, the transaction is deemed to be a loan to the seller secured by an assignment of earnings. The principal of the loan is equal to the money paid to or for the account of the seller, and the difference between this am ount and the amount of the unpaid earnings sold is the loan finance charge. § 3110. Loan Finance Charge Defined. (1) Loan Finance Charge means the total of (a) all charges however denominat ed,incurred for the privilege of obtaining the loan and paid or payable, dir ectly or indirectly, by the debtor to or for the account of the lender or a person related to or designat ed by the lender, and (b) charges incurred for investigating the collateral or credit -worthiness of the debtor or for commis sions or bro kerage for obtaining the credit, irrespective of the person to whom it is paid or payable,

ges incurred for investigating the collateral or credit -worthiness of the debtor or for commis sions or bro kerage for obtaining the credit, irrespective of the person to whom it is paid or payable, unless the lender had no notice of the charges. It does not include charges as a result of a default, additional charges (§ 3202), delin quency charges (§ 3203) and deferral charges (§ 3204). (2) If a lender makes a loan to a debtor by purchasing or satisfying obligations of the debtor pursuant to a credit card or similar arrangement, and the purchase or satisfaction is made at less than the face amount of the obliga tion, the discount is not part of the loan finance charge. ---------- ARTICLE 2 MAXIMUM CHARGES § 3201. Loan Finance Charge for Consumer Loans Other Than Regulated Loans and Revolving Loan Accounts. § 3202. Additional Charges. § 3203. Delinquency Char ges. COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 5§ 3204. Deferral Charges. § 3205. Loan Finance Charge: Refinancing. § 3206. Same: Consolidation. § 3207. Filed Rates Excluded. § 3208. Advances to Perform Covenants of Debtor. § 3209. Right to Prepay. § 3210. Rebate Upon Prepayment. § 3201.

nance Charge: Refinancing. § 3206. Same: Consolidation. § 3207. Filed Rates Excluded. § 3208. Advances to Perform Covenants of Debtor. § 3209. Right to Prepay. § 3210. Rebate Upon Prepayment. § 3201. Loa n Finance Charges for Consumer Loans Other Than Regulated Loans and Revolv ing Loan Accounts. (1) With respect to a consumer loan other than a regulated loan or a loan pursuant to a revolving loan account, a lender may contract for and receive a loan fin ance charge, however calculat ed, not in excess of ten percent (10%) per year calculat ed on the unpaid balances of the principal according to the United States rule. (2) For the purposes of this section, the term of a loan shall be calculated in terms of calendar months beginning with the date the loan is made. Differences in the lengths of months are disregarded. Fractions of a month are treat ed as a full month if mor e than 15 days, and if 15 days or less, are disregarded. § 3202. Additional Charges. (1) In addition to the loan finance charge permitted by this Article, the lender may contract for and receive the following additional charges in connection with a consumer loan: (a) official fees; (b) charges for insurance; (c)

inance charge permitted by this Article, the lender may contract for and receive the following additional charges in connection with a consumer loan: (a) official fees; (b) charges for insurance; (c) annual charges, payable in advance, for the privi lege of using a credit card or similar arrangement which entitles the user to purchase goods or services from at least 100 persons not related to the issuer of the credit card or similar arrangement, under an ar - rangement pursuant to which the debts re sulting from the purchases arepayable to the issuer; and (d) charges for other benefits conferred on the debtor, if the benefits are of value to him apart from the granting of the credit and the charges are reasonable in relation t o the benefits. COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 6(2) The Administrator may adopt rules determining whether charges areadditional charges pursuant to paragraph (d) of subsection (1). § 3203. Delinquency Charges. (1) With re spect to a precom puted consumer loan, the parties to a loan m ay contract for a delinquency charge on any instalment not paid in full within 10 days after its scheduled due date in an amount not to exceed the gr

ecom puted consumer loan, the parties to a loan m ay contract for a delinquency charge on any instalment not paid in full within 10 days after its scheduled due date in an amount not to exceed the gr eater of: (a) Two Dollars ($2.00) or an amount, not exceeding Five Dollars ($5.00), which is 5% of the unp aid amount of the installment; or (b) the deferral charge that would be permitted under § 3204(1) to defer the unpaid amount of the instal ment for the period that it is delinquent. (2) A delinquency charge under subsection (a)(1) may be collected only o nce on an install ment however long it remains in default. No delinquency charge may be collected if the installment has been deferred and a deferral charge has been paid in accordance with § 3204. A delinquency charge may be collected at the time it is as sessed or at any time thereafter. (3) No delinquency charge may be collected on an install ment which is paid in full within 10 days after a sched uled installment due date even though an earlier maturing install ment or a delinquency charge on it may not have been paid in full. (4) If two installments or parts thereof of a precomputed loan are in default for 10 days, or more,

ough an earlier maturing install ment or a delinquency charge on it may not have been paid in full. (4) If two installments or parts thereof of a precomputed loan are in default for 10 days, or more, the lender may elect to convert the loan from a precomputed loan to one in which the loan finance charge is based on unpaid balanc es. In this event he shall make a rebate pursuant to the provisions on rebate upon prepayment (§ 3210) as of the maturity date of the first delinquent installment, and thereafter may make a loan finance charge as authorized by the provisions on loan financ e charge for consumer loans (§ 3201) or the provisions on loan finance charge for regulated loans governing non -precomputed loans (§ 3508(3)), whichever is appropriate. The amount of the rebate shall not be reduced by the a mount of the minimum re tained ch arge pursuant to § 3210(1). If the lender proceeds under this subsection, any delinquency or deferral charges made with respect to installments due at or after the matu rity COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 7date of the first delinquent installment shall be rebated, and no further delinque ncy or deferral charges shall be made.

