Indiana 2022 Regular Session

Indiana Senate Bill SB0352 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	~~SB0352.1~~
2		-	~~January 21, 2022~~
	1	+
	2	+	Introduced Version
3	3		SENATE BILL No. 352
4	4		_____
5		-	DIGEST OF ~~SB 352 (Updated January 20, 2022 7:43 pm - DI 55)~~
6		-	Citations Affected: IC 24-4.5; IC 28-7; IC 35-45.
	5	+	DIGEST OF INTRODUCED BILL
	6	+	Citations Affected: IC 24-4.5; IC 28-7-5-28; IC 35-45-7-2.
7	7		Synopsis: Supervised consumer loans. Amends the Uniform
8	8		Consumer Credit Code to provide that the authorized loan finance
9	9		charge for a consumer loan, other than a supervised loan, that is
10	10		entered into after June 30, 2022, may not exceed 36% (versus 25% for
11	11		a consumer loan that is entered into before July 1, 2022) per year on the
12	12		unpaid balances of the principal. Amends the definition of "supervised
13	13		loan" to mean a consumer loan that: (1) is entered into before July 1,
14	14		2022, and with respect to which the rate of the loan finance charge
15	15		exceeds the authorized 25% annual rate for consumer loans under
16	16		current law; or (2) is entered into after June 30, 2022, and is made in
17	17		accordance with the requirements for supervised loans set forth in the
18	18		bill. Sets forth requirements and limitations with respect to the
19	19		following for supervised loans made after June 30, 2022: (1)
20	20		Authorized fees and charges. (2) The maximum principal amount. (3)
21	21		The minimum and maximum lengths of the loan term. (4) Information
22	22		and disclosures to be included in the loan contract. (5) A borrower's
23	23		right to rescind a supervised loan transaction. Provides that when a
24	24		borrower enters into a supervised loan, the lender shall provide the
25	25		borrower with a pamphlet approved by the department of financial
26		-	(Continued next page)
27		-	Effective: July 1, 2022.
28		-	Zay, Bohacek
29		-	January 11, 2022, read first time and referred to Committee on Insurance and Financial
30		-	Institutions.
31		-	January 20, 2022, amended, reported favorably — Do Pass.
32		-	SB 352—LS 6946/DI 101 Digest Continued
33	26		institutions (department) that describes: (1) the availability of debt
34	27		management and credit counseling services; (2) the borrower's rights
35	28		and responsibilities; and (3) the availability of the 211 telephone
36	29		dialing code for human services information and referrals. Sets forth
37	30		prohibited acts and practices in connection with a supervised loan.
38	31		Provides that a lender may not take a security interest in real or
39	32		personal property in connection with a supervised loan, other than a
	33	+	(Continued next page)
	34	+	Effective: July 1, 2022.
	35	+	Zay
	36	+	January 11, 2022, read first time and referred to Committee on Insurance and Financial
	37	+	Institutions.
	38	+	2022 IN 352—LS 6946/DI 101 Digest Continued
40	39		security interest in a personal check of the borrower. Specifies the
41	40		applicability of the bill's provisions to supervised loans made by
42	41		persons exempt from: (1) the bill's finance charge limitations; and (2)
43	42		licensure by the department. Requires a lender that makes at least one
44	43		supervised loan in Indiana during a calendar year to remit to the
45	44		department: (1) an annual fee of $250; and (2) an additional fee of
46	45		$250 per Indiana branch location (after the first location). Establishes
47	46		the consumer financial education fund (fund), and provides that the
48	47		annual fees collected from lenders making supervised loans are to be
49	48		deposited in the fund. Provides that the fund is to be: (1) administered
50	49		by the department; and (2) used by the department for paying expenses
51	50		relating to consumer financial education. Requires a person that enters
52	51		into at least one supervised loan transaction in Indiana in any calendar
53	52		year to file with the department a report concerning the person's
54	53		business and operations with respect to that calendar year. Requires the
55	54		director of the department to prescribe: (1) the time and manner for
56	55		filing the report; and (2) the information to be included in the report.
57	56		Requires the department to publish and make available to the public,
58	57		at least annually, an analysis of the information provided in the reports
59	58		filed with the department. Sets forth the information that must be
60	59		included in the department's analysis. Makes conforming amendments
61	60		to existing references to supervised loans throughout the Indiana Code.
62		-	SB 352—LS 6946/DI ~~101SB~~ 352—LS 6946/DI 101 ~~January 21, 2022~~
	61	+	2022 IN 352—LS 6946/DI 1012022 IN 352—LS 6946/DI 101 Introduced
63	62		Second Regular Session of the 122nd General Assembly (2022)
64	63		PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
65	64		Constitution) is being amended, the text of the existing provision will appear in this style type,
66	65		additions will appear in this style type, and deletions will appear in this style type.
67	66		Additions: Whenever a new statutory provision is being enacted (or a new constitutional
68	67		provision adopted), the text of the new provision will appear in this style type. Also, the
69	68		word NEW will appear in that style type in the introductory clause of each SECTION that adds
70	69		a new provision to the Indiana Code or the Indiana Constitution.
71	70		Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts
72	71		between statutes enacted by the 2021 Regular Session of the General Assembly.
73	72		SENATE BILL No. 352
74	73		A BILL FOR AN ACT to amend the Indiana Code concerning trade
75	74		regulation and to make an appropriation.
76	75		Be it enacted by the General Assembly of the State of Indiana:
77	76		1 SECTION 1. IC 24-4.5-3-109 IS AMENDED TO READ AS
78	77		2 FOLLOWS [EFFECTIVE JULY 1, 2022]: Sec. 109. (1) "Loan finance
79	78		3 charge" means the sum of:
80	79		4 (a) all charges payable directly or indirectly by the debtor and
81	80		5 imposed directly or indirectly by the lender as an incident to the
82	81		6 extension of credit, including any of the following types of
83	82		7 charges which are applicable: interest or any amount payable
84	83		8 under a point, discount, or other system of charges, however
85	84		9 denominated, premium or other charge for any guarantee or
86	85		10 insurance protecting the lender against the debtor's default or
87	86		11 other credit loss; and
88	87		12 (b) charges incurred for investigating the collateral or
89	88		13 credit-worthiness of the debtor.
90	89		14 The term does not include charges as a result of default, additional
91		-	SB 352—LS 6946/DI 101 2
92		-	1 charges (IC 24-4.5-3-202), delinquency charges (IC 24-4.5-3-203.5),
93		-	2 or deferral charges (IC 24-4.5-3-204). With respect to a supervised
94		-	3 loan made under section 508.1 of this chapter after June 30, 2022,
95		-	4 the term does not include the fees and charges set forth in section
96		-	5 508.1(2)(b) through section 508.1(2)(e) of this chapter. The term
97		-	6 does not include charges paid or payable to a third party that are not
98		-	7 required by the lender as a condition or incident to the extension of
99		-	8 credit except for borrower paid mortgage broker fees, including fees
100		-	9 paid directly to the broker or the lender (for delivery to the broker),
101		-	10 whether the fees are paid in cash or financed. However, borrower paid
102		-	11 mortgage broker fees do not include fees paid to a mortgage broker by
103		-	12 a creditor, including yield spread premiums and service release fees.
104		-	13 (2) If a lender makes a loan to a debtor by purchasing or satisfying
105		-	14 obligations of the debtor pursuant to a lender credit card or similar
106		-	15 arrangement, and the purchase or satisfaction is made at less than the
107		-	16 face amount of the obligation, the discount is not part of the loan
108		-	17 finance charge.
109		-	18 SECTION 2. IC 24-4.5-3-201, AS AMENDED BY P.L.85-2020,
110		-	19 SECTION 10, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
111		-	20 JULY 1, 2022]: Sec. 201. Loan Finance Charge for Consumer Loans
112		-	21 other than Supervised Loans—(1) Except as provided in subsections
113		-	22 (7) and (9), with respect to a consumer loan, other than a supervised
114		-	23 loan (as defined in section 501 of this chapter), a lender may contract
115		-	24 for a loan finance charge, calculated according to the actuarial method,
116		-	25 not exceeding the following:
117		-	26 (a) Twenty-five percent (25%) per year on the unpaid balances of
118		-	27 the principal (as defined in section 107(3) of this chapter), in the
119		-	28 case of a loan agreement entered into before July 1, 2022.
120		-	29 (b) Subject to subsection (3), thirty-six percent (36%) per year
121		-	30 on the unpaid balances of the principal (as defined in section
122		-	31 107(3) of this chapter), in the case of a loan agreement entered
123		-	32 into after June 30, 2022.
124		-	33 (2) In the case of a loan agreement entered into before July 1, 2020,
125		-	34 this section does not limit or restrict the manner of contracting for the
126		-	35 loan finance charge, whether by way of add-on, discount, or otherwise,
127		-	36 so long as the rate of the loan finance charge does not exceed that
128		-	37 permitted by this section. If the loan is precomputed:
129		-	38 (a) the loan finance charge may be calculated on the assumption
130		-	39 that all scheduled payments will be made when due; and
131		-	40 (b) the effect of prepayment is governed by the provisions on
132		-	41 rebate upon prepayment in section 210 of this chapter.
133		-	42 (3) The following apply to a loan agreement for a consumer loan (or
134		-	SB 352—LS 6946/DI 101 3
135		-	1 for the refinancing or consolidation of a consumer loan) that is entered
136		-	2 into after June 30, 2020:
137		-	3 (a) The consumer loan is subject to this section, including the
138		-	4 limitations set forth in:
139		-	5 (i) subsection (1) with respect to the loan finance charge; and
140		-	6 (ii) subsection (9)(b) with respect to the amount of the
141		-	7 authorized nonrefundable prepaid finance charge, in the case
142		-	8 of a consumer loan that is not secured by an interest in land.
143		-	9 (b) The loan finance charge authorized by this section must be:
144		-	10 (i) contracted for between the lender and the debtor; and
145		-	11 (ii) calculated by applying a rate not exceeding the rate set
146		-	12 forth in subsection (1) to unpaid balances of the principal (as
147		-	13 defined in section 107(3) of this chapter).
148		-	14 (c) A loan agreement for a precomputed consumer loan is
149		-	15 prohibited.
	90	+	15 charges (IC 24-4.5-3-202), delinquency charges (IC 24-4.5-3-203.5),
	91	+	2022 IN 352—LS 6946/DI 101 2
	92	+	1 or deferral charges (IC 24-4.5-3-204). With respect to a supervised
	93	+	2 loan made under section 508.1 of this chapter after June 30, 2022,
	94	+	3 the term does not include the fees and charges set forth in section
	95	+	4 508.1(2)(b) through section 508.1(2)(e) of this chapter. The term
	96	+	5 does not include charges paid or payable to a third party that are not
	97	+	6 required by the lender as a condition or incident to the extension of
	98	+	7 credit except for borrower paid mortgage broker fees, including fees
	99	+	8 paid directly to the broker or the lender (for delivery to the broker),
	100	+	9 whether the fees are paid in cash or financed. However, borrower paid
	101	+	10 mortgage broker fees do not include fees paid to a mortgage broker by
	102	+	11 a creditor, including yield spread premiums and service release fees.
	103	+	12 (2) If a lender makes a loan to a debtor by purchasing or satisfying
	104	+	13 obligations of the debtor pursuant to a lender credit card or similar
	105	+	14 arrangement, and the purchase or satisfaction is made at less than the
	106	+	15 face amount of the obligation, the discount is not part of the loan
	107	+	16 finance charge.
	108	+	17 SECTION 2. IC 24-4.5-3-201, AS AMENDED BY P.L.85-2020,
	109	+	18 SECTION 10, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
	110	+	19 JULY 1, 2022]: Sec. 201. Loan Finance Charge for Consumer Loans
	111	+	20 other than Supervised Loans—(1) Except as provided in subsections
	112	+	21 (7) and (9), with respect to a consumer loan, other than a supervised
	113	+	22 loan (as defined in section 501 of this chapter), a lender may contract
	114	+	23 for a loan finance charge, calculated according to the actuarial method,
	115	+	24 not exceeding the following:
	116	+	25 (a) Twenty-five percent (25%) per year on the unpaid balances of
	117	+	26 the principal (as defined in section 107(3) of this chapter), in the
	118	+	27 case of a loan agreement entered into before July 1, 2022.
	119	+	28 (b) Subject to subsection (3), thirty-six percent (36%) per year
	120	+	29 on the unpaid balances of the principal (as defined in section
	121	+	30 107(3) of this chapter), in the case of a loan agreement entered
	122	+	31 into after June 30, 2022.
	123	+	32 (2) In the case of a loan agreement entered into before July 1, 2020,
	124	+	33 this section does not limit or restrict the manner of contracting for the
	125	+	34 loan finance charge, whether by way of add-on, discount, or otherwise,
	126	+	35 so long as the rate of the loan finance charge does not exceed that
	127	+	36 permitted by this section. If the loan is precomputed:
	128	+	37 (a) the loan finance charge may be calculated on the assumption
	129	+	38 that all scheduled payments will be made when due; and
	130	+	39 (b) the effect of prepayment is governed by the provisions on
	131	+	40 rebate upon prepayment in section 210 of this chapter.
	132	+	41 (3) The following apply to a loan agreement for a consumer loan (or
	133	+	42 for the refinancing or consolidation of a consumer loan) that is entered
	134	+	2022 IN 352—LS 6946/DI 101 3
	135	+	1 into after June 30, 2020:
	136	+	2 (a) The consumer loan is subject to this section, including the
	137	+	3 limitations set forth in:
	138	+	4 (i) subsection (1) with respect to the loan finance charge; and
	139	+	5 (ii) subsection (9)(b) with respect to the amount of the
	140	+	6 authorized nonrefundable prepaid finance charge, in the case
	141	+	7 of a consumer loan that is not secured by an interest in land.
	142	+	8 (b) The loan finance charge authorized by this section must be:
	143	+	9 (i) contracted for between the lender and the debtor; and
	144	+	10 (ii) calculated by applying a rate not exceeding the rate set
	145	+	11 forth in subsection (1) to unpaid balances of the principal (as
	146	+	12 defined in section 107(3) of this chapter).
	147	+	13 (c) A loan agreement for a precomputed consumer loan is
	148	+	14 prohibited, other than in the case of a supervised loan made
	149	+	15 under section 508.1 of this chapter after June 30, 2022.
150	150		16 (d) Subject to subsection (12), in addition to the loan finance
151	151		17 charge authorized by subsection (1) and to any other fees
152	152		18 permitted by this chapter, and not subject to the twenty-five
153	153		19 percent (25%) applicable rate set forth in subsection (1), the
154	154		20 lender may contract for and receive as a condition for, or an
155	155		21 incident to, the extension of credit a nonrefundable prepaid
156	156		22 finance charge under subsection (9), whether the charge is:
157	157		23 (i) paid separately in cash or by check before or at
158	158		24 consummation; or
159	159		25 (ii) withheld from the proceeds of the consumer loan.
160	160		26 (4) For the purposes of this section, the term of a loan commences
161	161		27 with the date the loan is made. Differences in the lengths of months are
162	162		28 disregarded, and a day may be counted as one-thirtieth (1/30) of a
163	163		29 month. Subject to classifications and differentiations the lender may
164	164		30 reasonably establish, a part of a month in excess of fifteen (15) days
165	165		31 may be treated as a full month if periods of fifteen (15) days or less are
166	166		32 disregarded and if that procedure is not consistently used to obtain a
167	167		33 greater yield than would otherwise be permitted. For purposes of
168	168		34 computing average daily balances, the creditor may elect to treat all
169	169		35 months as consisting of thirty (30) days.
170	170		36 (5) With respect to a consumer loan made pursuant to a revolving
171	171		37 loan account:
172	172		38 (a) the loan finance charge shall be deemed not to exceed the
173	173		39 maximum annual percentage rate if the loan finance charge
174	174		40 contracted for and received does not exceed a charge in each
175	175		41 monthly billing cycle which is either two and eighty-three
176	176		42 thousandths percent (2.083%), in the case of a loan agreement
177		-	SB 352—LS 6946/DI 101 4
	177	+	2022 IN 352—LS 6946/DI 101 4
178	178		1 described in subsection (1)(a), or three percent (3%), in the
179	179		2 case of a loan agreement described in subsection (1)(b), of an
180	180		3 amount not greater than:
181	181		4 (i) the average daily balance of the debt;
182	182		5 (ii) the unpaid balance of the debt on the same day of the
183	183		6 billing cycle; or
184	184		7 (iii) subject to subsection (6), the median amount within a
185	185		8 specified range within which the average daily balance or the
186	186		9 unpaid balance of the debt, on the same day of the billing
187	187		10 cycle, is included; for the purposes of this clause and clause
188	188		11 (ii), a variation of not more than four (4) days from month to
189	189		12 month is "the same day of the billing cycle";
190	190		13 (b) if the billing cycle is not monthly, the loan finance charge
191	191		14 shall be deemed not to exceed the maximum annual percentage
192	192		15 rate if the loan finance charge contracted for and received does
193	193		16 not exceed a percentage which bears the same relation to
194	194		17 one-twelfth (1/12) the maximum annual percentage rate as the
195	195		18 number of days in the billing cycle bears to thirty (30); and
196	196		19 (c) notwithstanding subsection (1), if there is an unpaid balance
197	197		20 on the date as of which the loan finance charge is applied, the
198	198		21 lender may contract for and receive a charge not exceeding fifty
199	199		22 cents ($0.50) if the billing cycle is monthly or longer, or the pro
200	200		23 rata part of fifty cents ($0.50) which bears the same relation to
201	201		24 fifty cents ($0.50) as the number of days in the billing cycle bears
202	202		25 to thirty (30) if the billing cycle is shorter than monthly, but no
203	203		26 charge may be made pursuant to this subdivision if the lender has
204	204		27 made an annual charge for the same period as permitted by the
205	205		28 provisions on additional charges in section 202(1)(c) of this
206	206		29 chapter.
