Second Regular Session
Seventy-fourth General Assembly
STATE OF COLORADO
REENGROSSED
This Version Includes All Amendments
Adopted in the House of Introduction
LLS NO. 24-0731.01 Josh Schultz x5486
HOUSE BILL 24-1148
House Committees Senate Committees
Finance
A BILL FOR AN ACT
C
ONCERNING A MORE INCLUSIV E CALCULATION OF THE FINANCE101
CHARGE APPLICABLE TO CERTAIN CONSUMER LENDING102
TRANSACTIONS, AND, IN CONNECTION THEREWITH , REQUIRING103
A MORE ACCURATE DISCLOSURE OF THE COST OF CREDIT FOR104
CERTAIN LOANS.105
Bill Summary
(Note: This summary applies to this bill as introduced and does
not reflect any amendments that may be subsequently adopted. If this bill
passes third reading in the house of introduction, a bill summary that
applies to the reengrossed version of this bill will be available at
http://leg.colorado.gov.)
The bill amends the Colorado "Uniform Consumer Credit Code"
HOUSE
3rd Reading Unamended
March 28, 2024
HOUSE
Amended 2nd Reading
March 26, 2024
HOUSE SPONSORSHIP
Weissman and Mabrey, Bacon, Boesenecker, Brown, Daugherty, deGruy Kennedy,
Froelich, Garcia, Hernandez, Herod, Jodeh, Kipp, Lindsay, Mauro, McCluskie, Ortiz, Parenti,
Ricks, Rutinel, Sirota, Story, Titone, Willford
SENATE SPONSORSHIP
Gonzales,
Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment.
Capital letters or bold & italic numbers indicate new material to be added to existing law.
Dashes through the words or numbers indicate deletions from existing law. to change the terms and interest rates a nondepository institution may
charge in a consumer credit transaction.
For a consumer credit transaction in which a nondepository
institution makes a supervised loan or a consumer credit sale, the bill
amends the calculation of the total amount of the finance charge that the
nondepository institution may contract for and receive to include the total
cost of specific additional charges.
Be it enacted by the General Assembly of the State of Colorado:1
SECTION 1. In Colorado Revised Statutes, 5-1-301, add (29.5)2
as follows:3
5-1-301. General definitions. In addition to definitions appearing4
in subsequent articles, as used in this code, unless the context otherwise5
requires:6
(29.5) "N
ONDEPOSITORY INSTITUTION" MEANS A SUPERVISED7
LENDER OR SELLER THAT IS NOT A SUPERVISED FINANCIAL ORGANIZATION.8
SECTION 2. In Colorado Revised Statutes, 5-2-201, amend (2)9
introductory portion and (3)(a); and add (3.1), (3.3), and (3.5) as follows:10
5-2-201. Finance charge for consumer credit transactions.11
(2) With respect to a supervised loan or a consumer credit sale, except12
for a loan or sale pursuant to a revolving account
OR FOR A LOAN OR A13
CONSUMER CREDIT SALE MADE BY A NONDEPOSITORY INSTITUTION , a14
supervised lender or seller may contract for and receive a finance charge,15
calculated according to the actuarial method, not exceeding the equivalent16
of the greater of either of the following:17
(3) (a) Except as provided in paragraph (b) of this subsection (3)
18
SUBSECTION (3)(b) OF THIS SECTION, OR FOR A LOAN OR A CONSUMER19
CREDIT SALE MADE BY A NONDEPOSITORY INSTITUTION , the finance charge20
for a supervised loan or consumer credit sale pursuant to a revolving21
1148-2- credit account, calculated according to the actuarial method, may not1
exceed twenty-one percent per year on the unpaid balance of the amount2
financed.3
(3.1) W
ITH RESPECT TO A SUPERVISED LOAN OR A CONSUMER4
CREDIT SALE MADE BY A NONDEPOSITORY INSTITUTION , EXCEPT AS SET5
FORTH IN SUBSECTION (3.3) OF THIS SECTION WITH RESPECT TO A6
SUPERVISED LOAN OR CONSUMER CREDIT SALE MADE PURSUANT TO A7
REVOLVING CREDIT ACCOUNT , A SUPERVISED LENDER OR SELLER MAY8
CONTRACT FOR AND RECEIVE A FINANCE CHARGE . THE AMOUNT OF THE9
FINANCE CHARGE, CALCULATED ACCORDING TO THE ACTUARIAL METHOD ,10