or after the matu rity COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 7date of the first delinquent installment shall be rebated, and no further delinque ncy or deferral charges shall be made. The amounts of $2.00 and $5.00 in subsection (1) are subject to change pursuant to the provisions on adjustment of dollar amounts (§ 1106). § 3204. Deferral Charges. (1) With respect to a precom puted consumer loan , the parties may befor e or after default agree in writing to a deferment of all or part of one or mor e unpaid installments, and the lender may make a charge not in excess of 18% per year of the amount deferred for the period of defer - ment (and pro portion ally for parts of a month, counting each day as one - thirtieth (1/30) of a month). A deferral charge may be collected at the time it is assessed or at any time thereafter. If the deferral charge calculated pursuant to this subsection is less than $2.00, a d eferral charge of $2.00 may nevertheless be made. (2) The lender may, in addition to the deferral charge, make appropriate additional charges listed in § 3202, and the amount of these charges, which is not paid in cash, may be added to the amount deferred for the

may, in addition to the deferral charge, make appropriate additional charges listed in § 3202, and the amount of these charges, which is not paid in cash, may be added to the amount deferred for the purpose of calculating the deferral charge. (3) The parties may agree in writing at the time the loan is made that if an installment is not paid within 10 days after its due date, the lender may unilaterally grant a deferment and make charges as provided in this section. No deferral charge may be made for a period after the date that the lender elects to accelerate the maturity of the agreement. (4) No delinquency charge may be made or retained by the lender for the period of deferral of any inst allment which has been deferred pursuant to this section. (5) The amounts of $2.00 in subsection (1) are subject to change pursuant to the provisions on adjustment of dollar amounts (§ 1106). § 3205. Loan Finance Charge -Refinancing. With respect to a precomputed consumer loan, the lender may by agree ment with the debtor refinance the unpaid balance and may contract for and receive a loan finance charge based on the principal resulting from the refinancing at a rate not in excess of that

by agree ment with the debtor refinance the unpaid balance and may contract for and receive a loan finance charge based on the principal resulting from the refinancing at a rate not in excess of that permitted by the provisions on loan finance charge for consum erloans (§ 3201) or the provisions on loan finance charge for regulated loans (§ 3508), whichever is appropriate. For the purpose of determining the loan COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 8finance charge permitted, the principal resulting fr om t he refinancing compris es the following: (1) The amount which the debtor would have been required to repay upon a prepay ment pursuant to the provisions on rebate upon prepayment (§ 3210) on the date of refinancing, except that for the purpose of compu ting this amount the minimum retained loan finance charge pursuant to § 3210(1) shall not be included; [and] (2) The appropriate additional charges made pursu ant to § 3202 but not paid in cash by the debtor. § 3206. Loan Finance Charge -Consolidation. (1) If a lender makes a consumer loan, other than one pursuant to a revolving loan account, to a debtor who has an unpaid balance owing to the lender with respect

Loan Finance Charge -Consolidation. (1) If a lender makes a consumer loan, other than one pursuant to a revolving loan account, to a debtor who has an unpaid balance owing to the lender with respect to a previous consumer loan, the parties may agree to a consolidation resulting in a single schedule of payments. If the previous consumer loan is not a precomputed loan, the parties may agree to add the unpaid amount of principal at the date of consolidation to the princi pal with respect to the subsequent loan. If the previous consumer loan is a precomputed loan, the parties may agree to refinance the unpaid balance pursuant to the provisions on refinancing (§ 3205) and to consoli date the principal resulting from the refinancing by adding it to the principal with respect to the subsequent loan . In either case the lender may contract for and receive a loan finance charge based on the aggregate principal resulting from the consolida tion at a rate not in excess of that permitted by the provisions on loan finance charge for consum erloans (§ 3201 ) or the provi sions on loan finance charge for regulated loans (§ 3508), whichever is appropriate.

not in excess of that permitted by the provisions on loan finance charge for consum erloans (§ 3201 ) or the provi sions on loan finance charge for regulated loans (§ 3508), whichever is appropriate. (2) The parties may agree to consolidate the unpaid balance of a consumer loan, other than one pursuant to a revolving loan account, with the unpaid balanc e of a consumer cr edit sale, other than one pursuant to a revolving charge account. The parties may agree to refinance the previous unpaid balance pursuant to the provi sions on refinancing sales (§ 2205) or the provi sions on refinancing loans (§ 2305), w hichever is appropri ate, and to consolidate the amount financed resulting from the refinancing or the principal resulting from the refinancing by adding it to the amount financed or principal with respect to the subsequent sale or loan. The aggregate amo unt resulting from the consolidation shall be deemed principal, and the creditor may contract for and receive a loan COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 9finance charge based on the principal at a rate not in excess of that permitted by the provisions on loan finance charge for consumer loans (§ 3201) or the

GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 9finance charge based on the principal at a rate not in excess of that permitted by the provisions on loan finance charge for consumer loans (§ 3201) or the provi sions on loan finance charge for regulated loans (§ 3508), whichever is appropriate. § 3207. Filed Rates Excluded. This Article does not apply to loans with respect to which rates of loan finance charts, however denomi nated, are fi led with and subject to approval or disapproval by a subdivision or agency of this Territory or of the United States. § 3208. Advances to Perform Covenants of Debtor. (1) If the agreement with respect to a consumer loan contains covenants by the debtor to perform certain duties pertaining to insuring or preserving collateral and if the lender pursu ant to the agreement pays for performance of the duties on behalf of the debtor he may add the amounts paid to the debt. Within a reasonable time after advanc ing any sums, he shall state to the debtor the amount of the sums advanced, any charges with respect to this amount, and the revised payment schedule. No further information need by given.

ter advanc ing any sums, he shall state to the debtor the amount of the sums advanced, any charges with respect to this amount, and the revised payment schedule. No further information need by given. (2) A loan finance charge may be made for sums ad vanced pursuant to subsection (1) at a rate not in excess of the rate of return yielded by the loan finance charge under the loan, except that in a revolving loan account the amount of the advance may be added to the unpaid balance of the debt and an authorized lender may make a loan finance charge not in excess of that permitted by the provisions on loan finance charge for revolv ing loan accounts (§ 3201). § 3209. Right to Prepay. The debtor may prepay in full the unpaid balance of a consumer loan, other than a consum erloan secured pri marily by real property, at any time without penalty. § 3210. Rebate Upon Prepayment. (1) Upon prepayment in full of a precomputed consumer loan, the unearned portion of the loan finance charge shall be rebated to the debtor. If the o bligation of the debtor pursuant to a consumer loan contains a portion of the loan finance charge by reason of discount or otherwise, the unearned portion of the loan

rebated to the debtor. If the o bligation of the debtor pursuant to a consumer loan contains a portion of the loan finance charge by reason of discount or otherwise, the unearned portion of the loan finance charge shall be rebated to the debtor upon prepayment. If the earned portion of t he loan COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 10finance charge is an amount less than the amount of the minimum retained charge, the lender may retain the amount of the minimum charge. The minimum retained charge is an amount which is the great er of either $10.00 or an amount, not exceeding Twe nty-Five Dollars ($25.00), which is 5% of the principal. If the required rebate is less than One Dollar ($1.00), no rebate need be made. (2) Upon prepayment in full of a consumer loan other than a precomputed loan or one pursuant to a revolving loan accou nt, the lender may collect from the debtor a charge equal to the amount of the minimum retained charge. (3) The unearned loan finance charge is a fraction of the loan finance charge of which the numerator is the sum of the periodic balances scheduled to f ollow the computational period in which prepayment occurs, and the denominator is

ge is a fraction of the loan finance charge of which the numerator is the sum of the periodic balances scheduled to f ollow the computational period in which prepayment occurs, and the denominator is the sum of all periodic balances under either the loan agreement or, if the balance owing resulted from a refinancing agreement (§ 3205) or a con solidation agreement (§ 3206 ) under the refinanc ing agreement or consolidation agreement. (4) In this section: (a) periodic balance means the amount scheduled to be outstanding on the last day of a computational period before deducting the payment, if any, scheduled to be made on that day; (b) computational period means one (1) month if one -half (1/2) or mor e of the inter vals between scheduled payments under the agreement is one month, or more, shall other wise mean one week, except that the total interval prior to the due date o f the first scheduled instal ment shall always be consid ered one computational period. (5) (a) If the computational period is one (1) month: (i) and the number of da ys be tween the date of a loan, refinanc ing or consolidation and the due date of the firs t sched uled installment is less than twenty -five

ational period is one (1) month: (i) and the number of da ys be tween the date of a loan, refinanc ing or consolidation and the due date of the firs t sched uled installment is less than twenty -five (25) days or more than thirty -five (35) days but not more than forty -five (45) days, the unearned loan finance charge shall be in creased by an adjustment for each day by which the interval is less than thi rty (30) days and, at the option of the lender, may be reduced by an adjustment for each day by which the interval is mor e tha n thirty (30) days; the adjustment for each day COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 11shall be one -thirtieth (1/30th) of that part of the loan finance charge earned in thecomputational period prior to the due date of the first scheduled instal ment assuming that period to be one (1) month; (ii) and the interval between the date of the loan, refinancing or consolidation and the final scheduled payment date is a number o f full months plus an additional number of days less than a full month, the additional number of days shall be considered a computational period only if sixteen (16) days, or more; (b) If the computational period is one