207	207		30 (6) Subject to classifications and differentiations the lender may
208	208		31 reasonably establish, the lender may make the same loan finance
209	209		32 charge on all amounts financed within a specified range. A loan finance
210	210		33 charge does not violate subsection (1) if:
211	211		34 (a) when applied to the median amount within each range, it does
212	212		35 not exceed the maximum permitted by subsection (1); and
213	213		36 (b) when applied to the lowest amount within each range, it does
214	214		37 not produce a rate of loan finance charge exceeding the rate
215	215		38 calculated according to subdivision (a) by more than eight percent
216	216		39 (8%) of the rate calculated according to subdivision (a).
217	217		40 (7) With respect to a consumer loan not made pursuant to a
218	218		41 revolving loan account, the lender may contract for and receive a
219	219		42 minimum loan finance charge of not more than thirty dollars ($30). The
220		-	SB 352—LS 6946/DI 101 5
	220	+	2022 IN 352—LS 6946/DI 101 5
221	221		1 minimum loan finance charge allowed under this subsection may be
222	222		2 imposed only if the lender does not contract for or receive a
223	223		3 nonrefundable prepaid finance charge under subsection (9) and:
224	224		4 (a) the debtor prepays in full a consumer loan, refinancing, or
225	225		5 consolidation, regardless of whether the loan, refinancing, or
226	226		6 consolidation is precomputed;
227	227		7 (b) the loan, refinancing, or consolidation prepaid by the debtor
228	228		8 is subject to a loan finance charge that:
229	229		9 (i) is contracted for by the parties; and
230	230		10 (ii) does not exceed the rate prescribed in subsection (1); and
231	231		11 (c) the loan finance charge earned at the time of prepayment is
232	232		12 less than the minimum loan finance charge contracted for under
233	233		13 this subsection.
234	234		14 (8) The amount of thirty dollars ($30) in subsection (7) is subject to
235		-	15 change under the provisions on adjustment of dollar amounts
236		-	16 ~~(IC~~ 24-4.5-1-106). However, notwithstanding IC 24-4.5-1-106(1), the
	235	+	15 change under the provisions on adjustment of dollar amounts (IC
	236	+	16 24-4.5-1-106). However, notwithstanding IC 24-4.5-1-106(1), the
237	237		17 Reference Base Index to be used under this subsection is the Index for
238	238		18 October 1992.
239	239		19 (9) Except as provided in subsection (7), and subject to subsection
240	240		20 (12), in addition to the loan finance charge authorized by subsection (1)
241	241		21 and to any other charges and fees permitted by this chapter, a lender
242	242		22 may contract for and receive a nonrefundable prepaid finance charge
243	243		23 of not more than the following:
244	244		24 (a) In the case of a consumer loan that is secured by an interest in
245	245		25 land and that:
246	246		26 (i) is not made under a revolving loan account, two percent
247	247		27 (2%) of the loan amount; or
248	248		28 (ii) is made under a revolving loan account, two percent (2%)
249	249		29 of the line of credit.
250	250		30 (b) In the case of consumer loan that is not secured by an interest
251	251		31 in land, fifty dollars ($50) if the loan agreement is entered into
252	252		32 before July 1, 2020. If the loan agreement is entered into after
253	253		33 June 30, 2020, not more than the following:
254	254		34 (i) Seventy-five dollars ($75), in the case of a loan agreement
255	255		35 for a principal amount which is two thousand dollars ($2,000)
256	256		36 or less.
257	257		37 (ii) One hundred fifty dollars ($150) in the case of a loan
258	258		38 agreement for a principal amount which is more than two
259	259		39 thousand dollars ($2,000) but does not exceed four thousand
260	260		40 dollars ($4,000).
261	261		41 (iii) Two hundred dollars ($200) in the case of a loan
262	262		42 agreement for a principal amount which is more than four
263		-	SB 352—LS 6946/DI 101 6
	263	+	2022 IN 352—LS 6946/DI 101 6
264	264		1 thousand dollars ($4,000).
265	265		2 The amounts in this subsection are not subject to change under
266	266		3 IC 24-4.5-1-106.
267	267		4 (10) The nonrefundable prepaid finance charge provided for in
268	268		5 subsection (9) is not subject to refund or rebate. However, for any loan
269	269		6 entered into after June 30, 2020, any amount charged by the lender,
270	270		7 other than by a lender that is a depository institution (as defined in
271	271		8 IC 24-4.5-1-301.5(12)), under subsection (9) that exceeds the
272	272		9 applicable amount permitted by subsection (9)(b) constitutes a
273	273		10 violation of this article under IC 24-4.5-6-107.5(l) and is subject to
274	274		11 refund. Any amount charged by a depository institution (as defined in
275	275		12 IC 24-4.5-1-301.5(12)) under subsection (9) that exceeds the applicable
276	276		13 amount set forth in subsection (9)(b) is subject to refund.
277	277		14 (11) If the director determines that a lender's accrual method of
278	278		15 accounting as applied to a consumer loan under this section involves
279	279		16 the application of subterfuge for the purpose of circumventing this
280	280		17 chapter, the director may conform the loan finance charge and fees for
281	281		18 the transaction to the limitations set forth in this section and may
282	282		19 require a refund of overcharges under IC 24-4.5-6-106(2)(a). A
283	283		20 determination by the director under this subsection:
284	284		21 (a) must be in writing;
285	285		22 (b) shall be delivered to all parties in the transaction; and
286	286		23 (c) is subject to IC 4-21.5-3.
287	287		24 (12) At the time of consummation of a consumer loan:
288	288		25 (a) the loan finance charge authorized by subsection (1); and
289	289		26 (b) the nonrefundable prepaid finance charge authorized by
290	290		27 subsection (9) (including any amount charged by a depository
291	291		28 institution (as defined in IC 24-4.5-1-301.5(12)) that exceeds the
292	292		29 applicable amount set forth in subsection (9)(b));
293	293		30 are subject to IC 35-45-7 and, when combined, may not exceed the rate
294	294		31 set forth in IC 35-45-7-2.
295	295		32 (13) Notwithstanding subsections (9) and (10), in the case of a
296	296		33 consumer loan that is not secured by an interest in land, if a lender
297	297		34 retains any part of a nonrefundable prepaid finance charge charged on
298	298		35 a loan that is paid in full by a new loan from the same lender, the
299	299		36 following apply:
300	300		37 (a) If the loan is paid in full by the new loan within three (3)
301	301		38 months after the date of the prior loan, the lender may not charge
302	302		39 a nonrefundable prepaid finance charge on the new loan, or, in the
303	303		40 case of a revolving loan, on the increased credit line.
304	304		41 (b) The lender may not assess more than two (2) nonrefundable
305	305		42 prepaid finance charges in any twelve (12) month period.
306		-	SB 352—LS 6946/DI 101 7
	306	+	2022 IN 352—LS 6946/DI 101 7
307	307		1 (c) Subject to subdivisions (a) and (b), if a loan that is entered
308	308		2 into by a lender and a debtor before July 1, 2020, is paid in full by
309	309		3 a new loan from the same lender after June 30, 2020, the lender
310	310		4 may contract for and receive a nonrefundable prepaid finance
311	311		5 charge in the amount set forth in subsection (9)(b) for loan
312	312		6 agreements entered into after June 30, 2020.
313	313		7 (14) In the case of a consumer loan that is secured by an interest in
314	314		8 land, this section does not prohibit a lender from contracting for and
315	315		9 receiving a fee for preparing deeds, mortgages, reconveyances, and
316	316		10 similar documents under section 202(1)(d)(ii) of this chapter, in
317	317		11 addition to the nonrefundable prepaid finance charge provided for in
318	318		12 subsection (9).
319		-	13 SECTION 3. IC 24-4.5-3-205, AS AMENDED BY P.L.85-2020,
320		-	14 SECTION 12, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
321		-	15 JULY 1, 2022]: Sec. 205. Loan Finance Charge on Refinancing —
322		-	16 With respect to a consumer loan, refinancing, or consolidation, the
323		-	17 lender may by agreement with the debtor refinance the unpaid balance
324		-	18 and may contract for and receive a loan finance charge based on the
325		-	19 principal resulting from the refinancing at a rate not exceeding that
326		-	20 permitted by the provisions on a loan finance charge for consumer
327		-	21 loans (IC 24-4.5-3-201) or the provisions on a loan finance charge for
328		-	22 supervised loans (IC 24-4.5-3-508), (section 508 of this chapter, for
329		-	23 supervised loans made before July 1, 2022, or section 508.1 of this
330		-	24 chapter, for supervised loans made after June 30, 2022), whichever
331		-	25 is appropriate. For the purpose of determining the loan finance charge
332		-	26 permitted, the principal resulting from the refinancing comprises the
333		-	27 following:
334		-	28 (a) If:
335		-	29 (i) the transaction was not precomputed, the total of the unpaid
336		-	30 balance and the accrued charges on the date of the refinancing;
	319	+	13 SECTION 3. IC 24-4.5-3-203.5, AS AMENDED BY P.L.129-2020,
	320	+	14 SECTION 6, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
	321	+	15 JULY 1, 2022]: Sec. 203.5. Delinquency Charges — (1) With respect
	322	+	16 to a consumer loan, refinancing, or consolidation, the parties may
	323	+	17 contract for a delinquency charge of not more than the following:
	324	+	18 (a) Five dollars ($5) on any installment or minimum payment due
	325	+	19 that is not paid in full not later than ten (10) days after its
	326	+	20 scheduled due date, in the case of a consumer loan, refinancing,
	327	+	21 or consolidation that is made before July 1, 2019. The amount of
	328	+	22 five dollars ($5) in this subdivision is subject to change under
	329	+	23 IC 24-4.5-1-106. In addition, the parties may provide by contract
	330	+	24 for a delinquency charge that is subject to change. If the parties
	331	+	25 provide by contract for a delinquency charge that is subject to
	332	+	26 change, the lender shall disclose in the contract that the amount
	333	+	27 of the delinquency charge is subject to change under
	334	+	28 IC 24-4.5-1-106 or this section.
	335	+	29 (b) In the case of a consumer loan, refinancing, or consolidation
	336	+	30 that is made after June 30, 2019, the following:
	337	+	31 (i) Five dollars ($5) on any installment or minimum payment
	338	+	32 due that is not paid in full not later than ten (10) days after its
	339	+	33 scheduled due date, if installments under the consumer loan,
	340	+	34 refinancing, or consolidation are due every fourteen (14) days
	341	+	35 or less. The amount of five dollars ($5) in this clause is not
	342	+	36 subject to change under IC 24-4.5-1-106.
	343	+	37 (ii) Twenty-five dollars ($25) on any installment or minimum
	344	+	38 payment due that is not paid in full not later than ten (10) days
	345	+	39 after its scheduled due date, if installments under the
	346	+	40 consumer loan, refinancing, or consolidation are due every
	347	+	41 fifteen (15) days or more. The amount of twenty-five dollars
	348	+	42 ($25) in this clause is not subject to change under
	349	+	2022 IN 352—LS 6946/DI 101 8
	350	+	1 IC 24-4.5-1-106.
	351	+	2 (iii) Twenty-five dollars ($25) on any installment or minimum
	352	+	3 payment due that is not paid in full not later than ten (10) days
	353	+	4 after its scheduled due date, in the case of a consumer loan,
	354	+	5 refinancing, or consolidation that is payable in a single
	355	+	6 installment that is due at least thirty (30) days after the
	356	+	7 consumer loan, refinancing, or consolidation is made. The
	357	+	8 amount of twenty-five dollars ($25) in this clause is not
	358	+	9 subject to change under IC 24-4.5-1-106.
	359	+	10 (2) A delinquency charge under this section may be collected only
	360	+	11 once on an installment however long it remains in default. With regard
	361	+	12 to a delinquency charge on consumer loans made under a revolving
	362	+	13 loan account, the delinquency charge may be applied each month that
	363	+	14 the payment is less than the minimum required payment on the
	364	+	15 account. A delinquency charge may be collected any time after it
	365	+	16 accrues. A delinquency charge may not be collected if:
	366	+	17 (a) the installment has been deferred and a deferral charge (IC
	367	+	18 24-4.5-3-204) has been paid or incurred;
	368	+	19 (b) a charge for a skip-a-payment service under
	369	+	20 IC 24-4.5-3-202(1)(i) has been paid or incurred, as provided in
	370	+	21 IC 24-4.5-3-202(1)(i)(iii); or
	371	+	22 (c) a charge for an optional expedited payment service under
	372	+	23 IC 24-4.5-3-202(1)(j) has been paid or incurred, as provided in
	373	+	24 IC 24-4.5-3-202(1)(j)(v).
	374	+	25 (3) A creditor may not, directly or indirectly, charge or collect a
	375	+	26 delinquency charge on a payment that:
	376	+	27 (a) is paid not later than ten (10) days after its scheduled due date;
	377	+	28 and
	378	+	29 (b) is otherwise a full payment of the payment due for the
	379	+	30 applicable installment period;
	380	+	31 if the only delinquency with respect to the consumer loan, refinancing,
	381	+	32 or consolidation is attributable to a delinquency charge assessed on an
	382	+	33 earlier installment.
	383	+	34 (4) This subsection does not apply to a supervised loan made
	384	+	35 under section 508.1 of this chapter after June 30, 2022. If two (2) or
	385	+	36 more installments, or parts of two (2) or more installments, of a
	386	+	37 precomputed loan are in default for ten (10) days or more, the lender
	387	+	38 may elect to convert the loan from a precomputed loan to a loan in
	388	+	39 which the finance charge is based on unpaid balances. A lender that
	389	+	40 makes this election shall make a rebate under the provisions on rebates
	390	+	41 upon prepayment (IC 24-4.5-3-210) as of the maturity date of the first
	391	+	42 delinquent installment, and thereafter may make a loan finance charge
	392	+	2022 IN 352—LS 6946/DI 101 9
	393	+	1 as authorized by the provisions on loan finance charges for consumer
	394	+	2 loans (IC 24-4.5-3-201) or, in the case of supervised loans made
	395	+	3 before July 1, 2022, supervised loans (IC 24-4.5-3-508). The amount
	396	+	4 of the rebate shall not be reduced by the amount of any permitted
	397	+	5 minimum charge (IC 24-4.5-3-210). Any deferral charges made on
	398	+	6 installments due at or after the maturity date of the first delinquent
	399	+	7 installment shall be rebated, and no further deferral charges shall be
	400	+	8 made.
	401	+	9 SECTION 4. IC 24-4.5-3-205, AS AMENDED BY P.L.85-2020,
	402	+	10 SECTION 12, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
	403	+	11 JULY 1, 2022]: Sec. 205. Loan Finance Charge on Refinancing —
	404	+	12 With respect to a consumer loan, refinancing, or consolidation, the
	405	+	13 lender may by agreement with the debtor refinance the unpaid balance
	406	+	14 and may contract for and receive a loan finance charge based on the
	407	+	15 principal resulting from the refinancing at a rate not exceeding that
	408	+	16 permitted by the provisions on a loan finance charge for consumer
	409	+	17 loans (IC 24-4.5-3-201) or the provisions on a loan finance charge for
	410	+	18 supervised loans (IC 24-4.5-3-508), (section 508 of this chapter, for
	411	+	19 supervised loans made before July 1, 2022, or section 508.1 of this
	412	+	20 chapter, for supervised loans made after June 30, 2022), whichever
	413	+	21 is appropriate. For the purpose of determining the loan finance charge
	414	+	22 permitted, the principal resulting from the refinancing comprises the
	415	+	23 following:
	416	+	24 (a) If:
	417	+	25 (i) the transaction was not precomputed, the total of the unpaid
	418	+	26 balance and the accrued charges on the date of the refinancing;
	419	+	27 or
	420	+	28 (ii) the transaction was precomputed in the case of a
	421	+	29 transaction and was entered into before July 1, 2020, or if the
	422	+	30 transaction was for a supervised loan made under section
	423	+	31 508.1 of this chapter after June 30, 2022, the amount which
	424	+	32 the debtor would have been required to pay upon prepayment
	425	+	33 pursuant to the provisions on rebate upon prepayment (IC
	426	+	34 24-4.5-3-210) (section 210 of this chapter) on the date of
	427	+	35 refinancing.