MUST NOT EXCEED THE EQUIVALENT OF THE GREATER OF EITHER OF THE11
FOLLOWING:12
(a) AN AMOUNT EQUAL TO THE TOTAL OF THE FOLLOWING , MINUS13
THE TOTAL COST OF ALL ADDITIONAL CHARGES LISTED IN SUBSECTION14
(3.5) OF THIS SECTION:15
(I) THIRTY-SIX PERCENT PER YEAR ON THAT PART OF THE UNPAID16
BALANCES OF THE AMOUNT FINANCED THAT IS ONE THOUSAND DOLLARS17
OR LESS;18
(II) TWENTY-ONE PERCENT PER YEAR ON THAT PART OF THE19
UNPAID BALANCES OF THE AMOUNT FINANCED THAT IS MORE THAN ONE20
THOUSAND DOLLARS BUT DOES NOT EXCEED THREE THOUSAND DOLLARS;21
AND22
(III) FIFTEEN PERCENT PER YEAR ON THAT PART OF THE UNPAID23
BALANCES OF THE AMOUNT FINANCED THAT IS MORE THAN THREE24
THOUSAND DOLLARS; OR 25
(b) A
N AMOUNT EQUAL TO TWENTY -ONE PERCENT PER YEAR ON26
THE UNPAID BALANCES OF THE AMOUNT FINANCED , MINUS THE TOTAL27
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SECTION.2
(3.3) (a) E
XCEPT AS PROVIDED IN SUBSECTION (3.3)(b) OF THIS3
SECTION, THE TOTAL AMOUNT OF THE FINANCE CHARGE FOR A SUPERVISED4
LOAN OR CONSUMER CREDIT SALE PURSUANT TO A REVOLVING CREDIT5
ACCOUNT, CALCULATED ACCORDING TO THE ACTUARIAL METHOD , MAY6
NOT EXCEED TWENTY-ONE PERCENT PER YEAR ON THE UNPAID BALANCE7
OF THE AMOUNT FINANCED, MINUS THE TOTAL COST OF ALL ADDITIONAL8
CHARGES LISTED IN SUBSECTION (3.5) OF THIS SECTION.9
(b) N
OTWITHSTANDING SUBSECTION (3.3)(a) OF THIS SECTION, IF10
THERE IS AN UNPAID BALANCE ON THE DATE ON WHICH THE FINANCE11
CHARGE IS APPLIED, THE CREDITOR MAY CONTRACT FOR AND RECEIVE A12
MINIMUM FINANCE CHARGE NOT EXCEEDING FIFTY CENTS .13
(3.5) IF A SUPERVISED LENDER OR SELLER THAT IS A14
NONDEPOSITORY INSTITUTION CONTRACTS FOR CHARGES FOR OTHER15
BENEFITS CONFERRED ON THE CONSUMER AS DESCRIBED IN SECTION16
5-2-202 (1)(d), THE TOTAL AMOUNT OF ALL OF THE CHARGES MUST BE17
INCLUDED IN THE CALCULATION OF THE FINANCE CHARGE PURSUANT TO18
SUBSECTION (3.1) OR (3.3) OF THIS SECTION. 19
SECTION 3. In Colorado Revised Statutes, 5-2-202, amend (1)20
introductory portion and (1)(d); and repeal (1)(b), (1)(c.5), (1)(c.7), and21
(3) as follows:22
5-2-202. Additional charges. (1) S
UBJECT TO THE PROVISIONS OF23
SECTION 5-2-201 (3.5), in addition to the finance charge permitted by this24
article 2 and in a consumer lease, a creditor may contract for and receive25
the following additional charges in connection with a consumer credit26
transaction:27
1148
-4- (b) Charges for insurance as described in subsection (3) of this1
section;2
(c.5) Charges for debt cancellation contracts or debt suspension3
contracts offered in compliance with 12 CFR 37 or 12 CFR 721 or other4
federal law;5
(c.7) Charges for guaranteed asset protection agreements, as6
defined in section 5-9.3-103 (4), offered in compliance with article 9.3 of7
this title 5;8
(d) Charges for other benefits conferred on the consumer9
including insurance, if the benefits are of value to the consumer and if the10
charges are reasonable in relation to the benefits, are of a type that is not11
for credit, and are authorized as permissible additional charges by rule12
adopted by the administrator, INCLUDING:13
(I) INSURANCE WRITTEN IN CONNECTION WITH THE TRANSACTION,14
OTHER THAN INSURANCE PROTECTING THE CREDITOR AGAINST THE15
CONSUMER'S DEFAULT OR OTHER CREDIT LOSS, IF:16
(A) WITH RESPECT TO INSURANCE AGAINST LOSS OF OR DAMAGE17
TO PROPERTY OR AGAINST LIABILITY, THE CREDITOR FURNISHES A CLEAR18
AND SPECIFIC STATEMENT IN WRITING TO THE CONSUMER SETTING FORTH19
THE COST OF THE INSURANCE IF OBTAINED FROM OR THROUGH THE20
CREDITOR AND STATING THAT THE CONSUMER MAY CHOOSE THE PERSON21
THROUGH WHOM THE INSURANCE IS TO BE OBTAINED ; AND22
(B) WITH RESPECT TO CONSUMER CREDIT INSURANCE PROVIDING23
LIFE, ACCIDENT, OR HEALTH COVERAGE, THE INSURANCE COVERAGE IS NOT24
A FACTOR IN THE APPROVAL BY THE CREDITOR OF THE EXTENSION OF25
CREDIT AND THIS FACT IS CLEARLY DISCLOSED IN WRITING TO THE26