n additional number of days less than a full month, the additional number of days shall be considered a computational period only if sixteen (16) days, or more; (b) If the computational period is one (1) week: (i) and the number of da ys be tween the date of the loan, refinanc ing or consolidation and the due date of the first sched uled instalment is less than five (5) days or more than nine (9) days but not more than eleven (11) days, the unearned loan finance charge shall be increased by an adjustment for each day by which the interval is less than seven (7) days and, at the option of the lender, may be reduced by an adjust ment for each day by which the interval is more than seven (7) days; the adjustment for each day shall be one -seventh (1/7th) of that part of the loan finance charge earned in the computational period prior to the due date of the first scheduled instalment assuming that period to be one (1) month; (ii) and the interval between the date of the loan, refi nancing or co nsolidation and the final sched uled payment date is a number of full weeks plus an additional number of days less than a full week, the additional number of days shall be considered a

nancing or co nsolidation and the final sched uled payment date is a number of full weeks plus an additional number of days less than a full week, the additional number of days shall be considered a computational period only if four (4) days, or more. (6) If a deferral has been agreed to pursu ant to § 3204, the unearned loan finance charge shall be computed without regard to the defer ment. The a mount of defer ment charge earned at the date of prepayment shall be calculated. If the deferment charge earned is less than th e defer ment charge paid, the difference shall be added to the amount of the unearned loan fi nance charge. Any part of a deferment charge which has been earned but not paid, shall be subtracted from any rebate of loan finance charge otherwise due, or shall beadded to the unpaid balance. (7) This Section does not preclude the collection or reten tion by the lender of delin quency charges made pursuant to § 3203. (8) If the maturity is accelerated for any reason and judgment is obtained, the debtor is entitl ed to the same rebate as though the agree - ment had been prepaid at the date judg ment is enter ed.COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS

nd judgment is obtained, the debtor is entitl ed to the same rebate as though the agree - ment had been prepaid at the date judg ment is enter ed.COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 12(9) If the debtor dies prior to the maturity of the agree ment and the unpaid balance is paid by the proceeds of credit insurance on the life of the debtor, t he estate of the debtor is enti tled to the same rebate as though the debtor had prepaid the agreement on the date the proceeds of the credit insurance are paid to the lender, but no later than ten (10) days after proof of death is furnished. ---------- ARTICLE 3 DISCLOSURE [Repealed by P.L. 16 -73.] ---------- ARTICLE 4 LIMITATIONS ON AGREEMENTS AND PRACTICES § 3401. Exclusions. § 3402. Restrictions on Balloon Payments. § 3403. No Assignment of Earnings. § 3404. Attor neys' Fees. § 3405. Limitation on Default Charges. § 3406. Notice of Transfer. § 3407. Confession of Judgment. § 3401. Exclusions. (1) This Article does not apply to loans in which the principal is Twenty-Five Thousand Dollars ($25,000.00), or more. (2) The amount of Twenty -Five Thous and Dollars ($25,000.00) in Subsection (1) is subject to change pursuant to

to loans in which the principal is Twenty-Five Thousand Dollars ($25,000.00), or more. (2) The amount of Twenty -Five Thous and Dollars ($25,000.00) in Subsection (1) is subject to change pursuant to the provisions on adjust - ment of dollar amounts (§ 1106). § 3402. Restrictions on Balloon Payments. With respect to a consumer loan, other than one primarily for an agricultur al purpose or pursuant to a revolving loan account, if any payment is mor e than twice as large as the average of the other payments, the debtor has the right to refinance the amount of that payment at the time it is due without penalty or other charge. The terms COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 13of the refinancing shall be no less favor able to the buyer than the terms of the original loan. This limitation does not apply to the extent that the payment schedule is adjusted to the seasonal or irregular income of the debtor. § 3403. No Assignm ent of Earnings. A lender ma y not take an assignment of earnings of the debtor as security for payment of a consumer loan. An assignment of earnings in violation of this Section is void. § 3404. Attorneys' Fees.

gs. A lender ma y not take an assignment of earnings of the debtor as security for payment of a consumer loan. An assignment of earnings in violation of this Section is void. § 3404. Attorneys' Fees. Except as provided by the limita tions on attorneys' fees in certain regulated loans (§ 3512), with respect to a con sumer loan the agreement may provide for the recovery from the debtor of reasonable attor neys' fees not excess of fifteen percent (15%) of the unpaid debt at the time suit is br ought, if paid or payable to an attorney not a salaried employee of the lender. An agr eement in viola tion of this Section is void. § 3405. Limitation on Default Charges. Except for reason able expenses incurred in realizing on a security interest, the a greement with respect to a consumer loan may not provide for charges as a result of default by the debtor other than those authorized by this Act. An agreement in violation of this Section is void. § 3406. Notice of Transfer. The debtor is authorized to pay the original lender until he receives notification of transfer of rights to payment pursuant to a consumer loan and that payment is to be made to the transferee of the rights.