	428	+	36 (b) Appropriate additional charges (IC 24-4.5-3-202), payment of
	429	+	37 which is deferred.
	430	+	38 SECTION 5. IC 24-4.5-3-206, AS AMENDED BY P.L.85-2020,
	431	+	39 SECTION 13, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
	432	+	40 JULY 1, 2022]: Sec. 206. Loan Finance Charge on Consolidation —
	433	+	41 (1) If a debtor owes an unpaid balance to a lender with respect to a
	434	+	42 consumer loan, refinancing, or consolidation, and becomes obligated
	435	+	2022 IN 352—LS 6946/DI 101 10
	436	+	1 on another consumer loan, refinancing, or consolidation with the same
	437	+	2 lender, the parties may agree to a consolidation resulting in a single
	438	+	3 schedule of payments. If the previous consumer loan, refinancing, or
	439	+	4 consolidation was not precomputed, the parties may agree to add the
	440	+	5 unpaid amount of principal and accrued charges on the date of
	441	+	6 consolidation to the principal with respect to the subsequent loan. If the
	442	+	7 previous consumer loan, refinancing, or consolidation was
	443	+	8 precomputed in the case of a transaction and was entered into before
	444	+	9 July 1, 2020, or if the previous transaction was made under section
	445	+	10 508.1 of this chapter after June 30, 2022, the parties may agree to
	446	+	11 refinance the unpaid balance pursuant to the provisions on refinancing
	447	+	12 (IC 24-4.5-3-205) and to consolidate the principal resulting from the
	448	+	13 refinancing by adding it to the principal with respect to the subsequent
	449	+	14 loan. In either case the lender may contract for and receive a loan
	450	+	15 finance charge based on the aggregate principal resulting from the
	451	+	16 consolidation at a rate not in excess of that permitted by the provisions
	452	+	17 on loan finance charge for consumer loans (IC 24-4.5-3-201) or the
	453	+	18 provisions on loan finance charge for supervised loans (IC
	454	+	19 24-4.5-3-508), (section 508 of this chapter, for supervised loans
	455	+	20 made before July 1, 2022, or section 508.1 of this chapter, for
	456	+	21 supervised loans made after June 30, 2022), whichever is
	457	+	22 appropriate.
	458	+	23 (2) The parties may agree to consolidate the unpaid balance of a
	459	+	24 consumer loan with the unpaid balance of a consumer credit sale. The
	460	+	25 parties may agree to refinance the previous unpaid balance pursuant to
	461	+	26 the provisions on refinancing sales (IC 24-4.5-2-205) or the provisions
	462	+	27 on refinancing loans (IC 24-4.5-3-205), whichever is appropriate, and
	463	+	28 to consolidate the amount financed resulting from the refinancing or
	464	+	29 the principal resulting from the refinancing by adding it to the amount
	465	+	30 financed or principal with respect to the subsequent sale or loan. The
	466	+	31 aggregate amount resulting from the consolidation shall be deemed
	467	+	32 principal, and the creditor may contract for and receive a loan finance
	468	+	33 charge based on the principal at a rate not in excess of that permitted
	469	+	34 by the provisions on loan finance charge for consumer loans (IC
	470	+	35 24-4.5-3-201) or the provisions on loan finance charge for supervised
	471	+	36 loans (IC 24-4.5-3-508), (section 508 of this chapter, for supervised
	472	+	37 loans made before July 1, 2022, or section 508.1 of this chapter, for
	473	+	38 supervised loans made after June 30, 2022), whichever is
	474	+	39 appropriate.
	475	+	40 SECTION 6. IC 24-4.5-3-208 IS AMENDED TO READ AS
	476	+	41 FOLLOWS [EFFECTIVE JULY 1, 2022]: Sec. 208. Advances to
	477	+	42 Perform Covenants of Debtor. — (1) This section does not apply to
	478	+	2022 IN 352—LS 6946/DI 101 11
	479	+	1 a supervised loan made after June 30, 2022, under section 508.1 of
	480	+	2 this chapter. If the agreement with respect to a consumer loan,
	481	+	3 refinancing, or consolidation contains covenants by the debtor to
	482	+	4 perform certain duties pertaining to insuring or preserving collateral
	483	+	5 and if the lender pursuant to the agreement pays for performance of the
	484	+	6 duties on behalf of the debtor, the lender may add the amounts paid to
	485	+	7 the debt. Within a reasonable time after advancing any sums, he the
	486	+	8 lender shall state to the debtor in writing the amount of the sums
	487	+	9 advanced, any charges with respect to this amount, and any revised
	488	+	10 payment schedule and, if the duties of the debtor performed by the
	489	+	11 lender pertain to insurance, a brief description of the insurance paid for
	490	+	12 by the lender including the type and amount of coverages. No further
	491	+	13 information need be given.
	492	+	14 (2) A loan finance charge may be made for sums advanced pursuant
	493	+	15 to subsection (1) at a rate not exceeding the rate stated to the debtor
	494	+	16 pursuant to the provisions on disclosure (Part 3) with respect to the
	495	+	17 loan, refinancing, or consolidation, except that with respect to a
	496	+	18 revolving loan account the amount of the advance may be added to the
	497	+	19 unpaid balance of the debt and the lender may make a loan finance
	498	+	20 charge not exceeding that permitted by the provisions on loan finance
	499	+	21 charge for consumer loans (24-4.5-3-201) (section 201 of this
	500	+	22 chapter) or for supervised loans (24-4.5-3-508), (section 508 of this
	501	+	23 chapter), whichever is appropriate.
	502	+	24 SECTION 7. IC 24-4.5-3-501, AS AMENDED BY P.L.91-2013,
	503	+	25 SECTION 3, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
	504	+	26 JULY 1, 2022]: Sec. 501. Definitions:
	505	+	27 (1) "Supervised loan" means a consumer loan:
	506	+	28 (a) in which the rate of the loan finance charge exceeds
	507	+	29 twenty-five percent (25%) per year as determined according to the
	508	+	30 provisions on loan finance charge for consumer loans in section
	509	+	31 201 of this chapter, in the case of a loan entered into before
	510	+	32 July 1, 2022; or
	511	+	33 (b) that is made in accordance with section 508.1 of this
	512	+	34 chapter, in the case of a loan entered into after June 30, 2022.
	513	+	35 (2) "Supervised lender" means a person authorized to make or take
	514	+	36 assignments of supervised loans.
	515	+	37 SECTION 8. IC 24-4.5-3-508, AS AMENDED BY P.L.85-2020,
	516	+	38 SECTION 16, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
	517	+	39 JULY 1, 2022]: Sec. 508. Loan Finance Charge for Supervised Loans
	518	+	40 ) (1) This section applies only to a supervised loan entered into
	519	+	41 before July 1, 2022. With respect to a supervised loan, including a
	520	+	42 loan pursuant to a revolving loan account, a supervised lender may
	521	+	2022 IN 352—LS 6946/DI 101 12
	522	+	1 contract for and receive a loan finance charge not exceeding that
	523	+	2 permitted by this section.
	524	+	3 (2) The loan finance charge, calculated according to the actuarial
	525	+	4 method, may not exceed the equivalent of the greater of:
	526	+	5 (a) the total of:
	527	+	6 (i) thirty-six percent (36%) per year on that part of the unpaid
	528	+	7 balances of the principal (as defined in section 107(3) of this
	529	+	8 chapter) which is two thousand dollars ($2,000) or less;
	530	+	9 (ii) twenty-one percent (21%) per year on that part of the
	531	+	10 unpaid balances of the principal (as defined in section 107(3)
	532	+	11 of this chapter) which is more than two thousand dollars
	533	+	12 ($2,000) but does not exceed four thousand dollars ($4,000);
	534	+	13 and
	535	+	14 (iii) fifteen percent (15%) per year on that part of the unpaid
	536	+	15 balances of the principal (as defined in section 107(3) of this
	537	+	16 chapter) which is more than four thousand dollars ($4,000); or
	538	+	17 (b) twenty-five percent (25%) per year on the unpaid balances of
	539	+	18 the principal (as defined in section 107(3) of this chapter).
	540	+	19 (3) In the case of a loan agreement entered into before July 1, 2020,
	541	+	20 this section does not limit or restrict the manner of contracting for the
	542	+	21 loan finance charge, whether by way of add-on, discount, or otherwise,
	543	+	22 so long as the rate of the loan finance charge does not exceed that
	544	+	23 permitted by this section. If the loan is precomputed:
	545	+	24 (a) the loan finance charge may be calculated on the assumption
	546	+	25 that all scheduled payments will be made when due; and
	547	+	26 (b) the effect of prepayment is governed by the provisions on
	548	+	27 rebate upon prepayment in section 210 of this chapter.
	549	+	28 After June 30, 2020, and before July 1, 2022, a loan agreement may
	550	+	29 not be entered into for a precomputed supervised loan.
	551	+	30 (4) The term of a loan for the purposes of this section commences
	552	+	31 on the date the loan is made. Differences in the lengths of months are
	553	+	32 disregarded, and a day may be counted as one-thirtieth (1/30) of a
	554	+	33 month. Subject to classifications and differentiations the lender may
	555	+	34 reasonably establish, a part of a month in excess of fifteen (15) days
	556	+	35 may be treated as a full month if periods of fifteen (15) days or less are
	557	+	36 disregarded and that procedure is not consistently used to obtain a
	558	+	37 greater yield than would otherwise be permitted.
	559	+	38 (5) Subject to classifications and differentiations the lender may
	560	+	39 reasonably establish, the lender may make the same loan finance
	561	+	40 charge on all principal amounts within a specified range. A loan
	562	+	41 finance charge does not violate subsection (2) if:
	563	+	42 (a) when applied to the median amount within each range, it does
	564	+	2022 IN 352—LS 6946/DI 101 13
	565	+	1 not exceed the maximum permitted in subsection (2); and
	566	+	2 (b) when applied to the lowest amount within each range, it does
	567	+	3 not produce a rate of loan finance charge exceeding the rate
	568	+	4 calculated according to subdivision (a) by more than eight percent
	569	+	5 (8%) of the rate calculated according to subdivision (a).
	570	+	6 (6) The amounts of two thousand dollars ($2,000) and four thousand
	571	+	7 dollars ($4,000) in subsection (2) and thirty dollars ($30) in subsection
	572	+	8 (7) are subject to change pursuant to the provisions on adjustment of
	573	+	9 dollar amounts (IC 24-4.5-1-106). However, notwithstanding
	574	+	10 IC 24-4.5-1-106(1), for the adjustment of the amount of thirty dollars
	575	+	11 ($30), the Reference Base Index to be used is the Index for October
	576	+	12 1992. Notwithstanding IC 24-4.5-1-106(1), for the adjustment of the
	577	+	13 amounts of two thousand dollars ($2,000) and four thousand dollars
	578	+	14 ($4,000), the Reference Base Index to be used is the Index for October
	579	+	15 2012.
	580	+	16 (7) With respect to a supervised loan not made pursuant to a
	581	+	17 revolving loan account, the lender may contract for and receive a
	582	+	18 minimum loan finance charge of not more than thirty dollars ($30). The
	583	+	19 minimum loan finance charge allowed under this subsection may be
	584	+	20 imposed only if the lender does not assess a nonrefundable prepaid
	585	+	21 finance charge under subsection (8) and:
	586	+	22 (a) the debtor prepays in full a consumer loan, refinancing, or
	587	+	23 consolidation, regardless of whether the loan, refinancing, or
	588	+	24 consolidation is precomputed;
	589	+	25 (b) the loan, refinancing, or consolidation prepaid by the debtor
	590	+	26 is subject to a loan finance charge that:
	591	+	27 (i) is contracted for by the parties; and
	592	+	28 (ii) does not exceed the rate prescribed in subsection (2); and
	593	+	29 (c) the loan finance charge earned at the time of prepayment is
	594	+	30 less than the minimum loan finance charge contracted for under
	595	+	31 this subsection.
	596	+	32 (8) Except as provided in subsections (7) and (10)(c), in addition to
	597	+	33 the loan finance charge provided for in this section and to any other
	598	+	34 charges and fees permitted by this chapter, the lender may contract for
	599	+	35 and receive a nonrefundable prepaid finance charge of not more than
	600	+	36 fifty dollars ($50) if the loan agreement is entered into before July 1,
	601	+	37 2020, and, if the loan agreement is entered into after June 30, 2020, not
	602	+	38 more than the following:
	603	+	39 (a) Seventy-five dollars ($75), in the case of a loan agreement for
	604	+	40 a principal amount which is two thousand dollars ($2,000) or less.
	605	+	41 (b) One hundred fifty dollars ($150) in the case of a loan
	606	+	42 agreement for a principal amount which is more than two
	607	+	2022 IN 352—LS 6946/DI 101 14
	608	+	1 thousand dollars ($2,000) but does not exceed four thousand
	609	+	2 dollars ($4,000).
	610	+	3 (c) Two hundred dollars ($200) in the case of a loan agreement
	611	+	4 for a principal amount which is more than four thousand dollars
	612	+	5 ($4,000).
	613	+	6 The amounts in this subsection are not subject to change under
	614	+	7 IC 24-4.5-1-106.
	615	+	8 (9) The nonrefundable prepaid finance charge provided for in
	616	+	9 subsection (8) is not subject to refund or rebate. However, for any
	617	+	10 supervised loan entered into after June 30, 2020, any amount charged
	618	+	11 by the lender, other than by a lender that is a depository institution (as
	619	+	12 defined in IC 24-4.5-1-301.5(12)), under subsection (8) that exceeds
	620	+	13 the applicable amount permitted by subsection (8) constitutes a
	621	+	14 violation of this article under IC 24-4.5-6-107.5(l) and is subject to
	622	+	15 refund. Any amount charged by a depository institution (as defined in
	623	+	16 IC 24-4.5-1-301.5(12)) under subsection (8) that exceeds the applicable
	624	+	17 amount set forth in subsection (8) is subject to refund.
	625	+	18 (10) Notwithstanding subsections (8) and (9), in the case of a
	626	+	19 supervised loan that is not secured by an interest in land, if a lender
	627	+	20 retains any part of a nonrefundable prepaid finance charge charged on
	628	+	21 a loan that is paid in full by a new loan from the same lender, the
	629	+	22 following apply:
	630	+	23 (a) If the loan is paid in full by the new loan within three (3)
	631	+	24 months after the date of the prior loan, the lender may not charge
	632	+	25 a nonrefundable prepaid finance charge on the new loan, or, in the
	633	+	26 case of a revolving loan, on the increased credit line.
	634	+	27 (b) The lender may not assess more than two (2) nonrefundable
	635	+	28 prepaid finance charges in any twelve (12) month period.
	636	+	29 (c) Subject to subdivisions (a) and (b), if a supervised loan that is
	637	+	30 entered into by a lender and a debtor before July 1, 2020, is paid
	638	+	31 in full by a new loan from the same lender after June 30, 2020, the
	639	+	32 lender may contract for and receive a nonrefundable prepaid
	640	+	33 finance charge in the amount set forth in subsection (8) for loan
	641	+	34 agreements entered into after June 30, 2020.
	642	+	35 (11) In the case of a supervised loan that is secured by an interest in
	643	+	36 land, this section does not prohibit a lender from contracting for and
	644	+	37 receiving a fee for preparing deeds, mortgages, reconveyances, and
	645	+	38 similar documents under section 202(1)(d)(ii) of this chapter, in
	646	+	39 addition to the nonrefundable prepaid finance charge provided for in
	647	+	40 subsection (8).
	648	+	41 SECTION 9. IC 24-4.5-3-508.1 IS ADDED TO THE INDIANA
	649	+	42 CODE AS A NEW SECTION TO READ AS FOLLOWS
	650	+	2022 IN 352—LS 6946/DI 101 15
	651	+	1 [EFFECTIVE JULY 1, 2022]: Sec. 508.1. (1) This section applies to
	652	+	2 a supervised loan entered into after June 30, 2022.
	653	+	3 (2) Subject to subsections (4) and (5), with respect to a
	654	+	4 supervised loan, other than a loan pursuant to a revolving loan
	655	+	5 account, a supervised lender may contract for and receive the
	656	+	6 following if the supervised loan meets all requirements set forth in
	657	+	7 this section:
	658	+	8 (a) A loan finance charge, calculated according to the
	659	+	9 actuarial method, not exceeding thirty-six percent (36%) per
	660	+	10 year on the unpaid balances of the principal (as defined in
	661	+	11 section 107(3) of this chapter). The loan finance charge does
	662	+	12 not include the fees and charges set forth in subdivisions (b)
	663	+	13 through (e).
	664	+	14 (b) A monthly maintenance fee that does not exceed thirteen
	665	+	15 percent (13%) of the principal amount originally contracted
	666	+	16 for, as long as the fee is not added to the unpaid balances of
	667	+	17 the principal (as defined in section 107(3) of this chapter) that
	668	+	18 are subject to the loan finance charge under subdivision (a).
	669	+	19 (c) Delinquency charges permitted under section 203.5 of this
	670	+	20 chapter.