CONSUMER AND IF, IN ORDER TO OBTAIN THE INSURANCE IN CONNECTION27
1148
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AFFIRMATIVE WRITTEN INDICATION OF THE CONSUMER'S DESIRE TO DO SO2
AFTER WRITTEN DISCLOSURE TO THE CONSUMER OF THE COST OF THE3
INSURANCE;4
(II) CHARGES FOR DEBT CANCELLATION CONTRACTS OR DEBT5
SUSPENSION CONTRACTS OFFERED IN COMPLIANCE WITH 12 CFR 37 OR 126
CFR 721 OR OTHER FEDERAL LAW;7
(III) CHARGES FOR GUARANTEED ASSET PROTECTION8
AGREEMENTS, AS DEFINED IN SECTION 5-9.3-101 (4), OFFERED IN9
COMPLIANCE WITH ARTICLE 9.3 OF THIS TITLE 5;10
(IV) FOR INSURANCE NOT COVERED UNDER SUBSECTION (1)(d)(I)11
OF THIS SECTION, ANY CREDIT INSURANCE PREMIUM OR FEE, ANY CHARGE12
FOR SINGLE PREMIUM CREDIT INSURANCE , ANY FEE FOR A DEBT13
CANCELLATION CONTRACT, OR ANY FEE FOR A DEBT SUSPENSION14
AGREEMENT; AND15
(V) ANY FEE FOR A CREDIT-RELATED ANCILLARY PRODUCT SOLD16
IN CONNECTION WITH THE CREDIT TRANSACTION ; AND17
(3) An additional charge may be made for insurance written in18
connection with the transaction, other than insurance protecting the19
creditor against the consumer's default or other credit loss, if:20
(a) With respect to insurance against loss of or damage to property21
or against liability, the creditor furnishes a clear and specific statement in22
writing to the consumer setting forth the cost of the insurance if obtained23
from or through the creditor and stating that the consumer may choose the24
person through whom the insurance is to be obtained; and25
(b) With respect to consumer credit insurance providing life,26
accident, or health coverage, the insurance coverage is not a factor in the27
1148
-6- approval by the creditor of the extension of credit and this fact is clearly1
disclosed in writing to the consumer and if, in order to obtain the2
insurance in connection with the extension of credit, the consumer gives3
specific affirmative written indication of the consumer's desire to do so4
after written disclosure to the consumer of the cost thereof.5
SECTION 4. In Colorado Revised Statutes, 5-6-104, amend (2)6
as follows:7
5-6-104. Powers of administrator - harmony with federal8
regulations - reliance on rules. (2) The administrator may adopt rules9
not inconsistent with the federal "Truth in Lending Act" and federal10
"Consumer Leasing Act" to assure a meaningful disclosure of credit terms11
so that a prospective consumer will be able to compare more readily the12
various credit terms available to him or her THE CONSUMER and to avoid13
the uninformed use of credit. Such rules shall supersede any provisions14
of this code that are inconsistent with the federal "Truth in Lending Act"15
and federal "Consumer Leasing Act", may contain classifications,16
differentiations, or other provisions and may provide for adjustments and17
exceptions for any class of transactions subject to this code that, in the18
judgment of the administrator, are necessary or proper to effectuate the19
purposes of, or to prevent circumvention or evasion of, or to facilitate20
compliance with, the provisions of this code relating to disclosure of21
credit terms.22
SECTION 5. Act subject to petition - effective date. This act23
takes effect at 12:01 a.m. on the day following the expiration of the24
ninety-day period after final adjournment of the general assembly; except25
that, if a referendum petition is filed pursuant to section 1 (3) of article V26
of the state constitution against this act or an item, section, or part of this27
1148
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effect unless approved by the people at the general election to be held in2
November 2024 and, in such case, will take effect on the date of the3
official declaration of the vote thereon by the governor.4
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