or is authorized to pay the original lender until he receives notification of transfer of rights to payment pursuant to a consumer loan and that payment is to be made to the transferee of the rights. A notification which does not reasonably identify the rights transferred is ineffective. If requested by the debtor, the transferee must seasonably furnish reasonable proof that the transfer has been made and unless he does so the debtor may pay the original lender. § 3407. Confession of Judgment. A debtor ma y not give a power o f attorney to any person to confess judgment on a claim arising out of a consumer loan. A power of attorney given in violation of this Section is void. ----------COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 14ARTICLE 5 REGULATED LOANS § 3501. Definition: Regulated Loan . § 3502. Authority to Make Re gulated Loans. § 3503. License to Make Regulated Loans. § 3504. Revocation or Suspension of License. § 3505. Books and Records. § 3506. Investigations. § 3507. Application of Administrative Adjudication Act. § 3508. Loan Finance Charge: Regulated Loa ns Other Than Revolving Loan Accounts. § 3509. Same: Revolving Loan Accounts. § 3510.

nvestigations. § 3507. Application of Administrative Adjudication Act. § 3508. Loan Finance Charge: Regulated Loa ns Other Than Revolving Loan Accounts. § 3509. Same: Revolving Loan Accounts. § 3510. Use of Multiple Agreements to Obtain Higher Rate. § 3511. Restrictions on Real Property Security. § 3512. Limitation on Attorneys' Fees. § 3513. Regular Schedule of P ayments; Maximum Loan Term. § 3514. Conduct of Business Other Than Making Loans. § 3515. Application of Other Provisions. § 3501. Definition: Regulated Loan. (1) Regulated loan means a consumer loan made pursuant to a revolving loan account; or (2) Any other consumer loan in which the rate of the loan finance charge is in excess of that provided by the provisions on loan finance charge for consumer loans (§ 3201). § 3502. Authority to Make Regulated Loans. No person shall engage in the business of mak ing regulated loans or taking assignments of rights to payment arising out of regulat ed loans unless the person is a supervised financial organiza tion or has first obtained a license from the Administrator authorizing him to make regu - lated loans.

to payment arising out of regulat ed loans unless the person is a supervised financial organiza tion or has first obtained a license from the Administrator authorizing him to make regu - lated loans. A pers on authorized to make or take assignments of regulated loans shall be known as an authorized lender. § 3503. License to Make Regulated Loans. (1) The Admin istrator shall receive and act on all applications for licenses to make regulated loans under this Act. Applications shall be filed in the ma nner prescribed by the Administrator and shall contain COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 15such information as the Administra tor may require to make an evaluation of the financial responsibility, character and fitness of the applicant. (2) No licen seshall be issued unless the Administrator, upon investigation, finds that the financial responsibility, character and fitness of the applicant, and of the members thereof (if the applicant is a co - partnership or association) and of the officers and direc tors thereof (if the applicant is a corporation) are such as to war rant belief that the business will be operated honestly and fairly within the purposes of this

ation) and of the officers and direc tors thereof (if the applicant is a corporation) are such as to war rant belief that the business will be operated honestly and fairly within the purposes of this Act. (3) Upon written request, the applicant is entitled to a hearing on the question of his qualifications for a license if (a) the Administra tor has notified the applicant in writing that his application has been denied, or (b) the Adminis trator has not issued a license within sixty (60) days after the application for the license was filed. A request for a hearing may not be ma de mor e than fifteen (15) days after the Administra tor has mailed a writing to the applicant notify ing him that the application has been denied and stating in substance the Administrator's findings supporting denial of the application. § 3504. Revocation or Suspension of License. (1) The Administrator may issue to a person licensed to make regulat ed loans an order to show cause why his license should not be re - voked or suspended for a period not in excess of six (6) m onths. The order shall state the place for a hearing and set a time for the hear ing that is no less than ten (10) days from the date

e re - voked or suspended for a period not in excess of six (6) m onths. The order shall state the place for a hearing and set a time for the hear ing that is no less than ten (10) days from the date of the order. After the hearing the Admin istrator shall revoke or suspend the license if he finds that: (a) the licensee has repeatedly and willfully violated this Act or any regulation or order lawfully made pursu ant to this Act; or (b) facts or conditions exist which would clearly have justified the Administrator in refusing to grant a license had these facts or condition s been known to exist at the time the application for the license was made. (2) No revocation or suspension of a license is lawful unless prior to institution of proceed ings by the Administrator notice is given to the licensee of the facts or conduct whic h warrant the intended action, and the licensee is given an opportunity to show compliance with all lawful requirements for retention of the license. (3) If the Administrator finds that probable cause for revocation of a COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 16license exists and that enforcement of this Act requires immediat e suspension of the