	671	+	21 (d) Charges permitted under section 202(1)(f) of this chapter
	672	+	22 for returned payments of dishonored checks, electronic funds
	673	+	23 transfers, negotiable orders of withdrawal, or share drafts
	674	+	24 issued by the borrower.
	675	+	25 (e) If the principal amount originally contracted for is at least
	676	+	26 four hundred dollars ($400), an underwriting fee not to exceed
	677	+	27 fifty dollars ($50).
	678	+	28 No other charges are permitted in connection with a supervised
	679	+	29 loan, including any charges for cashing the loan proceeds if the
	680	+	30 proceeds are given in check form.
	681	+	31 (3) The principal amount of a supervised loan may not exceed
	682	+	32 two thousand five hundred dollars ($2,500). The amount of two
	683	+	33 thousand five hundred dollars ($2,500) in this subdivision is subject
	684	+	34 to change under IC 24-4.5-1-106.
	685	+	35 (4) Notwithstanding any other law, a lender may not contract
	686	+	36 for, charge, collect, or receive in connection with a supervised loan
	687	+	37 made under this section a total amount of fees and charges over the
	688	+	38 life of the loan, as disclosed in accordance with subsection 9(a), that
	689	+	39 exceeds:
	690	+	40 (a) seventy-five percent (75%) of the principal amount
	691	+	41 originally contracted for, if the principal amount originally
	692	+	42 contracted for is one thousand five hundred dollars ($1,500)
	693	+	2022 IN 352—LS 6946/DI 101 16
	694	+	1 or less; or
	695	+	2 (b) one hundred percent (100%) of the principal amount
	696	+	3 originally contracted for, if the principal amount originally
	697	+	4 contracted for is greater than one thousand five hundred
	698	+	5 dollars ($1,500).
	699	+	6 All fees and charges imposed in connection with the loan must be
	700	+	7 included in the calculation of the total amount of fees and charges
	701	+	8 under this subsection, except for delinquency charges described in
	702	+	9 subsection (2)(c) and charges for returned payments described in
	703	+	10 subsection (2)(d).
	704	+	11 (5) A supervised loan made under this section must be an
	705	+	12 interest bearing loan payable in substantially equal installments
	706	+	13 consisting of:
	707	+	14 (a) principal;
	708	+	15 (b) the loan finance charge permitted under subsection (2)(a);
	709	+	16 and
	710	+	17 (c) other permitted fees and charges under subsection (2);
	711	+	18 combined.
	712	+	19 (6) A supervised loan may not be made for a term of:
	713	+	20 (a) less than three (3) calendar months; or
	714	+	21 (b) more than twenty-four (24) calendar months.
	715	+	22 (7) Before making a supervised loan under this section, the
	716	+	23 lender shall make a reasonable attempt to verify the borrower's:
	717	+	24 (a) gross monthly income, exclusive of any income other than
	718	+	25 gross pay received; or
	719	+	26 (b) monthly funds actually received, net of taxes and other
	720	+	27 deductions;
	721	+	28 including, at a minimum, obtaining from the borrower at least one
	722	+	29 (1) recent pay stub or other written evidence of the borrower's
	723	+	30 gross monthly income or net monthly funds received (as described
	724	+	31 in subsections (a) and (b), respectively), such as a bank statement.
	725	+	32 For purposes of this subsection, verification of a borrower's gross
	726	+	33 monthly income or net monthly funds received must include the
	727	+	34 lender's receipt of at least one (1) document that, when presented
	728	+	35 to the lender, is dated not earlier than ninety (90) days before the
	729	+	36 borrower's initiation of the loan transaction and not later than the
	730	+	37 time the loan is made.
	731	+	38 (8) A supervised lender may not have more than one (1)
	732	+	39 supervised loan made under this section outstanding to the same
	733	+	40 borrower at any time. A supervised lender shall maintain a record
	734	+	41 of loan transactions for each borrower with whom the supervised
	735	+	42 lender has entered into a supervised loan transaction. A record
	736	+	2022 IN 352—LS 6946/DI 101 17
	737	+	1 required by this subsection must include at least the following
	738	+	2 information:
	739	+	3 (a) The name, address, and telephone number of the
	740	+	4 borrower.
	741	+	5 (b) The date each payment is made under the loan and the due
	742	+	6 date of the payment.
	743	+	7 (9) A supervised loan made under this section must be entered
	744	+	8 into under a written contract that sets forth the terms and
	745	+	9 conditions of the loan. The lender shall provide a copy of the loan
	746	+	10 contract to the borrower upon consummation of the loan
	747	+	11 transaction. The loan contract must disclose in a clear and concise
	748	+	12 manner the following:
	749	+	13 (a) The total amount of fees and charges the borrower will be
	750	+	14 required to pay under the loan contract.
	751	+	15 (b) The total amount of each payment, the due date for each
	752	+	16 payment, and the total number of payments the borrower will
	753	+	17 be required to make under the loan contract.
	754	+	18 (c) The annual percentage rate, inclusive of monthly fees.
	755	+	19 (d) The following notices in at least 10 point bold face type:
	756	+	20 (i) "NOTICE TO THE BORROWER: This is a supervised
	757	+	21 loan made under IC 24-4.5-3-508.1, which allows lenders
	758	+	22 to charge higher than average rates if they follow certain
	759	+	23 consumer protection rules. INDIANA LAW PROHIBITS
	760	+	24 THIS LENDER AND ITS AFFILIATES FROM HAVING
	761	+	25 MORE THAN ONE SUCH LOAN OUTSTANDING TO
	762	+	26 YOU AT ANY TIME. A LENDER MAY NOT DIVIDE
	763	+	27 THE AMOUNT YOU BORROW INTO MULTIPLE
	764	+	28 LOANS.".
	765	+	29 (ii) "You have the right to rescind this loan by returning
	766	+	30 the principal amount originally contracted for to the
	767	+	31 lender not later than 5:00 p.m. on the second business day
	768	+	32 immediately following the day on which you enter into this
	769	+	33 contract.".
	770	+	34 (iii) "Electronic payment of amounts due under this
	771	+	35 contract is optional. You have the right to revoke or
	772	+	36 remove your authorization for electronic payment at any
	773	+	37 time.".
	774	+	38 Before consummation of the loan transaction, the lender must
	775	+	39 obtain the borrower's signature or initials next to each notice
	776	+	40 required under this subdivision.
	777	+	41 (10) When a borrower enters into a supervised loan under this
	778	+	42 section, the lender shall provide the borrower with a pamphlet
	779	+	2022 IN 352—LS 6946/DI 101 18
	780	+	1 approved by the department that describes:
	781	+	2 (a) the availability of debt management and credit counseling
	782	+	3 services;
	783	+	4 (b) the borrower's rights and responsibilities in the
	784	+	5 transaction; and
	785	+	6 (c) the availability of the 211 telephone dialing code for access
	786	+	7 to human services information and referrals, including
	787	+	8 information on and referrals to governmental or nonprofit
	788	+	9 organizations that assist persons in paying for housing costs,
	789	+	10 utility bills, and food.
	790	+	11 (11) A borrower may rescind, without penalty, a supervised loan
	791	+	12 transaction made under this section by:
	792	+	13 (a) notifying the lender, in the manner prescribed by the
	793	+	14 lender under the loan contract, that the borrower wants to
	794	+	15 rescind the loan transaction; and
	795	+	16 (b) returning to the lender the cash amount of the principal
	796	+	17 originally contracted for;
	797	+	18 not later than 5:00 p.m. on the second business day immediately
	798	+	19 following the day on which the loan transaction is entered into.
	799	+	20 Upon receipt of the borrower's notice and the cash amount of the
	800	+	21 principal under this subsection, the lender shall return to the
	801	+	22 borrower any fees and charges collected by the lender in
	802	+	23 connection with the loan.
	803	+	24 (12) A supervised lender shall not fail or refuse to accept cash
	804	+	25 or other good funds from the borrower, or from a third party on
	805	+	26 behalf of the borrower, for full or partial repayment of a
	806	+	27 supervised loan under this section. For purposes of this subsection,
	807	+	28 "good funds" includes:
	808	+	29 (a) a certified check;
	809	+	30 (b) a cashier's check;
	810	+	31 (c) a bank check; or
	811	+	32 (d) any other negotiable instrument;
	812	+	33 with respect to which payment cannot be stopped by the paying
	813	+	34 party.
	814	+	35 (13) The proceeds of a supervised loan made under this section
	815	+	36 may not be applied to any other loan made to the same borrower
	816	+	37 by the lender or by an affiliate of the lender. However, a lender or
	817	+	38 an affiliate of the lender may refinance a supervised loan made to
	818	+	39 a borrower under this section if the refinanced loan is also a
	819	+	40 supervised loan made under this section.
	820	+	41 (14) With respect to a supervised loan transaction in which cash
	821	+	42 is advanced to the borrower in exchange for a personal check of
	822	+	2022 IN 352—LS 6946/DI 101 19
	823	+	1 the borrower, the lender may not accept a check dated earlier than
	824	+	2 the date of the first required loan payment as set forth in the loan
	825	+	3 contract. Upon receipt of the check from the borrower, the lender
	826	+	4 shall immediately stamp the back of the check with an
	827	+	5 endorsement that states the following:
	828	+	6 "Negotiated as part of a loan made under IC 24-4.5-3-508.1.
	829	+	7 Holder takes this check subject to the claims and defenses of
	830	+	8 the maker.".
	831	+	9 A supervised loan described in this subsection is not considered a
	832	+	10 small loan subject to IC 24-4.5-7 if the supervised loan otherwise
	833	+	11 complies with this section.
	834	+	12 (15) A person shall not commit or cause to be committed any of
	835	+	13 the following acts or practices in connection with a supervised loan
	836	+	14 under this section:
	837	+	15 (a) Using any device or agreement that would have the effect
	838	+	16 of charging or collecting more fees, charges, or interest than
	839	+	17 allowed by this section, including:
	840	+	18 (i) entering into a different type of transaction with the
	841	+	19 borrower;
	842	+	20 (ii) entering into a sales/leaseback or rebate arrangement;
	843	+	21 (iii) making catalog sales; or
	844	+	22 (iv) entering into any other transaction with the borrower
	845	+	23 or with any other person if the transaction is designed to
	846	+	24 evade the applicability of this section.
	847	+	25 (b) Including any of the following provisions in the loan
	848	+	26 contract or in any loan document:
	849	+	27 (i) A hold harmless clause.
	850	+	28 (ii) A confession of judgment clause.
	851	+	29 (iii) A provision in which the borrower agrees not to assert
	852	+	30 a claim or defense arising out of the loan contract.
	853	+	31 (iv) A provision by which a person acting on behalf of the
	854	+	32 lender is treated as an agent of the borrower in connection
	855	+	33 with the supervised loan.
	856	+	34 (c) Accepting real or personal property, or any interest in
	857	+	35 property, in connection with the loan other than a check, as
	858	+	36 described in subsection (14).
	859	+	37 (d) Drafting funds electronically from a borrower's account
	860	+	38 without the borrower's express written authorization.
	861	+	39 (e) Failing to stop attempts to draft funds electronically from
	862	+	40 a borrower's account upon request from the borrower or the
	863	+	41 borrower's agent.
	864	+	42 (f) Attempting to draft funds electronically from a borrower's
	865	+	2022 IN 352—LS 6946/DI 101 20
	866	+	1 account after four (4) consecutive attempts have failed, unless
	867	+	2 the lender obtains new written authorization from the
	868	+	3 borrower to transfer or withdraw funds electronically from
	869	+	4 the borrower's account.
	870	+	5 This subsection does not prohibit the conversion of a negotiable
	871	+	6 instrument into an electronic form for processing through the
	872	+	7 automated clearing house system.
	873	+	8 (16) In applying the provisions of this article on
	874	+	9 unconscionability (IC 24-4.5-5-108 and IC 24-4.5-6-111) to a
	875	+	10 supervised loan transaction made under this section, consideration
	876	+	11 shall be given, among other factors, to the following:
	877	+	12 (a) The ability of the borrower to repay the supervised loan
	878	+	13 within the terms of the loan made under this section.
	879	+	14 (b) Whether the borrower's original request as to the amount
	880	+	15 and terms of the loan were within the limitations set forth in
	881	+	16 this section.
	882	+	17 (17) Any person that is not exempt from licensure under section
	883	+	18 502 of this chapter and that:
	884	+	19 (a) facilitates;
	885	+	20 (b) enables; or
	886	+	21 (c) acts as a conduit or agent for;
	887	+	22 a third party that enters into a consumer loan that is subject to
	888	+	23 both the loan finance charge described in subsection (2)(a) and the
	889	+	24 monthly maintenance fee described in subsection (2)(b) is required
	890	+	25 to obtain a license under section 502 of this chapter, regardless of
	891	+	26 whether the third party is exempt from licensure under section 502
	892	+	27 of this chapter.
	893	+	28 (18) Regardless of whether a person is exempt under federal or
	894	+	29 state law from:
	895	+	30 (a) the finance charge limitation set forth in subsection (2)(a);
337	896		31 or
338		-	32 (ii) the transaction was precomputed in the case of a
339		-	33 transaction and was entered into before July 1, 2020, the
340		-	34 amount which the debtor would have been required to pay
341		-	35 upon prepayment pursuant to the provisions on rebate upon
342		-	36 prepayment (IC 24-4.5-3-210) (section 210 of this chapter)
343		-	37 on the date of refinancing.
344		-	38 (b) Appropriate additional charges (IC 24-4.5-3-202), payment of
345		-	39 which is deferred.
346		-	40 SECTION 4. IC 24-4.5-3-206, AS AMENDED BY P.L.85-2020,
347		-	41 SECTION 13, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
348		-	42 JULY 1, 2022]: Sec. 206. Loan Finance Charge on Consolidation —
349		-	SB 352—LS 6946/DI 101 8
350		-	1 (1) If a debtor owes an unpaid balance to a lender with respect to a
351		-	2 consumer loan, refinancing, or consolidation, and becomes obligated
352		-	3 on another consumer loan, refinancing, or consolidation with the same
353		-	4 lender, the parties may agree to a consolidation resulting in a single
354		-	5 schedule of payments. If the previous consumer loan, refinancing, or
355		-	6 consolidation was not precomputed, the parties may agree to add the
356		-	7 unpaid amount of principal and accrued charges on the date of
357		-	8 consolidation to the principal with respect to the subsequent loan. If the
358		-	9 previous consumer loan, refinancing, or consolidation was
359		-	10 precomputed in the case of a transaction and was entered into before
360		-	11 July 1, 2020, or if the previous transaction was made under section
361		-	12 508.1 of this chapter after June 30, 2022, the parties may agree to
362		-	13 refinance the unpaid balance pursuant to the provisions on refinancing
363		-	14 (IC 24-4.5-3-205) and to consolidate the principal resulting from the
364		-	15 refinancing by adding it to the principal with respect to the subsequent
365		-	16 loan. In either case the lender may contract for and receive a loan
366		-	17 finance charge based on the aggregate principal resulting from the
367		-	18 consolidation at a rate not in excess of that permitted by the provisions
368		-	19 on loan finance charge for consumer loans (IC 24-4.5-3-201) or the
369		-	20 provisions on loan finance charge for supervised loans
370		-	21 (IC 24-4.5-3-508), (section 508 of this chapter, for supervised loans
371		-	22 made before July 1, 2022, or section 508.1 of this chapter, for
372		-	23 supervised loans made after June 30, 2022), whichever is
373		-	24 appropriate.
374		-	25 (2) The parties may agree to consolidate the unpaid balance of a
375		-	26 consumer loan with the unpaid balance of a consumer credit sale. The
376		-	27 parties may agree to refinance the previous unpaid balance pursuant to
377		-	28 the provisions on refinancing sales (IC 24-4.5-2-205) or the provisions
378		-	29 on refinancing loans (IC 24-4.5-3-205), whichever is appropriate, and
379		-	30 to consolidate the amount financed resulting from the refinancing or
380		-	31 the principal resulting from the refinancing by adding it to the amount
381		-	32 financed or principal with respect to the subsequent sale or loan. The
382		-	33 aggregate amount resulting from the consolidation shall be deemed
383		-	34 principal, and the creditor may contract for and receive a loan finance
384		-	35 charge based on the principal at a rate not in excess of that permitted
385		-	36 by the provisions on loan finance charge for consumer loans
386		-	37 (IC 24-4.5-3-201) or the provisions on loan finance charge for
387		-	38 supervised loans (IC 24-4.5-3-508), (section 508 of this chapter, for
388		-	39 supervised loans made before July 1, 2022, or section 508.1 of this
389		-	40 chapter, for supervised loans made after June 30, 2022), whichever
390		-	41 is appropriate.