ministrator finds that probable cause for revocation of a COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 16license exists and that enforcement of this Act requires immediat e suspension of the license pending investi gation, he may, after a hearing upon five (5) days' written notice, enter an order suspending the licens e for not mor e than thirty (30) days. (4) Whenever the Administrator revokes o r suspends a license, he shall enter an order to that effect and forthwith notify the licensee of the revocation or suspension. Within five (5) days after the entry of the order he shall deliv erto the licensee a copy of the order and the findings support ing the order. (5) Any person holding a license to made regulated loans may relinquish the license by notifying the Administrator in writing of its relinquishment, but this relinquishment shall not affect his liability for acts previously committed. (6) No revocation, suspension or relinquish ment of a license shall impair or affect the obligation of any pre -existing lawful contract between the licensee and any debtor. (7) The Administrator may reinstate a li cense, terminate a suspension or grant a new li cense to a person

ect the obligation of any pre -existing lawful contract between the licensee and any debtor. (7) The Administrator may reinstate a li cense, terminate a suspension or grant a new li cense to a person whose license has been revoked or suspended if no fact or condition then exists which clearly would have justified the Administrator in refusing to grant a license. § 3505. Books and Records. Every licensee shall maintain such books an d records in accor dance with sound and accept ed accounting prin ciples and practices as will enable the Adminis trator to determine whether the licensee is complying with the provisions of this Act. The record keeping system of a licensee shall be suffic ient if it reasonably discloses the informa tion r equired. The books and records need not be kept in the place of business where regulated loans are made, if the Administra tor is given free access to such books and records wherever located. The records pe rtaining to any loan need not be pre served for more than two (2) years after making the final entry relating to the loan. § 3506. Investigations. For the purpose of discovering violations of this Act or securing information lawfully required by

r more than two (2) years after making the final entry relating to the loan. § 3506. Investigations. For the purpose of discovering violations of this Act or securing information lawfully required by him her eunder, the Administrator may at any time investi gate the loans and business and examine the books, accounts, records and files used therein, of every licensee. For such COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 17purpose the Adminis trator shall have free access to the offices and places of busine ss, books, accounts, papers, records, files, safes and vaults of the licensee. If the licensee's books and records are located outside this Territory the lender shall either make them available to the Administrator at a convenient location within this Terr itory or pay the reasonable and necessary expenses for the Administrator or his representative to examine them at the place where they are maintained. The Administrator may require the attendance of and examine under oath all persons whose testimony he ma y requir e relative to such loans or such business, and in such cases the Adminis trator shall have power to administer oaths to all persons called as witnesses.

ath all persons whose testimony he ma y requir e relative to such loans or such business, and in such cases the Adminis trator shall have power to administer oaths to all persons called as witnesses. § 3507. Application of Administrative Procedure [Adjudi cation] Act. Except as otherwise pro vided in this Article, administrative action taken by the Administrator pursuant to this Article is governed by the Administrative Adjudication Act. § 3508. Loan Finance Charge: Regulated Loans Other Than Revolving Loan Accounts. (1) With respect to a r egulat ed loan, other than a loan pursuant to revolving loan account, an authorized lender may contract for and receive a loan finance charge not in excess of that permit ted by this Section. With respect to a precomputed loan, the loan finance charge is computed on the amount of the principal for length of the term of the loan, notwithstanding that the loan is payable in install ments, and on the assumption that all scheduled payments will be made on time. So long as the loan finance charge does not exceed the equivalent of that permitted of this Section, it may be calculated by way of discount, monthly or annual percent age rate on the unpaid

on time. So long as the loan finance charge does not exceed the equivalent of that permitted of this Section, it may be calculated by way of discount, monthly or annual percent age rate on the unpaid balances, or otherwise. (2) In the case of a precomputed loan having a schedule of substantially equal and consecu tive monthly installments commencing thirty (30) days from the date the loan is made, the loan finance charge may not exceed the gr eater of either of the following: (a) the total of (i) thr ee percent (3%) per month upon that part of the loan not exceeding Three Hundred Dollars ($300.00); (ii) one and one -half percent (1 1/2%) per month upon that part of the loan in excess of Three Hun dred Dollars ($300.00) COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 18and not exceeding Five Hun dred Dollars ($500.00); (iii) one percent (1%) per month upon that part of the loan exceeding Five Hun dred Dollars ($500.00) and not exceeding One Thousand Five Hundred Dollars ($1,500.00); or (b) twenty -four percent (24%) per year calculated on the unpaid balances of the principal according to the United States rule.

00) and not exceeding One Thousand Five Hundred Dollars ($1,500.00); or (b) twenty -four percent (24%) per year calculated on the unpaid balances of the principal according to the United States rule. (3) With respect to a precomputed loan not governed by Subsection (2) or a loan which is not precomputed, the rate of the loan finance charge may not exceed a rate which, having due regard for the schedule of payments will produce a yield equivalent to that permit ted by Subsec - tion (2) for a loan having the same size, the same length of term, and a schedule of substan tially equal and consecutive monthly installments commencing thirty (30) days from the date loan is made. (4) Except as provided in Subsection (5), t he ter m of a loan for the purpose of this Sec tion shall be calculated in terms of calendar months beginning with the date the loan is made. Differences in the lengths of months are disre garded. Fractions of a month are treated as a full mont h if mor e tha n fifteen (15) days, and if fifteen (15) days or less, are disregarded. If a loan is for a period greater than or less than a year, the charges stated in Paragraph (a) of Subsection (2) shall be computed

fteen (15) days, and if fifteen (15) days or less, are disregarded. If a loan is for a period greater than or less than a year, the charges stated in Paragraph (a) of Subsection (2) shall be computed proportionally. (5) With respect to a premium financ e loan, the term of the loan may commence on the date of the inception of the insur ance contract ob - tained for the debtor pursuant to the premium finance loan agreement. (6) A lender may ma ke the same loan finance charge on all principal amounts within a specified range. In this case the principal amount for the purpose of Subsection (2) is the median amount of the range within which the actual principal amount is included. A charge may be made pursuant to this Subsection only if the same loan finance char ge is made for all principal amounts within the specified range and if the charge on the media n amount is no mor e tha n eight percent (8%) greater than the charge that would have been made on the actual principal amount pursu - ant to Subsection (2). (7) The amounts of Three Hundred Dollars ($300.00), Five Hundred Dollars ($500.00) and One Thousand Five Hundred Dollars ($1,500.00) in Subsection (2) are subject to change

u - ant to Subsection (2). (7) The amounts of Three Hundred Dollars ($300.00), Five Hundred Dollars ($500.00) and One Thousand Five Hundred Dollars ($1,500.00) in Subsection (2) are subject to change pursuant to the provisions on adjustment of dollar amounts (§ 1106). COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 19SOURCE: Subsection (2 )(b) amended by P.L. 16 -32. § 3509. Same: Revolving Loan Accounts. (1) With respect to a consumer loan made pursuant to a revolving loan account, an authorized lender may contract for and receive a loan finance charge not in excess of that permitted in th is Section. (2) A charge may be ma de in each billing cycle which is a percentage of an amount no greater than: (a) the average daily balance of the debt; (b) the unpaid balance of the debt on approximately the same day of the billing cycle; or (c) the m edian amount within a specified range within which the daily average balance or the unpaid balance of the debt, on ap - proximately the same day of the billing cycle, is included. A charge may be ma de pursu ant to this Paragraph only if the same percentage is applied to all balances within the specified range and if the charge calculated

day of the billing cycle, is included. A charge may be ma de pursu ant to this Paragraph only if the same percentage is applied to all balances within the specified range and if the charge calculated on the median amount pursuant to this Para graph is no more than eight percent (8%) greater than the charge that would have been calculated on the actual unpaid balance pursu ant to Para - graphs (a) and (b). (3) If the billing cycle is monthly, the charge may not exceed two percent (2%) of that part of the amount pursuant to Subsection (2) which is Five Hundred Dollars ($500.00), or less, and one and one -half percent (12%) on th at part of this amount which is more than Five Hundred Dollars ($500.00). If the billing cycle is not monthly, the maximum charge is that percentage which bears the same relation to the applicable monthly percentage as the number of days in the billing cyc le bears to thirty (30). For the purposes of this Section, a variation of not more than four (4) days from month to month is 'approx imately the same day of the billing cycle.' (4) If there is an unpaid balance on the date as of which the loan finance char ge is applied and the loan finance charge pursuant

onth to month is 'approx imately the same day of the billing cycle.' (4) If there is an unpaid balance on the date as of which the loan finance char ge is applied and the loan finance charge pursuant to this Section is less than the minimum charge, a minimum charge not exceeding Seventy Cents ($.70) may be made if the billing cycle is month ly, or, if the billing cycle is not monthly, a minimum charge which bears the same relation to Seventy Cents ($.70) as the number of days in the billing cycle bears to thirty (30) may be made; provided, that no COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 20minimum charge may be made pursuant to this Section if the lender has made a charge for the same period as permitted by Paragraph (c) of Subsection (1) of § 3202 (additional charges). (5) The amounts of Seventy Cents ($.70) in Subsection (4) are subject to change pursuant to the provisions on adjustment of dollar amounts (§ 1106). § 3510. Use of Multiple Agree ments to Obtain Higher Rate. With respect to a regulated loan, no lender may permit any person, or husband and wife, to become obligated in any way under more than one (1) loan agreement with the lender or with a person

er Rate. With respect to a regulated loan, no lender may permit any person, or husband and wife, to become obligated in any way under more than one (1) loan agreement with the lender or with a person related to the lender, with the in tent of obtaining a higher rate of loan finance charge than would other wise be permitted by the provisions on loan finance charge for consum erloans (§ 3508). The excess amount of loan finance charge provided for in agreements in violation of this Section areexcess charges for the purposes of the provisions on effect of violations on rights of parties (§ 5201) and the provisions on civil actions by Administrator (§ 6113). § 3511. Restrictions on Real Property Security. (1) With respect to a regulated l oan in which the principal is Five Hundred Dollars ($500.00), or less, a lender may not contract for a security interest in real property. A security interest taken in violation of this Section is void. (2) The amount of Five Hundred Dollars ($500.00) in S ubsection (1) is subject to change pursuant to the provisions on adjustment of dollar amounts (§ 1106). § 3512. Limitation on Attorneys’ Fees.