391		-	42 SECTION 5. IC 24-4.5-3-208 IS AMENDED TO READ AS
392		-	SB 352—LS 6946/DI 101 9
393		-	1 FOLLOWS [EFFECTIVE JULY 1, 2022]: Sec. 208. Advances to
394		-	2 Perform Covenants of Debtor. — (1) This section does not apply to
395		-	3 a supervised loan made after June 30, 2022, under section 508.1 of
396		-	4 this chapter. If the agreement with respect to a consumer loan,
397		-	5 refinancing, or consolidation contains covenants by the debtor to
398		-	6 perform certain duties pertaining to insuring or preserving collateral
399		-	7 and if the lender pursuant to the agreement pays for performance of the
400		-	8 duties on behalf of the debtor, the lender may add the amounts paid to
401		-	9 the debt. Within a reasonable time after advancing any sums, he the
402		-	10 lender shall state to the debtor in writing the amount of the sums
403		-	11 advanced, any charges with respect to this amount, and any revised
404		-	12 payment schedule and, if the duties of the debtor performed by the
405		-	13 lender pertain to insurance, a brief description of the insurance paid for
406		-	14 by the lender including the type and amount of coverages. No further
407		-	15 information need be given.
408		-	16 (2) A loan finance charge may be made for sums advanced pursuant
409		-	17 to subsection (1) at a rate not exceeding the rate stated to the debtor
410		-	18 pursuant to the provisions on disclosure (Part 3) with respect to the
411		-	19 loan, refinancing, or consolidation, except that with respect to a
412		-	20 revolving loan account the amount of the advance may be added to the
413		-	21 unpaid balance of the debt and the lender may make a loan finance
414		-	22 charge not exceeding that permitted by the provisions on loan finance
415		-	23 charge for consumer loans (24-4.5-3-201) (section 201 of this
416		-	24 chapter) or for supervised loans (24-4.5-3-508), (section 508 of this
417		-	25 chapter), whichever is appropriate.
418		-	26 SECTION 6. IC 24-4.5-3-501, AS AMENDED BY P.L.91-2013,
419		-	27 SECTION 3, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
420		-	28 JULY 1, 2022]: Sec. 501. Definitions:
421		-	29 (1) "Supervised loan" means a consumer loan:
422		-	30 (a) in which the rate of the loan finance charge exceeds
423		-	31 twenty-five percent (25%) per year as determined according to the
424		-	32 provisions on loan finance charge for consumer loans in section
425		-	33 201 of this chapter, in the case of a loan entered into before
426		-	34 July 1, 2022; or
427		-	35 (b) that is made in accordance with section 508.1 of this
428		-	36 chapter, in the case of a loan entered into after June 30, 2022.
429		-	37 (2) "Supervised lender" means a person authorized to make or take
430		-	38 assignments of supervised loans.
431		-	39 SECTION 7. IC 24-4.5-3-508, AS AMENDED BY P.L.85-2020,
432		-	40 SECTION 16, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
433		-	41 JULY 1, 2022]: Sec. 508. Loan Finance Charge for Supervised Loans
434		-	42 ) (1) This section applies only to a supervised loan entered into
435		-	SB 352—LS 6946/DI 101 10
436		-	1 before July 1, 2022. With respect to a supervised loan, including a
437		-	2 loan pursuant to a revolving loan account, a supervised lender may
438		-	3 contract for and receive a loan finance charge not exceeding that
439		-	4 permitted by this section.
440		-	5 (2) The loan finance charge, calculated according to the actuarial
441		-	6 method, may not exceed the equivalent of the greater of:
442		-	7 (a) the total of:
443		-	8 (i) thirty-six percent (36%) per year on that part of the unpaid
444		-	9 balances of the principal (as defined in section 107(3) of this
445		-	10 chapter) which is two thousand dollars ($2,000) or less;
446		-	11 (ii) twenty-one percent (21%) per year on that part of the
447		-	12 unpaid balances of the principal (as defined in section 107(3)
448		-	13 of this chapter) which is more than two thousand dollars
449		-	14 ($2,000) but does not exceed four thousand dollars ($4,000);
450		-	15 and
451		-	16 (iii) fifteen percent (15%) per year on that part of the unpaid
452		-	17 balances of the principal (as defined in section 107(3) of this
453		-	18 chapter) which is more than four thousand dollars ($4,000); or
454		-	19 (b) twenty-five percent (25%) per year on the unpaid balances of
455		-	20 the principal (as defined in section 107(3) of this chapter).
456		-	21 (3) In the case of a loan agreement entered into before July 1, 2020,
457		-	22 this section does not limit or restrict the manner of contracting for the
458		-	23 loan finance charge, whether by way of add-on, discount, or otherwise,
459		-	24 so long as the rate of the loan finance charge does not exceed that
460		-	25 permitted by this section. If the loan is precomputed:
461		-	26 (a) the loan finance charge may be calculated on the assumption
462		-	27 that all scheduled payments will be made when due; and
463		-	28 (b) the effect of prepayment is governed by the provisions on
464		-	29 rebate upon prepayment in section 210 of this chapter.
465		-	30 After June 30, 2020, and before July 1, 2022, a loan agreement may
466		-	31 not be entered into for a precomputed supervised loan.
467		-	32 (4) The term of a loan for the purposes of this section commences
468		-	33 on the date the loan is made. Differences in the lengths of months are
469		-	34 disregarded, and a day may be counted as one-thirtieth (1/30) of a
470		-	35 month. Subject to classifications and differentiations the lender may
471		-	36 reasonably establish, a part of a month in excess of fifteen (15) days
472		-	37 may be treated as a full month if periods of fifteen (15) days or less are
473		-	38 disregarded and that procedure is not consistently used to obtain a
474		-	39 greater yield than would otherwise be permitted.
475		-	40 (5) Subject to classifications and differentiations the lender may
476		-	41 reasonably establish, the lender may make the same loan finance
477		-	42 charge on all principal amounts within a specified range. A loan
478		-	SB 352—LS 6946/DI 101 11
479		-	1 finance charge does not violate subsection (2) if:
480		-	2 (a) when applied to the median amount within each range, it does
481		-	3 not exceed the maximum permitted in subsection (2); and
482		-	4 (b) when applied to the lowest amount within each range, it does
483		-	5 not produce a rate of loan finance charge exceeding the rate
484		-	6 calculated according to subdivision (a) by more than eight percent
485		-	7 (8%) of the rate calculated according to subdivision (a).
486		-	8 (6) The amounts of two thousand dollars ($2,000) and four thousand
487		-	9 dollars ($4,000) in subsection (2) and thirty dollars ($30) in subsection
488		-	10 (7) are subject to change pursuant to the provisions on adjustment of
489		-	11 dollar amounts (IC 24-4.5-1-106). However, notwithstanding
490		-	12 IC 24-4.5-1-106(1), for the adjustment of the amount of thirty dollars
491		-	13 ($30), the Reference Base Index to be used is the Index for October
492		-	14 1992. Notwithstanding IC 24-4.5-1-106(1), for the adjustment of the
493		-	15 amounts of two thousand dollars ($2,000) and four thousand dollars
494		-	16 ($4,000), the Reference Base Index to be used is the Index for October
495		-	17 2012.
496		-	18 (7) With respect to a supervised loan not made pursuant to a
497		-	19 revolving loan account, the lender may contract for and receive a
498		-	20 minimum loan finance charge of not more than thirty dollars ($30). The
499		-	21 minimum loan finance charge allowed under this subsection may be
500		-	22 imposed only if the lender does not assess a nonrefundable prepaid
501		-	23 finance charge under subsection (8) and:
502		-	24 (a) the debtor prepays in full a consumer loan, refinancing, or
503		-	25 consolidation, regardless of whether the loan, refinancing, or
504		-	26 consolidation is precomputed;
505		-	27 (b) the loan, refinancing, or consolidation prepaid by the debtor
506		-	28 is subject to a loan finance charge that:
507		-	29 (i) is contracted for by the parties; and
508		-	30 (ii) does not exceed the rate prescribed in subsection (2); and
509		-	31 (c) the loan finance charge earned at the time of prepayment is
510		-	32 less than the minimum loan finance charge contracted for under
511		-	33 this subsection.
512		-	34 (8) Except as provided in subsections (7) and (10)(c), in addition to
513		-	35 the loan finance charge provided for in this section and to any other
514		-	36 charges and fees permitted by this chapter, the lender may contract for
515		-	37 and receive a nonrefundable prepaid finance charge of not more than
516		-	38 fifty dollars ($50) if the loan agreement is entered into before July 1,
517		-	39 2020, and, if the loan agreement is entered into after June 30, 2020, not
518		-	40 more than the following:
519		-	41 (a) Seventy-five dollars ($75), in the case of a loan agreement for
520		-	42 a principal amount which is two thousand dollars ($2,000) or less.
521		-	SB 352—LS 6946/DI 101 12
522		-	1 (b) One hundred fifty dollars ($150) in the case of a loan
523		-	2 agreement for a principal amount which is more than two
524		-	3 thousand dollars ($2,000) but does not exceed four thousand
525		-	4 dollars ($4,000).
526		-	5 (c) Two hundred dollars ($200) in the case of a loan agreement
527		-	6 for a principal amount which is more than four thousand dollars
528		-	7 ($4,000).
529		-	8 The amounts in this subsection are not subject to change under
530		-	9 IC 24-4.5-1-106.
531		-	10 (9) The nonrefundable prepaid finance charge provided for in
532		-	11 subsection (8) is not subject to refund or rebate. However, for any
533		-	12 supervised loan entered into after June 30, 2020, any amount charged
534		-	13 by the lender, other than by a lender that is a depository institution (as
535		-	14 defined in IC 24-4.5-1-301.5(12)), under subsection (8) that exceeds
536		-	15 the applicable amount permitted by subsection (8) constitutes a
537		-	16 violation of this article under IC 24-4.5-6-107.5(l) and is subject to
538		-	17 refund. Any amount charged by a depository institution (as defined in
539		-	18 IC 24-4.5-1-301.5(12)) under subsection (8) that exceeds the applicable
540		-	19 amount set forth in subsection (8) is subject to refund.
541		-	20 (10) Notwithstanding subsections (8) and (9), in the case of a
542		-	21 supervised loan that is not secured by an interest in land, if a lender
543		-	22 retains any part of a nonrefundable prepaid finance charge charged on
544		-	23 a loan that is paid in full by a new loan from the same lender, the
545		-	24 following apply:
546		-	25 (a) If the loan is paid in full by the new loan within three (3)
547		-	26 months after the date of the prior loan, the lender may not charge
548		-	27 a nonrefundable prepaid finance charge on the new loan, or, in the
549		-	28 case of a revolving loan, on the increased credit line.
550		-	29 (b) The lender may not assess more than two (2) nonrefundable
551		-	30 prepaid finance charges in any twelve (12) month period.
552		-	31 (c) Subject to subdivisions (a) and (b), if a supervised loan that is
553		-	32 entered into by a lender and a debtor before July 1, 2020, is paid
554		-	33 in full by a new loan from the same lender after June 30, 2020, the
555		-	34 lender may contract for and receive a nonrefundable prepaid
556		-	35 finance charge in the amount set forth in subsection (8) for loan
557		-	36 agreements entered into after June 30, 2020.
558		-	37 (11) In the case of a supervised loan that is secured by an interest in
559		-	38 land, this section does not prohibit a lender from contracting for and
560		-	39 receiving a fee for preparing deeds, mortgages, reconveyances, and
561		-	40 similar documents under section 202(1)(d)(ii) of this chapter, in
562		-	41 addition to the nonrefundable prepaid finance charge provided for in
563		-	42 subsection (8).
564		-	SB 352—LS 6946/DI 101 13
565		-	1 SECTION 8. IC 24-4.5-3-508.1 IS ADDED TO THE INDIANA
566		-	2 CODE AS A NEW SECTION TO READ AS FOLLOWS
567		-	3 [EFFECTIVE JULY 1, 2022]: Sec. 508.1. (1) This section applies to
568		-	4 a supervised loan entered into after June 30, 2022.
569		-	5 (2) Subject to subsections (5) and (6), with respect to a
570		-	6 supervised loan, other than a loan pursuant to a revolving loan
571		-	7 account, a supervised lender may contract for and receive the
572		-	8 following if the supervised loan meets all requirements set forth in
573		-	9 this section:
574		-	10 (a) A loan finance charge, calculated according to the
575		-	11 actuarial method, not exceeding thirty-six percent (36%) per
576		-	12 year on the unpaid balances of the principal (as defined in
577		-	13 section 107(3) of this chapter). The loan finance charge does
578		-	14 not include the fees and charges set forth in subdivisions (b)
579		-	15 through (e).
580		-	16 (b) A monthly maintenance fee that does not exceed thirteen
581		-	17 percent (13%) of the principal amount originally contracted
582		-	18 for, as long as the fee is not added to the unpaid balances of
583		-	19 the principal (as defined in section 107(3) of this chapter) that
584		-	20 are subject to the loan finance charge under subdivision (a).
585		-	21 (c) Delinquency charges permitted under section 203.5 of this
586		-	22 chapter.
587		-	23 (d) Charges permitted under section 202(1)(f) of this chapter
588		-	24 for returned payments of dishonored checks, electronic funds
589		-	25 transfers, negotiable orders of withdrawal, or share drafts
590		-	26 issued by the borrower.
591		-	27 (e) If the principal amount originally contracted for is at least
592		-	28 four hundred dollars ($400), an underwriting fee not to exceed
593		-	29 fifty dollars ($50).
594		-	30 No other charges are permitted in connection with a supervised
595		-	31 loan, including any charges for cashing the loan proceeds if the
596		-	32 proceeds are given in check form.
597		-	33 (3) A supervised loan made in compliance with this section is
598		-	34 exempt from IC 35-45-7.
599		-	35 (4) The principal amount of a supervised loan may not exceed
600		-	36 two thousand five hundred dollars ($2,500). The amount of two
601		-	37 thousand five hundred dollars ($2,500) in this subdivision is subject
602		-	38 to change under IC 24-4.5-1-106.
603		-	39 (5) Notwithstanding any other law, a lender may not contract
604		-	40 for, charge, collect, or receive in connection with a supervised loan
605		-	41 made under this section a total amount of fees and charges over the
606		-	42 life of the loan, as disclosed in accordance with subsection 10(a),
607		-	SB 352—LS 6946/DI 101 14
608		-	1 that exceeds:
609		-	2 (a) seventy-five percent (75%) of the principal amount
610		-	3 originally contracted for, if the principal amount originally
611		-	4 contracted for is one thousand five hundred dollars ($1,500)
612		-	5 or less; or
613		-	6 (b) one hundred percent (100%) of the principal amount
614		-	7 originally contracted for, if the principal amount originally
615		-	8 contracted for is greater than one thousand five hundred
616		-	9 dollars ($1,500).
617		-	10 All fees and charges imposed in connection with the loan must be
618		-	11 included in the calculation of the total amount of fees and charges
619		-	12 under this subsection, except for delinquency charges described in
620		-	13 subsection (2)(c) and charges for returned payments described in
621		-	14 subsection (2)(d).
622		-	15 (6) A supervised loan made under this section must be an
623		-	16 interest bearing loan payable in substantially equal installments
624		-	17 consisting of:
625		-	18 (a) principal;
626		-	19 (b) the loan finance charge permitted under subsection (2)(a);
627		-	20 and
628		-	21 (c) other permitted fees and charges under subsection (2);
629		-	22 combined.
630		-	23 (7) A supervised loan may not be made for a term of:
631		-	24 (a) less than three (3) calendar months; or
632		-	25 (b) more than twenty-four (24) calendar months.
633		-	26 (8) Before making a supervised loan under this section, the
634		-	27 lender shall make a reasonable attempt to verify the borrower's:
635		-	28 (a) gross monthly income, exclusive of any income other than
636		-	29 gross pay received; or
637		-	30 (b) monthly funds actually received, net of taxes and other
638		-	31 deductions;
639		-	32 including, at a minimum, obtaining from the borrower at least one
640		-	33 (1) recent pay stub or other written evidence of the borrower's
641		-	34 gross monthly income or net monthly funds received (as described
642		-	35 in subdivisions (a) and (b), respectively), such as a bank statement.
643		-	36 For purposes of this subsection, verification of a borrower's gross
644		-	37 monthly income or net monthly funds received must include the
645		-	38 lender's receipt of at least one (1) document that, when presented
646		-	39 to the lender, is dated not earlier than ninety (90) days before the
647		-	40 borrower's initiation of the loan transaction and not later than the
648		-	41 time the loan is made.
649		-	42 (9) A supervised lender may not have more than one (1)
650		-	SB 352—LS 6946/DI 101 15
651		-	1 supervised loan made under this section outstanding to the same
652		-	2 borrower at any time. A supervised lender shall maintain a record
653		-	3 of loan transactions for each borrower with whom the supervised
654		-	4 lender has entered into a supervised loan transaction. A record
655		-	5 required by this subsection must include at least the following
656		-	6 information:
657		-	7 (a) The name, address, and telephone number of the
658		-	8 borrower.
659		-	9 (b) The date each payment is made under the loan and the due
660		-	10 date of the payment.
661		-	11 (10) A supervised loan made under this section must be entered
662		-	12 into under a written contract that sets forth the terms and
663		-	13 conditions of the loan. The lender shall provide a copy of the loan
664		-	14 contract to the borrower upon consummation of the loan
665		-	15 transaction. The loan contract must disclose in a clear and concise
666		-	16 manner the following:
667		-	17 (a) The total amount of fees and charges the borrower will be
668		-	18 required to pay under the loan contract.