d. (2) The amount of Five Hundred Dollars ($500.00) in S ubsection (1) is subject to change pursuant to the provisions on adjustment of dollar amounts (§ 1106). § 3512. Limitation on Attorneys’ Fees. (1)With respect to a regulated loan in which the principal is Five Hundred Dollars ($500.00), or less, the ag reement may not provide for the recover y from the debtor of attorneys' fees. An agreement in violation of this Section is void. (2) The amount of Five Hundred Dollars ($500.00) in Subsection (1) is subject to change pursuant to the provisions on adjustment of dollar amounts (§ 1106). § 3513. Regular Schedule of Payments; Maxi mum Loan Term. (1) Regulated loans payable in installments in which the principal is COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 21One Thousand Five Hundred Dollars ($1,500.00), or less, shall be repayable in substantially equa l installments which shall be payable at equal periodic intervals, except as may be requested by the debtor by reason of fluctuations in his income because of the nature of his occupa - tion. Regulated loans in which the principal is One Thousand Five Hundre d Dollars ($1,500.00), or less, shall be scheduled to be

n of fluctuations in his income because of the nature of his occupa - tion. Regulated loans in which the principal is One Thousand Five Hundre d Dollars ($1,500.00), or less, shall be scheduled to be payable over a period of not mor e than thirty -six months (36) months. (2) The amounts of One Thousand Five Hundred Dollars ($1,500.00) in Subsection (1) are subject to change pursuant to the provisio ns on adjustment of dollar amounts (§ 1106). § 3514. Conduct of Business Other Than Making Loans. A licensee may carry on another business at the location where he makes regulat ed loans unless he carries on the business for the purpose of evasion or vi olation of this Act. § 3515. Application of Other Provisions. Except as other wise provided, all provisions of this Act applying to consumer loans apply to regulated loans. ---------- ARTICLE 6 LOANS OTHER THAN CONSUMER LOANS § 3601. Loans Subject to Act by Agr eement of Parties. § 3602. Loan Finance Charge for Certain Loans to Individuals. § 3603. Applicability of Other Provisions. § 3604. Limitation on Default Charges. § 3605. Loan Finance Charge for Other Loans. § 3601. Loans Subject to Act by Agreement of Parties.

ns to Individuals. § 3603. Applicability of Other Provisions. § 3604. Limitation on Default Charges. § 3605. Loan Finance Charge for Other Loans. § 3601. Loans Subject to Act by Agreement of Parties. The parties to a loan other than a consumer loan may agree in a writing signed by the parties that the loan is subject to the provi sions of this Act applying to consumer loans. If the parties so agree, the loan is a consumer loan f or the purposes of this Act. § 3602. Loan Finance Charge for Certain Loans to Individ uals. (1) With respect to a loan other than a consumer loan, the parties COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 22may contract for the payment by the debtor of a loan finance charge not in excess of that perm itted by this Section if: (a) the principal is Twenty -Five Thou sand Dollars ($25,000.00), or less; and (b) the debtor is either (i) a person other than an organization or (ii) an or ganization if the debt is secured primarily by a security interest in on e (1) or two (2) family dwelling occupied by a person related to the organization. (2) With respect to a loan other than one pursuant to a revolving loan account the parties may contract for the

n on e (1) or two (2) family dwelling occupied by a person related to the organization. (2) With respect to a loan other than one pursuant to a revolving loan account the parties may contract for the payment by the debtor of a loan finance charge not in excess of twenty -four percent (24%) per year calculated on the unpaid balances of the principal according to the United States rule. (3) With respect to a loan pursuant to a revolving loan account, the parties ma y contract for the payment by the debtor of a loan finance charge not in excess of that permitted by the provisions on loan finance charge for revolving loan accounts (§ 3509). (4) The amount of Twenty -Five Thousand Dollars ($25,000.00) in Subsection (1) is subject to change pursuant to the provisions on a djust - ment of dollar amounts (§ 1106). SOURCE: Subsection (2) amended by P.L. 16 -32. § 3603. Applicability of Other Provisions. Except for the rate of the loan finance charge, the provisions of Article 2 of this Chapter apply to a loan for which loan fi nance charge ceilings are set by § 3602 (certain loans to individuals). § 3604. Limitation on Default Charges.

ce charge, the provisions of Article 2 of this Chapter apply to a loan for which loan fi nance charge ceilings are set by § 3602 (certain loans to individuals). § 3604. Limitation on Default Charges. The agr eement with respect to a loan for which loan finance charge ceilings are set by § 3602 (certain loans to individuals) may not provide for any charges as a result of default by the debtor except for reasonable attorneys' fees and reason able expenses incurred in realizing on a security interest and charges that could have been made had the loan been a consumer loan. An agree ment in violat ion of this Section is void. § 3605. Loan Finance Charge for Other Loans. With respect to a loan other than a consumer loan or a loan for which loan finance charge ceilings are set by § 3602 (certain loans to COL12010614GCA UNIFORM CONSUMER CREDIT CODE CH.3LOANS 23individuals), the parties may contract for the pay ment by the debtor of any loa n finance charge agr eed in writing. ----------