669		-	19 (b) The total amount of each payment, the due date for each
670		-	20 payment, and the total number of payments the borrower will
671		-	21 be required to make under the loan contract.
672		-	22 (c) The annual percentage rate, inclusive of monthly fees.
673		-	23 (d) The following notices in at least 10 point bold face type:
674		-	24 (i) "NOTICE TO THE BORROWER: This is a supervised
675		-	25 loan made under IC 24-4.5-3-508.1, which allows lenders
676		-	26 to charge higher than average rates if they follow certain
677		-	27 consumer protection rules. INDIANA LAW PROHIBITS
678		-	28 THIS LENDER AND ITS AFFILIATES FROM HAVING
679		-	29 MORE THAN ONE SUCH LOAN OUTSTANDING TO
680		-	30 YOU AT ANY TIME. A LENDER MAY NOT DIVIDE
681		-	31 THE AMOUNT YOU BORROW INTO MULTIPLE
682		-	32 LOANS.".
683		-	33 (ii) "You have the right to rescind this loan by returning
684		-	34 the principal amount originally contracted for to the
685		-	35 lender not later than the end of the business day
686		-	36 immediately following the day on which the borrower
687		-	37 receives the proceeds.".
688		-	38 (iii) "Electronic payment of amounts due under this
689		-	39 contract is optional. You have the right to revoke or
690		-	40 remove your authorization for electronic payment at any
691		-	41 time.".
692		-	42 Before consummation of the loan transaction, the lender must
693		-	SB 352—LS 6946/DI 101 16
694		-	1 obtain the borrower's signature or initials next to each notice
695		-	2 required under this subdivision.
696		-	3 (11) When a borrower enters into a supervised loan under this
697		-	4 section, the lender shall provide the borrower with a pamphlet
698		-	5 approved by the department that describes:
699		-	6 (a) the availability of debt management and credit counseling
700		-	7 services;
701		-	8 (b) the borrower's rights and responsibilities in the
702		-	9 transaction; and
703		-	10 (c) the availability of the 211 telephone dialing code for access
704		-	11 to human services information and referrals, including
705		-	12 information on and referrals to governmental or nonprofit
706		-	13 organizations that assist persons in paying for housing costs,
707		-	14 utility bills, and food.
708		-	15 (12) A borrower may rescind, without penalty, a supervised loan
709		-	16 transaction made under this section by returning to the lender the
710		-	17 cash amount of the principal originally contracted for not later
711		-	18 than the end of the business day immediately following the day on
712		-	19 which the borrower receives the proceeds. Upon receipt of the
713		-	20 borrower's notice and the cash amount of the principal under this
714		-	21 subsection, the lender shall return to the borrower any fees and
715		-	22 charges collected by the lender in connection with the loan.
716		-	23 (13) A supervised lender shall not fail or refuse to accept cash
717		-	24 or other good funds from the borrower, or from a third party on
718		-	25 behalf of the borrower, for full or partial repayment of a
719		-	26 supervised loan under this section. For purposes of this subsection,
720		-	27 "good funds" includes:
721		-	28 (a) a certified check;
722		-	29 (b) a cashier's check;
723		-	30 (c) a bank check; or
724		-	31 (d) any other negotiable instrument;
725		-	32 with respect to which payment cannot be stopped by the paying
726		-	33 party.
727		-	34 (14) The proceeds of a supervised loan made under this section
728		-	35 may not be applied to any other loan made to the same borrower
729		-	36 by the lender or by an affiliate of the lender. However, a lender or
730		-	37 an affiliate of the lender may refinance a supervised loan made to
731		-	38 a borrower under this section if the refinanced loan is also a
732		-	39 supervised loan made under this section.
733		-	40 (15) With respect to a supervised loan transaction in which cash
734		-	41 is advanced to the borrower in exchange for a personal check of
735		-	42 the borrower, the lender may not accept a check dated earlier than
736		-	SB 352—LS 6946/DI 101 17
737		-	1 the date of the first required loan payment as set forth in the loan
738		-	2 contract. Upon receipt of the check from the borrower, the lender
739		-	3 shall immediately stamp the back of the check with an
740		-	4 endorsement that states the following:
741		-	5 "Negotiated as part of a loan made under IC 24-4.5-3-508.1.
742		-	6 Holder takes this check subject to the claims and defenses of
743		-	7 the maker.".
744		-	8 A supervised loan described in this subsection is not considered a
745		-	9 small loan subject to IC 24-4.5-7 if the supervised loan otherwise
746		-	10 complies with this section.
747		-	11 (16) A person shall not commit or cause to be committed any of
748		-	12 the following acts or practices in connection with a supervised loan
749		-	13 under this section:
750		-	14 (a) Using any device or agreement that would have the effect
751		-	15 of charging or collecting more fees, charges, or interest than
752		-	16 allowed by this section, including:
753		-	17 (i) entering into a different type of transaction with the
754		-	18 borrower;
755		-	19 (ii) entering into a sales/leaseback or rebate arrangement;
756		-	20 (iii) making catalog sales; or
757		-	21 (iv) entering into any other transaction with the borrower
758		-	22 or with any other person if the transaction is designed to
759		-	23 evade the applicability of this section.
760		-	24 (b) Including any of the following provisions in the loan
761		-	25 contract or in any loan document:
762		-	26 (i) A hold harmless clause.
763		-	27 (ii) A confession of judgment clause.
764		-	28 (iii) A provision in which the borrower agrees not to assert
765		-	29 a claim or defense arising out of the loan contract.
766		-	30 (iv) A provision by which a person acting on behalf of the
767		-	31 lender is treated as an agent of the borrower in connection
768		-	32 with the supervised loan.
769		-	33 (c) Accepting real or personal property, or any interest in
770		-	34 property, in connection with the loan other than a check, as
771		-	35 described in subsection (15).
772		-	36 (d) Drafting funds electronically from a borrower's account
773		-	37 without the borrower's express written authorization.
774		-	38 (e) Failing to stop attempts to draft funds electronically from
775		-	39 a borrower's account upon request from the borrower or the
776		-	40 borrower's agent.
777		-	41 (f) Attempting to draft funds electronically from a borrower's
778		-	42 account after three (3) consecutive attempts have failed,
779		-	SB 352—LS 6946/DI 101 18
780		-	1 unless the lender obtains new written authorization from the
781		-	2 borrower to transfer or withdraw funds electronically from
782		-	3 the borrower's account.
783		-	4 This subsection does not prohibit the conversion of a negotiable
784		-	5 instrument into an electronic form for processing through the
785		-	6 automated clearing house system.
786		-	7 (17) In applying the provisions of this article on
787		-	8 unconscionability (IC 24-4.5-5-108 and IC 24-4.5-6-111) to a
788		-	9 supervised loan transaction made under this section, consideration
789		-	10 shall be given, among other factors, to the following:
790		-	11 (a) The ability of the borrower to repay the supervised loan
791		-	12 within the terms of the loan made under this section.
792		-	13 (b) Whether the borrower's original request as to the amount
793		-	14 and terms of the loan were within the limitations set forth in
794		-	15 this section.
795		-	16 (18) A lender that makes at least one (1) supervised loan under
796		-	17 this chapter in Indiana during a calendar year shall remit the
797		-	18 following to the department at the time of license renewal under
798		-	19 section 503.6 of this chapter, if the lender is required to be licensed
799		-	20 under section 502 of this chapter:
800		-	21 (a) An annual fee, paid separately from the required renewal
801		-	22 fee (if applicable), in the amount of two hundred fifty dollars
802		-	23 ($250).
803		-	24 (b) An additional two hundred fifty dollars ($250) per branch
804		-	25 location in Indiana from which the lender makes supervised
805		-	26 loans under this section, after the lender's first Indiana
806		-	27 location from which the lender makes supervised loans under
807		-	28 this chapter.
808		-	29 All amounts collected by the department under this subsection
809		-	30 shall be held in the consumer financial education fund established
810		-	31 by subsection (19) and shall be used exclusively, in the
811		-	32 department's discretion, for providing or supporting financial
812		-	33 education programs for the benefit of Indiana consumers. A lender
813		-	34 may not pass any part of the amounts required by this subsection
814		-	35 onto borrowers by imposing an additional charge in connection
815		-	36 with any supervised loan, or through any charge or fee authorized
816		-	37 under subsection (2).
817		-	38 (19) The consumer financial education fund is established for
818		-	39 the purpose of paying expenses incurred by the department in
819		-	40 administering subsection (18), and for paying all expenses incurred
820		-	41 and all compensation paid by the department relating to consumer
821		-	42 financial education. The following apply with respect to the fund:
822		-	SB 352—LS 6946/DI 101 19
823		-	1 (a) The department shall administer the fund.
824		-	2 (b) The fund consists of:
825		-	3 (i) money deposited in the fund under subsection (18); and
826		-	4 (ii) donations, gifts, and money received from any other
827		-	5 source.
828		-	6 (c) The expenses of administering the fund shall be paid from
829		-	7 money in the fund.
830		-	8 (d) The treasurer of state shall invest the money in the fund
831		-	9 not currently needed to meet the obligations of the fund in the
832		-	10 same manner as other public money may be invested. Interest
833		-	11 that accrues from these investments shall be deposited in the
834		-	12 fund.
835		-	13 (e) Money in the fund at the end of a state fiscal year does not
836		-	14 revert to the state general fund.
837		-	15 (f) Money in the fund is appropriated for the purpose set forth
838		-	16 in this subsection.
839		-	17 (20) Except for a person described in section 502(1) of this
840		-	18 chapter, a person that enters into at least one (1) supervised loan
841		-	19 transaction under this section in Indiana in any calendar year,
842		-	20 shall file with the department, at such time and in such manner as
843		-	21 the director may prescribe, a report concerning the person's
844		-	22 business and operations with respect to that calendar year. The
845		-	23 director shall prescribe the information to be included in the
846		-	24 report so as to enable the director to produce the analysis required
847		-	25 by subsection (21). The department may adopt rules under
848		-	26 IC 4-22-2 to implement this subsection, including emergency rules
849		-	27 in the manner provided under IC 4-22-2-37.1. Notwithstanding
850		-	28 IC 4-22-2-37.1(g), an emergency rule adopted by the department
851		-	29 under this subsection and in the manner provided under
852		-	30 IC 4-22-2-37.1 expires on the date on which a rule that supersedes
853		-	31 the emergency rule is adopted by the department under
854		-	32 IC 4-22-2-24 through IC 4-22-2-36.
855		-	33 (21) The director shall publish and make available to the public,
856		-	34 at least annually, an analysis of the information provided to the
857		-	35 department under subsection (20). The analysis must include the
858		-	36 following information with respect to the most recent calendar
859		-	37 year:
860		-	38 (a) The total number of supervised loan transactions entered
861		-	39 into.
862		-	40 (b) The total number of borrowers obligated under the loans
863		-	41 reported under subdivision (a).
864		-	42 (c) The average principal amount of the loans.
865		-	SB 352—LS 6946/DI 101 20
866		-	1 (d) The average contracted annual percentage rate of the
867		-	2 loans.
868		-	3 (e) The total amount of contracted finance charges under the
869		-	4 loans.
870		-	5 (f) The total amount of maintenance fees collected on the
871		-	6 loans.
872		-	7 (g) The total amount of contractual underwriting fees on the
873		-	8 loans.
874		-	9 (h) The number of loans on which borrowers defaulted.
875		-	10 (i) The total number and total dollar value of charged off
876		-	11 loans. For purposes of this subdivision, "charged off loan"
877		-	12 means a loan with respect to which the lender has stopped
878		-	13 pursuing first party collection efforts.
879		-	14 (j) The total number and total dollar value of delinquency
880		-	15 charges (as authorized by subsection (2)(c)) incurred by
881		-	16 borrowers.
882		-	17 SECTION 9. IC 24-4.5-3-509 IS AMENDED TO READ AS
883		-	18 FOLLOWS [EFFECTIVE JULY 1, 2022]: Sec. 509. Use of Multiple
884		-	19 Agreements. — With respect to a consumer loan, no lender may permit
885		-	20 any person, or husband and wife, to become obligated in any way under
886		-	21 more than one loan agreement with the lender or with a person related
887		-	22 to the lender, with intent to obtain a higher rate of loan finance charge
888		-	23 than would otherwise be permitted by the provisions on loan finance
889		-	24 charge for supervised loans (IC 24-4.5-3-508) (section 508 of this
890		-	25 chapter, for supervised loans made before July 1, 2022, or section
891		-	26 508.1 of this chapter, for supervised loans made after June 30,
892		-	27 2022), or to avoid disclosure of an annual percentage rate pursuant to
893		-	28 the provisions on disclosure (Part 3). The excess amount of loan
894		-	29 finance charge provided for in agreements in violation of this section
895		-	30 is an excess charge for the purposes of the provisions on effect of
896		-	31 violations on rights of parties (IC 24-4.5-5-202) and the provisions on
897		-	32 civil actions by the department (IC 24-4.5-6-113).
898		-	33 SECTION 10. IC 24-4.5-3-510, AS AMENDED BY P.L.186-2015,
899		-	34 SECTION 19, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
900		-	35 JULY 1, 2022]: Sec. 510. Restrictions on Interest in Land as Security
901		-	36 — (1) With respect to a supervised loan in that is made before July
902		-	37 1, 2022, and with respect to which the principal is four thousand
903		-	38 dollars ($4,000) or less, a lender may not contract for an interest in land
904		-	39 as security. With respect to a supervised loan that is made under
905		-	40 section 508.1 of this chapter after June 30, 2022, a lender may not
906		-	41 contract for an interest of land as security, as set forth in section
907		-	42 508.1(15)(c). A security interest taken in violation of this section is
908		-	SB 352—LS 6946/DI 101 21
909		-	1 void.
910		-	2 (2) The amount of four thousand dollars ($4,000) in subsection (1)
911		-	3 is subject to change pursuant to the provisions on adjustment of dollar
912		-	4 amounts (IC 24-4.5-1-106). However, notwithstanding
913		-	5 IC 24-4.5-1-106(1), the Reference Base Index to be used under this
914		-	6 subsection is the Index for October 2012.
915		-	7 SECTION 11. IC 24-4.5-3-511, AS AMENDED BY P.L.10-2019,
916		-	8 SECTION 107, IS AMENDED TO READ AS FOLLOWS
917		-	9 [EFFECTIVE JULY 1, 2022]: Sec. 511. Regular Schedule of
918		-	10 Payments; Maximum Loan Term — (1) This section applies only to
919		-	11 a supervised loan that is made before July 1, 2022. Supervised loans
920		-	12 not made pursuant to a revolving loan account and in which the
921		-	13 principal is four thousand dollars ($4,000) or less are payable in a
922		-	14 single instalment or shall be scheduled to be payable in substantially
923		-	15 equal instalments that are payable at equal periodic intervals, except to
924		-	16 the extent that the schedule of payments is adjusted to the seasonal or
925		-	17 irregular income of the debtor, and:
926		-	18 (a) over a period of not more than thirty-seven (37) months if the
927		-	19 principal is more than three hundred dollars ($300); or
928		-	20 (b) over a period of not more than twenty-five (25) months if the
929		-	21 principal is three hundred dollars ($300) or less.
930		-	22 (2) The amounts of three hundred dollars ($300) and four thousand
931		-	23 dollars ($4,000) in subsection (1) are subject to change pursuant to the
932		-	24 provisions on adjustment of dollar amounts (IC 24-4.5-1-106).
933		-	25 However, notwithstanding IC 24-4.5-1-106(1), the Reference Base
934		-	26 Index to be used with respect to the amount of:
935		-	27 (a) three hundred dollars ($300) is the Index for October 1992;
936		-	28 and
937		-	29 (b) four thousand dollars ($4,000) is the Index for October 2012.
938		-	30 SECTION 12. IC 24-4.5-4-107, AS AMENDED BY P.L.85-2020,
939		-	31 SECTION 17, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
940		-	32 JULY 1, 2022]: Sec. 107. Maximum Charge by Creditor for Insurance
941		-	33 - (1) This section does not apply to a supervised loan that is made
942		-	34 under IC 24-4.5-3-508.1 after June 30, 2022. Except as provided in
943		-	35 subsection (2), if a creditor contracts for or receives a separate charge
944		-	36 for insurance, the amount charged to the debtor for the insurance may
945		-	37 not exceed the premium to be charged by the insurer, as computed at
946		-	38 the time the charge to the debtor is determined, conforming to any rate
947		-	39 filings required by law and made by the insurer with the insurance
948		-	40 commissioner.
949		-	41 (2) A creditor who provides consumer credit insurance in relation
950		-	42 to a revolving charge account (as defined in IC 24-4.5-2-108) or
951		-	SB 352—LS 6946/DI 101 22
952		-	1 revolving loan account (as defined in IC 24-4.5-3-108) may calculate
953		-	2 the charge to the debtor in each billing cycle by applying the current
954		-	3 premium rate to one (1) of the following:
955		-	4 (a) The average daily unpaid balance of the debt in the cycle.
956		-	5 (b) The unpaid balance of the debt or a median amount within a
957		-	6 specified range of unpaid balances of debt on approximately the
958		-	7 same day of the cycle. The day of the cycle need not be the day
959		-	8 used in calculating the credit service charge (IC 24-4.5-2-201(6))
960		-	9 or loan finance charge (IC 24-4.5-3-201 and IC 24-4.5-3-508), but
961		-	10 the specified range shall be the range used for that purpose.
962		-	11 (c) The unpaid balances of principal calculated according to the
963		-	12 actuarial method.
964		-	13 (d) The amount of the insurance benefit for the cycle.
965		-	14 SECTION 13. IC 24-4.5-7-102, AS AMENDED BY P.L.69-2018,
966		-	15 SECTION 25, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
967		-	16 JULY 1, 2022]: Sec. 102. (1) Except as otherwise provided, all
968		-	17 provisions of this article applying to consumer loans, including
969		-	18 IC 24-4.5-3-502.2, apply to small loans, as defined in this chapter.
970		-	19 (2) Subject to subsection (7), a person may not regularly engage in
971		-	20 Indiana in any of the following actions unless the department first
972		-	21 issues to the person a license under this chapter:
973		-	22 (a) The making of small loans.
974		-	23 (b) Taking assignments of small loans.
975		-	24 (c) Undertaking the direct collection of payments from or the
976		-	25 enforcement of rights against debtors arising from small loans.
977		-	26 (3) Subject to subsection (4), a person that seeks licensure under
978		-	27 this chapter:
979		-	28 (a) shall apply to the department for a license in the form and
980		-	29 manner prescribed by the department; and
981		-	30 (b) is subject to the same licensure requirements and procedures
982		-	31 as an applicant for a license to make consumer loans (other than
983		-	32 mortgage transactions) under IC 24-4.5-3-502.
984		-	33 (4) A person that seeks to make, take assignments of, or undertake
985		-	34 the direct collection of payments from or the enforcement of rights
986		-	35 against debtors arising from both:
987		-	36 (a) small loans under this chapter; and
988		-	37 (b) consumer loans (other than mortgage transactions) that are not
989		-	38 small loans;
990		-	39 must obtain a separate license from the department for each type of
991		-	40 loan, as described in IC 24-4.5-3-502(5).
992		-	41 (5) This chapter applies to:
993		-	42 (a) a lender;
994		-	SB 352—LS 6946/DI 101 23
995		-	1 (b) a bank, savings association, credit union, or other state or
996		-	2 federally regulated financial institution except those that are
997		-	3 specifically exempt regarding limitations on interest rates and
998		-	4 fees; or
999		-	5 (c) a person, if the department determines that a transaction is:
1000		-	6 (i) in substance a disguised loan; or
1001		-	7 (ii) the application of subterfuge for the purpose of avoiding
	897	+	32 (b) licensure under section 502 of this chapter;
	898	+	33 if the person enters into a supervised loan transaction under this
	899	+	34 section, all other provisions of this section apply to both the person
	900	+	35 and the loan transaction.
	901	+	36 (19) A lender that makes at least one (1) supervised loan under
	902	+	37 this chapter in Indiana during a calendar year shall remit the
	903	+	38 following to the department at the time of license renewal under
	904	+	39 section 503.6 of this chapter, if the lender is required to be licensed
	905	+	40 under section 502 of this chapter, or at such other time as the
	906	+	41 department prescribes, if the lender is exempt from licensure
	907	+	42 under section 502 of this chapter:
	908	+	2022 IN 352—LS 6946/DI 101 21
	909	+	1 (a) An annual fee, paid separately from the required renewal
	910	+	2 fee (if applicable), in the amount of two hundred fifty dollars
	911	+	3 ($250).
	912	+	4 (b) An additional two hundred fifty dollars ($250) per branch
	913	+	5 location in Indiana from which the lender makes supervised
	914	+	6 loans under this section, after the lender's first Indiana
	915	+	7 location from which the lender makes supervised loans under
1002	916		8 this chapter.
1003		-	9 (6) A loan that:
1004		-	10 (a) does not qualify as a small loan under section 104 of this
1005		-	11 chapter;
1006		-	12 (b) is for a term shorter than that specified in section 401(1) of
1007		-	13 this chapter; or
1008		-	14 (c) is made in violation of section 201, 401, 402, 404, or 410 of
1009		-	15 this chapter;
1010		-	16 is subject to this article. The department may conform the loan finance
1011		-	17 charge for a loan described in this subsection to the limitations set forth
1012		-	18 in IC 24-4.5-3-508(2). IC 24-4.5-3-201(1)(b).
1013		-	19 (7) Notwithstanding IC 24-4.5-1-301.5, for purposes of subsection
1014		-	20 (2), a person "regularly engages" in any of the activities described in
1015		-	21 subsection (2) with respect to a small loan if the person:
1016		-	22 (a) performed any of the activities described in subsection (2)
1017		-	23 with respect to a small loan at least one (1) time in the preceding
1018		-	24 calendar year; or
1019		-	25 (b) performs or will perform any of the activities described in
1020		-	26 subsection (2) with respect to a small loan at least one (1) time in
1021		-	27 the current calendar year if the person did not perform any of the
1022		-	28 activities described in subsection (2) with respect to a small loan
1023		-	29 at least one (1) time in the preceding calendar year.
1024		-	30 SECTION 14. IC 24-4.5-7-104, AS AMENDED BY P.L.216-2013,
1025		-	31 SECTION 13, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
1026		-	32 JULY 1, 2022]: Sec. 104. (1) "Small loan" means a loan:
1027		-	33 (a) with a principal loan amount that is at least fifty dollars ($50)
1028		-	34 and not more than five hundred fifty dollars ($550); and
1029		-	35 (b) in which the lender holds the borrower's check for a specific
1030		-	36 period, or receives the borrower's written authorization to debit
1031		-	37 the borrower's account (other than as a result of default) under an
1032		-	38 agreement, either express or implied, for a specific period, before
1033		-	39 the lender:
1034		-	40 (i) offers the check for deposit or presentment; or
1035		-	41 (ii) exercises the authorization to debit the borrower's account.
1036		-	42 (2) The amount of five hundred fifty dollars ($550) in subsection
1037		-	SB 352—LS 6946/DI 101 24
1038		-	1 (1)(a) is subject to change under the provisions on adjustment of dollar
1039		-	2 amounts (IC 24-4.5-1-106). However, notwithstanding
1040		-	3 IC 24-4.5-1-106(1), the Reference Base Index to be used under this
1041		-	4 subsection is the Index for October 2006.
1042		-	5 (3) Notwithstanding:
1043		-	6 (a) IC 24-4.5-3-508.1(3); and
1044		-	7 (b) IC 24-4.5-3-508.1(14);
1045		-	8 a supervised loan made under IC 24-4.5-3-508.1 after June 30,
1046		-	9 2022, is not considered a small loan that is subject to this chapter
1047		-	10 if the supervised loan is made in compliance with IC 24-4.5-3-508.1.
1048		-	11 SECTION 15. IC 24-4.5-7-411 IS AMENDED TO READ AS
1049		-	12 FOLLOWS [EFFECTIVE JULY 1, 2022]: Sec. 411. Finance charges
1050		-	13 made in compliance with this chapter are exempt from:
1051		-	14 (a) IC 24-4.5-3-508, in the case of a small loan made before
1052		-	15 July 1, 2022;
1053		-	16 (b) IC 24-4.5-3-508.1, in the case of a small loan made after
1054		-	17 June 30, 2022; and
1055		-	18 (c) IC 35-45-7.
1056		-	19 SECTION 16. IC 28-7-5-28 IS AMENDED TO READ AS
1057		-	20 FOLLOWS [EFFECTIVE JULY 1, 2022]: Sec. 28. (a) The maximum
1058		-	21 rate of interest charged by pawnbrokers shall be the same as the
1059		-	22 maximum loan finance charge for supervised lenders under
1060		-	23 IC 24-4.5-3-508(2). consumer loans set forth in
1061		-	24 IC 24-4.5-3-201(1)(b). For purposes of this subsection:
1062		-	25 (1) the term of a loan commences on the date on which the loan
1063		-	26 is made;
1064		-	27 (2) differences in lengths of months are disregarded; and
1065		-	28 (3) each day is counted as one-thirtieth (1/30) of a month.
1066		-	29 The minimum term of a loan made by a pawnbroker is one (1) month.
1067		-	30 However, on loans paid in full within the first month, the pawnbroker
1068		-	31 may charge one (1) month's interest.
1069		-	32 (b) Interest shall not be deducted in advance, neither shall the
1070		-	33 pawnbroker induce or permit any borrower to split up or divide any
1071		-	34 loan or loans for the purpose of evading any provisions of this chapter.
1072		-	35 (c) If a pawnbroker charges or receives interest in excess of that
1073		-	36 provided in this section, or makes any charges not authorized by this
1074		-	37 chapter, the pawnbroker shall forfeit principal and interest and return
1075		-	38 the pledge upon demand of the pledger and surrender of the pawn
1076		-	39 ticket without the principal or interest. If such excessive or
1077		-	40 unauthorized charges have been paid by the pledger, the pledger may
1078		-	41 recover the same, including the principal if paid, in a civil action
1079		-	42 against the pawnbroker.
1080		-	SB 352—LS 6946/DI 101 25
1081		-	1 SECTION 17. IC 35-45-7-2, AS AMENDED BY P.L.158-2013,
1082		-	2 SECTION 536, IS AMENDED TO READ AS FOLLOWS
1083		-	3 [EFFECTIVE JULY 1, 2022]: Sec. 2. A person who, in exchange for
1084		-	4 the loan of any property, knowingly or intentionally receives or
1085		-	5 contracts to receive from another person any consideration, at a rate
1086		-	6 greater than two (2) times the rate specified in IC 24-4.5-3-508(2)(a)(i),
1087		-	7 IC 24-4.5-3-201(1)(b), commits loansharking, a Level 6 felony.
1088		-	8 However, loansharking is a Level 5 felony if force or the threat of force
1089		-	9 is used to collect or to attempt to collect any of the property loaned or
1090		-	10 any of the consideration for the loan.
1091		-	SB 352—LS 6946/DI 101 26
1092		-	COMMITTEE REPORT
1093		-	Madam President: The Senate Committee on Insurance and
1094		-	Financial Institutions, to which was referred Senate Bill No. 352, has
1095		-	had the same under consideration and begs leave to report the same
1096		-	back to the Senate with the recommendation that said bill be
1097		-	AMENDED as follows:
1098		-	Page 3, line 14, delete "prohibited, other than in the case of a
1099		-	supervised loan made" and insert "prohibited.".
1100		-	Page 3, delete line 15.
1101		-	Page 7, delete lines 13 through 42.
1102		-	Delete page 8.
1103		-	Page 9, delete lines 1 through 8.
1104		-	Page 9, line 29, delete "or if the".
1105		-	Page 9, delete line 30.
1106		-	Page 9, line 31, delete "508.1 of this chapter after June 30, 2022,".
1107		-	Page 15, line 3, delete "(4) and (5)," and insert "(5) and (6),".
1108		-	Page 15, between lines 30 and 31, begin a new paragraph and insert:
1109		-	"(3) A supervised loan made in compliance with this section is
1110		-	exempt from IC 35-45-7.".
1111		-	Page 15, line 31, delete "(3)" and insert "(4)".
1112		-	Page 15, line 35, delete "(4)" and insert "(5)".
1113		-	Page 15, line 38, delete "9(a)," and insert "10(a),".
1114		-	Page 16, line 11, delete "(5)" and insert "(6)".
1115		-	Page 16, line 19, delete "(6)" and insert "(7)".
1116		-	Page 16, line 22, delete "(7)" and insert "(8)".
1117		-	Page 16, line 31, delete "subsections" and insert "subdivisions".
1118		-	Page 16, line 38, delete "(8)" and insert "(9)".
1119		-	Page 17, line 7, delete "(9)" and insert "(10)".
1120		-	Page 17, line 31, delete "5:00 p.m. on the second business day" and
1121		-	insert "the end of the business day immediately following the day on
1122		-	which the borrower receives the proceeds.".".
1123		-	Page 17, delete lines 32 through 33.
1124		-	Page 17, line 41, delete "(10)" and insert "(11)".
1125		-	Page 18, line 11, delete "(11)" and insert "(12)".
1126		-	Page 18, line 12, delete "by:" and insert "by returning to the lender
1127		-	the cash amount of the principal originally contracted for not later
1128		-	than the end of the business day immediately following the day on
1129		-	which the borrower receives the proceeds.".
1130		-	Page 18, delete lines 13 through 19.
1131		-	Page 18, run in lines 12 through 20.
1132		-	Page 18, line 24, delete "(12)" and insert "(13)".
1133		-	SB 352—LS 6946/DI 101 27
1134		-	Page 18, line 35, delete "(13)" and insert "(14)".
1135		-	Page 18, line 41, delete "(14)" and insert "(15)".
1136		-	Page 19, line 12, delete "(15)" and insert "(16)".
1137		-	Page 19, line 36, delete "(14)." and insert "(15).".
1138		-	Page 20, line 1, delete "four (4)" and insert "three (3)".
1139		-	Page 20, line 8, delete "(16)" and insert "(17)".
1140		-	Page 20, delete lines 17 through 35.
1141		-	Page 20, line 36, delete "(19)" and insert "(18)".
1142		-	Page 20, line 40, delete "chapter, or at such other time as the" and
1143		-	insert "chapter:".
1144		-	Page 20, delete lines 41 through 42.
1145		-	Page 21, line 11, delete "(20)" and insert "(19)".
1146		-	Page 21, line 18, delete "(20)" and insert "(19)".
1147		-	Page 21, line 20, delete "(19)," and insert "(18),".
1148		-	Page 21, line 25, delete "(19);" and insert "(18);".
1149		-	Page 21, line 39, delete "(21)" and insert "(20)".
1150		-	Page 22, line 5, delete "(22)." and insert "(21).".
1151		-	Page 22, line 13, delete "(22)" and insert "(21)".
1152		-	Page 22, line 15, delete "(21)." and insert "(20).".
1153		-	Page 22, between lines 26 and 27, begin a new line block indented
1154		-	and insert:
1155		-	"(f) The total amount of maintenance fees collected on the
1156		-	loans.
1157		-	(g) The total amount of contractual underwriting fees on the
1158		-	loans.".
1159		-	Page 22, line 27, delete "(f)" and insert "(h)".
1160		-	Page 22, line 28, delete "(g)" and insert "(i)".
1161		-	Page 22, line 32, delete "(h)" and insert "(j)".
1162		-	Renumber all SECTIONS consecutively.
1163		-	and when so amended that said bill do pass.
1164		-	(Reference is to SB 352 as introduced.)
1165		-	ZAY, Chairperson
1166		-	Committee Vote: Yeas 7, Nays 2.
1167		-	SB 352—LS 6946/DI 101
	917	+	9 All amounts collected by the department under this subsection
	918	+	10 shall be held in the consumer financial education fund established
	919	+	11 by subsection (20) and shall be used exclusively, in the
	920	+	12 department's discretion, for providing or supporting financial
	921	+	13 education programs for the benefit of Indiana consumers. A lender
	922	+	14 may not pass any part of the amounts required by this subsection
	923	+	15 onto borrowers by imposing an additional charge in connection
	924	+	16 with any supervised loan, or through any charge or fee authorized
	925	+	17 under subsection (2).
	926	+	18 (20) The consumer financial education fund is established for
	927	+	19 the purpose of paying expenses incurred by the department in
	928	+	20 administering subsection (19), and for paying all expenses incurred
	929	+	21 and all compensation paid by the department relating to consumer
	930	+	22 financial education. The following apply with respect to the fund:
	931	+	23 (a) The department shall administer the fund.
	932	+	24 (b) The fund consists of:
	933	+	25 (i) money deposited in the fund under subsection (19); and
	934	+	26 (ii) donations, gifts, and money received from any other
	935	+	27 source.
	936	+	28 (c) The expenses of administering the fund shall be paid from
	937	+	29 money in the fund.
	938	+	30 (d) The treasurer of state shall invest the money in the fund
	939	+	31 not currently needed to meet the obligations of the fund in the
	940	+	32 same manner as other public money may be invested. Interest
	941	+	33 that accrues from these investments shall be deposited in the
	942	+	34 fund.
	943	+	35 (e) Money in the fund at the end of a state fiscal year does not
	944	+	36 revert to the state general fund.
	945	+	37 (f) Money in the fund is appropriated for the purpose set forth
	946	+	38 in this subsection.
	947	+	39 (21) Except for a person described in section 502(1) of this
	948	+	40 chapter, a person that enters into at least one (1) supervised loan
	949	+	41 transaction under this section in Indiana in any calendar year,
	950	+	42 shall file with the department, at such time and in such manner as
	951	+	2022 IN 352—LS 6946/DI 101 22
	952	+	1 the director may prescribe, a report concerning the person's
	953	+	2 business and operations with respect to that calendar year. The
	954	+	3 director shall prescribe the information to be included in the
	955	+	4 report so as to enable the director to produce the analysis required
	956	+	5 by subsection (22). The department may adopt rules under
	957	+	6 IC 4-22-2 to implement this subsection, including emergency rules
	958	+	7 in the manner provided under IC 4-22-2-37.1. Notwithstanding
	959	+	8 IC 4-22-2-37.1(g), an emergency rule adopted by the department
	960	+	9 under this subsection and in the manner provided under
	961	+	10 IC 4-22-2-37.1 expires on the date on which a rule that supersedes
	962	+	11 the emergency rule is adopted by the department under
	963	+	12 IC 4-22-2-24 through IC 4-22-2-36.
	964	+	13 (22) The director shall publish and make available to the public,
	965	+	14 at least annually, an analysis of the information provided to the
	966	+	15 department under subsection (21). The analysis must include the
	967	+	16 following information with respect to the most recent calendar
	968	+	17 year:
	969	+	18 (a) The total number of supervised loan transactions entered
	970	+	19 into.
	971	+	20 (b) The total number of borrowers obligated under the loans
	972	+	21 reported under subdivision (a).
	973	+	22 (c) The average principal amount of the loans.
	974	+	23 (d) The average contracted annual percentage rate of the
	975	+	24 loans.
	976	+	25 (e) The total amount of contracted finance charges under the
	977	+	26 loans.
	978	+	27 (f) The number of loans on which borrowers defaulted.
	979	+	28 (g) The total number and total dollar value of charged off
	980	+	29 loans. For purposes of this subdivision, "charged off loan"
	981	+	30 means a loan with respect to which the lender has stopped
	982	+	31 pursuing first party collection efforts.
	983	+	32 (h) The total number and total dollar value of delinquency
	984	+	33 charges (as authorized by subsection (2)(c)) incurred by
	985	+	34 borrowers.
	986	+	35 SECTION 10. IC 24-4.5-3-509 IS AMENDED TO READ AS
	987	+	36 FOLLOWS [EFFECTIVE JULY 1, 2022]: Sec. 509. Use of Multiple
	988	+	37 Agreements. — With respect to a consumer loan, no lender may permit
	989	+	38 any person, or husband and wife, to become obligated in any way under
	990	+	39 more than one loan agreement with the lender or with a person related
	991	+	40 to the lender, with intent to obtain a higher rate of loan finance charge
	992	+	41 than would otherwise be permitted by the provisions on loan finance
	993	+	42 charge for supervised loans (IC 24-4.5-3-508) (section 508 of this
	994	+	2022 IN 352—LS 6946/DI 101 23
	995	+	1 chapter, for supervised loans made before July 1, 2022, or section
	996	+	2 508.1 of this chapter, for supervised loans made after June 30,
	997	+	3 2022), or to avoid disclosure of an annual percentage rate pursuant to
	998	+	4 the provisions on disclosure (Part 3). The excess amount of loan
	999	+	5 finance charge provided for in agreements in violation of this section
	1000	+	6 is an excess charge for the purposes of the provisions on effect of
	1001	+	7 violations on rights of parties (IC 24-4.5-5-202) and the provisions on
	1002	+	8 civil actions by the department (IC 24-4.5-6-113).
	1003	+	9 SECTION 11. IC 24-4.5-3-510, AS AMENDED BY P.L.186-2015,
	1004	+	10 SECTION 19, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
	1005	+	11 JULY 1, 2022]: Sec. 510. Restrictions on Interest in Land as Security
	1006	+	12 — (1) With respect to a supervised loan in that is made before July
	1007	+	13 1, 2022, and with respect to which the principal is four thousand
	1008	+	14 dollars ($4,000) or less, a lender may not contract for an interest in land
	1009	+	15 as security. With respect to a supervised loan that is made under
	1010	+	16 section 508.1 of this chapter after June 30, 2022, a lender may not
	1011	+	17 contract for an interest of land as security, as set forth in section
	1012	+	18 508.1(15)(c). A security interest taken in violation of this section is
	1013	+	19 void.
	1014	+	20 (2) The amount of four thousand dollars ($4,000) in subsection (1)
	1015	+	21 is subject to change pursuant to the provisions on adjustment of dollar
	1016	+	22 amounts (IC 24-4.5-1-106). However, notwithstanding
	1017	+	23 IC 24-4.5-1-106(1), the Reference Base Index to be used under this
	1018	+	24 subsection is the Index for October 2012.
	1019	+	25 SECTION 12. IC 24-4.5-3-511, AS AMENDED BY P.L.10-2019,
	1020	+	26 SECTION 107, IS AMENDED TO READ AS FOLLOWS
	1021	+	27 [EFFECTIVE JULY 1, 2022]: Sec. 511. Regular Schedule of
	1022	+	28 Payments; Maximum Loan Term — (1) This section applies only to
	1023	+	29 a supervised loan that is made before July 1, 2022. Supervised loans
	1024	+	30 not made pursuant to a revolving loan account and in which the
	1025	+	31 principal is four thousand dollars ($4,000) or less are payable in a
	1026	+	32 single instalment or shall be scheduled to be payable in substantially
	1027	+	33 equal instalments that are payable at equal periodic intervals, except to
	1028	+	34 the extent that the schedule of payments is adjusted to the seasonal or
	1029	+	35 irregular income of the debtor, and:
	1030	+	36 (a) over a period of not more than thirty-seven (37) months if the
	1031	+	37 principal is more than three hundred dollars ($300); or
	1032	+	38 (b) over a period of not more than twenty-five (25) months if the
	1033	+	39 principal is three hundred dollars ($300) or less.
	1034	+	40 (2) The amounts of three hundred dollars ($300) and four thousand
	1035	+	41 dollars ($4,000) in subsection (1) are subject to change pursuant to the
	1036	+	42 provisions on adjustment of dollar amounts (IC 24-4.5-1-106).
	1037	+	2022 IN 352—LS 6946/DI 101 24
	1038	+	1 However, notwithstanding IC 24-4.5-1-106(1), the Reference Base
	1039	+	2 Index to be used with respect to the amount of:
	1040	+	3 (a) three hundred dollars ($300) is the Index for October 1992;
	1041	+	4 and
	1042	+	5 (b) four thousand dollars ($4,000) is the Index for October 2012.
	1043	+	6 SECTION 13. IC 24-4.5-4-107, AS AMENDED BY P.L.85-2020,
	1044	+	7 SECTION 17, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
	1045	+	8 JULY 1, 2022]: Sec. 107. Maximum Charge by Creditor for Insurance
	1046	+	9 - (1) This section does not apply to a supervised loan that is made
	1047	+	10 under IC 24-4.5-3-508.1 after June 30, 2022. Except as provided in
	1048	+	11 subsection (2), if a creditor contracts for or receives a separate charge
	1049	+	12 for insurance, the amount charged to the debtor for the insurance may
	1050	+	13 not exceed the premium to be charged by the insurer, as computed at
	1051	+	14 the time the charge to the debtor is determined, conforming to any rate
	1052	+	15 filings required by law and made by the insurer with the insurance
	1053	+	16 commissioner.
	1054	+	17 (2) A creditor who provides consumer credit insurance in relation
	1055	+	18 to a revolving charge account (as defined in IC 24-4.5-2-108) or
	1056	+	19 revolving loan account (as defined in IC 24-4.5-3-108) may calculate
	1057	+	20 the charge to the debtor in each billing cycle by applying the current
	1058	+	21 premium rate to one (1) of the following:
	1059	+	22 (a) The average daily unpaid balance of the debt in the cycle.
	1060	+	23 (b) The unpaid balance of the debt or a median amount within a
	1061	+	24 specified range of unpaid balances of debt on approximately the
	1062	+	25 same day of the cycle. The day of the cycle need not be the day
	1063	+	26 used in calculating the credit service charge (IC 24-4.5-2-201(6))
	1064	+	27 or loan finance charge (IC 24-4.5-3-201 and IC 24-4.5-3-508), but
	1065	+	28 the specified range shall be the range used for that purpose.
	1066	+	29 (c) The unpaid balances of principal calculated according to the
	1067	+	30 actuarial method.
	1068	+	31 (d) The amount of the insurance benefit for the cycle.
	1069	+	32 SECTION 14. IC 24-4.5-7-102, AS AMENDED BY P.L.69-2018,
	1070	+	33 SECTION 25, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
	1071	+	34 JULY 1, 2022]: Sec. 102. (1) Except as otherwise provided, all
	1072	+	35 provisions of this article applying to consumer loans, including
	1073	+	36 IC 24-4.5-3-502.2, apply to small loans, as defined in this chapter.
	1074	+	37 (2) Subject to subsection (7), a person may not regularly engage in
	1075	+	38 Indiana in any of the following actions unless the department first
	1076	+	39 issues to the person a license under this chapter:
	1077	+	40 (a) The making of small loans.
	1078	+	41 (b) Taking assignments of small loans.
	1079	+	42 (c) Undertaking the direct collection of payments from or the
	1080	+	2022 IN 352—LS 6946/DI 101 25
	1081	+	1 enforcement of rights against debtors arising from small loans.
	1082	+	2 (3) Subject to subsection (4), a person that seeks licensure under
	1083	+	3 this chapter:
	1084	+	4 (a) shall apply to the department for a license in the form and
	1085	+	5 manner prescribed by the department; and
	1086	+	6 (b) is subject to the same licensure requirements and procedures
	1087	+	7 as an applicant for a license to make consumer loans (other than
	1088	+	8 mortgage transactions) under IC 24-4.5-3-502.
	1089	+	9 (4) A person that seeks to make, take assignments of, or undertake
	1090	+	10 the direct collection of payments from or the enforcement of rights
	1091	+	11 against debtors arising from both:
	1092	+	12 (a) small loans under this chapter; and
	1093	+	13 (b) consumer loans (other than mortgage transactions) that are not
	1094	+	14 small loans;
	1095	+	15 must obtain a separate license from the department for each type of
	1096	+	16 loan, as described in IC 24-4.5-3-502(5).
	1097	+	17 (5) This chapter applies to:
	1098	+	18 (a) a lender;
	1099	+	19 (b) a bank, savings association, credit union, or other state or
	1100	+	20 federally regulated financial institution except those that are
	1101	+	21 specifically exempt regarding limitations on interest rates and
	1102	+	22 fees; or
	1103	+	23 (c) a person, if the department determines that a transaction is:
	1104	+	24 (i) in substance a disguised loan; or
	1105	+	25 (ii) the application of subterfuge for the purpose of avoiding
	1106	+	26 this chapter.
	1107	+	27 (6) A loan that:
	1108	+	28 (a) does not qualify as a small loan under section 104 of this
	1109	+	29 chapter;
	1110	+	30 (b) is for a term shorter than that specified in section 401(1) of
	1111	+	31 this chapter; or
	1112	+	32 (c) is made in violation of section 201, 401, 402, 404, or 410 of
	1113	+	33 this chapter;
	1114	+	34 is subject to this article. The department may conform the loan finance
	1115	+	35 charge for a loan described in this subsection to the limitations set forth
	1116	+	36 in IC 24-4.5-3-508(2). IC 24-4.5-3-201(1)(b).
	1117	+	37 (7) Notwithstanding IC 24-4.5-1-301.5, for purposes of subsection
	1118	+	38 (2), a person "regularly engages" in any of the activities described in
	1119	+	39 subsection (2) with respect to a small loan if the person:
	1120	+	40 (a) performed any of the activities described in subsection (2)
	1121	+	41 with respect to a small loan at least one (1) time in the preceding
	1122	+	42 calendar year; or
	1123	+	2022 IN 352—LS 6946/DI 101 26
	1124	+	1 (b) performs or will perform any of the activities described in
	1125	+	2 subsection (2) with respect to a small loan at least one (1) time in
	1126	+	3 the current calendar year if the person did not perform any of the
	1127	+	4 activities described in subsection (2) with respect to a small loan
	1128	+	5 at least one (1) time in the preceding calendar year.
	1129	+	6 SECTION 15. IC 24-4.5-7-104, AS AMENDED BY P.L.216-2013,
	1130	+	7 SECTION 13, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
	1131	+	8 JULY 1, 2022]: Sec. 104. (1) "Small loan" means a loan:
	1132	+	9 (a) with a principal loan amount that is at least fifty dollars ($50)
	1133	+	10 and not more than five hundred fifty dollars ($550); and
	1134	+	11 (b) in which the lender holds the borrower's check for a specific
	1135	+	12 period, or receives the borrower's written authorization to debit
	1136	+	13 the borrower's account (other than as a result of default) under an
	1137	+	14 agreement, either express or implied, for a specific period, before
	1138	+	15 the lender:
	1139	+	16 (i) offers the check for deposit or presentment; or
	1140	+	17 (ii) exercises the authorization to debit the borrower's account.
	1141	+	18 (2) The amount of five hundred fifty dollars ($550) in subsection
	1142	+	19 (1)(a) is subject to change under the provisions on adjustment of dollar
	1143	+	20 amounts (IC 24-4.5-1-106). However, notwithstanding
	1144	+	21 IC 24-4.5-1-106(1), the Reference Base Index to be used under this
	1145	+	22 subsection is the Index for October 2006.
	1146	+	23 (3) Notwithstanding:
	1147	+	24 (a) IC 24-4.5-3-508.1(3); and
	1148	+	25 (b) IC 24-4.5-3-508.1(14);
	1149	+	26 a supervised loan made under IC 24-4.5-3-508.1 after June 30,
	1150	+	27 2022, is not considered a small loan that is subject to this chapter
	1151	+	28 if the supervised loan is made in compliance with IC 24-4.5-3-508.1.
	1152	+	29 SECTION 16. IC 24-4.5-7-411 IS AMENDED TO READ AS
	1153	+	30 FOLLOWS [EFFECTIVE JULY 1, 2022]: Sec. 411. Finance charges
	1154	+	31 made in compliance with this chapter are exempt from:
	1155	+	32 (a) IC 24-4.5-3-508, in the case of a small loan made before
	1156	+	33 July 1, 2022;
	1157	+	34 (b) IC 24-4.5-3-508.1, in the case of a small loan made after
	1158	+	35 June 30, 2022; and
	1159	+	36 (c) IC 35-45-7.
	1160	+	37 SECTION 17. IC 28-7-5-28 IS AMENDED TO READ AS
	1161	+	38 FOLLOWS [EFFECTIVE JULY 1, 2022]: Sec. 28. (a) The maximum
	1162	+	39 rate of interest charged by pawnbrokers shall be the same as the
	1163	+	40 maximum loan finance charge for supervised lenders under
	1164	+	41 IC 24-4.5-3-508(2). consumer loans set forth in
	1165	+	42 IC 24-4.5-3-201(1)(b). For purposes of this subsection:
	1166	+	2022 IN 352—LS 6946/DI 101 27
	1167	+	1 (1) the term of a loan commences on the date on which the loan
	1168	+	2 is made;
	1169	+	3 (2) differences in lengths of months are disregarded; and
	1170	+	4 (3) each day is counted as one-thirtieth (1/30) of a month.
	1171	+	5 The minimum term of a loan made by a pawnbroker is one (1) month.
	1172	+	6 However, on loans paid in full within the first month, the pawnbroker
	1173	+	7 may charge one (1) month's interest.
	1174	+	8 (b) Interest shall not be deducted in advance, neither shall the
	1175	+	9 pawnbroker induce or permit any borrower to split up or divide any
	1176	+	10 loan or loans for the purpose of evading any provisions of this chapter.
	1177	+	11 (c) If a pawnbroker charges or receives interest in excess of that
	1178	+	12 provided in this section, or makes any charges not authorized by this
	1179	+	13 chapter, the pawnbroker shall forfeit principal and interest and return
	1180	+	14 the pledge upon demand of the pledger and surrender of the pawn
	1181	+	15 ticket without the principal or interest. If such excessive or
	1182	+	16 unauthorized charges have been paid by the pledger, the pledger may
	1183	+	17 recover the same, including the principal if paid, in a civil action
	1184	+	18 against the pawnbroker.
	1185	+	19 SECTION 18. IC 35-45-7-2, AS AMENDED BY P.L.158-2013,
	1186	+	20 SECTION 536, IS AMENDED TO READ AS FOLLOWS
	1187	+	21 [EFFECTIVE JULY 1, 2022]: Sec. 2. A person who, in exchange for
	1188	+	22 the loan of any property, knowingly or intentionally receives or
	1189	+	23 contracts to receive from another person any consideration, at a rate
	1190	+	24 greater than two (2) times the rate specified in IC 24-4.5-3-508(2)(a)(i),
	1191	+	25 IC 24-4.5-3-201(1)(b), commits loansharking, a Level 6 felony.
	1192	+	26 However, loansharking is a Level 5 felony if force or the threat of force
	1193	+	27 is used to collect or to attempt to collect any of the property loaned or
	1194	+	28 any of the consideration for the loan.
	1195	+	2022 IN 352—LS 6946/DI 101