Maryland 2024 Regular Session

Maryland Senate Bill SB509 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1	1
2	2
3	3		EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
4	4		[Brackets] indicate matter deleted from existing law.
5		-	Underlining indicates amendments to bill.
6		-	Strike out indicates matter stricken from the bill by amendment or deleted from the law by
7		-	amendment.
8	5		sb0509
9	6
10	7		SENATE BILL 509
11	8		I1 4lr1804
12	9		SB 496/23 – FIN CF HB 574
13	10		By: Senator Kramer
14	11		Introduced and read first time: January 24, 2024
15	12		Assigned to: Finance
16		-	Committee Report: Favorable with amendments
17		-	Senate action: Adopted
18		-	Read second time: February 17, 2024
19	13
20		-	~~CHAPTER ______~~
	14	+	A BILL ENTITLED
21	15
22	16		AN ACT concerning 1
23	17
24	18		Commercial Financing – Small Business Truth in Lending Act 2
25	19
26	20		FOR the purpose of regulating commercial financing transactions, including by 3
27	21		establishing requirements related to disclosures, calculations of annual percentage 4
28	22		rates, terms of repayments, and other related items, and the extension of specific 5
29	23		offers; and generally relating to commercial financing transactions. 6
30	24
31	25		BY adding to 7
32	26		Article – Financial Institutions 8
33	27		Section 12–1201 through 12–1214 to be under the new subtitle “Subtitle 12. 9
34	28		Commercial Financing” 10
35	29		Annotated Code of Maryland 11
36	30		(2020 Replacement Volume and 2023 Supplement) 12
37	31
38	32		SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 13
39	33		That the Laws of Maryland read as follows: 14
40	34
41	35		Article – Financial Institutions 15
42	36
43	37		SUBTITLE 12. COMMERCIAL FINANCING. 16
44	38
45	39		12–1201. 17
46	40
47	41		(A) IN THIS SUBTITLE THE FOLLOWING WORDS HAVE THE MEANINGS 18
48		-	INDICATED. 19 2 SENATE BILL 509
	42	+	INDICATED. 19
	43	+
	44	+	(B) (1) “CLOSED–END FINANCING ” MEANS A CLOSED –END EXTENSION OF 20
	45	+	CREDIT, SECURED OR UNSECURED , INCLUDING EQUIPMENT FINANCING, THAT: 21
	46	+	2 SENATE BILL 509
	47	+
	48	+
	49	+	(I) DOES NOT MEET THE DEF INITION OF A LEASE U NDER 1
	50	+	ARTICLE 2A OF THE UNIFORM COMMERCIAL CODE; AND 2
	51	+
	52	+	(II) THE PROCEEDS OF WHICH A RECIPIENT DOES NOT INTEND 3
	53	+	TO USE PRIMARILY FOR PERSONAL, FAMILY, OR HOUSEHOLD PURPOSE S. 4
	54	+
	55	+	(2) “CLOSED–END FINANCING ” INCLUDES FINANCING THAT H AS AN 5
	56	+	ESTABLISHED PRINCIPA L AMOUNT AND DURATIO N. 6
	57	+
	58	+	(C) “COMMERCIAL FINANCING ” MEANS OPEN –END FINANCING , 7
	59	+	CLOSED–END FINANCING , SALES–BASED FINANCING , A FACTORING TRANSACT ION, 8
	60	+	OR ANOTHER FORM OF F INANCING, THE PROCEEDS OF WHIC H THE RECIPIENT DOES 9
	61	+	NOT INTEND TO USE PR IMARILY FOR PERSONAL , FAMILY, OR HOUSEHOLD 10
	62	+	PURPOSES. 11
	63	+
	64	+	(D) “FACTORING TRANSACTION ” MEANS AN ACCOUNTS RECEIVABLE 12
	65	+	PURCHASE TRANSACTION : 13
	66	+
	67	+	(1) THAT INCLUDES AN AGRE EMENT TO PURCHASE , TRANSFER, OR 14
	68	+	SELL A LEGALLY ENFOR CEABLE CLAIM FOR PAY MENT HELD BY A RECIP IENT FOR 15
	69	+	GOODS THE RECIPIENT HAS SUPPLIED OR SERV ICES THE RECIPIENT H AS RENDERED 16
	70	+	THAT HAVE BEE N ORDERED BUT FOR WH ICH PAYMENT HAS NOT BEEN MADE; AND 17
	71	+
	72	+	(2) THE PROCEEDS OF WHICH THE RECIPIENT DOES N OT INTEND TO 18
	73	+	USE PRIMARILY FOR PE RSONAL, FAMILY, OR HOUSEHOLD PURPOSE S. 19
	74	+
	75	+	(E) (1) “FINANCE CHARGE ” MEANS THE COST OF CO MMERCIAL 20
	76	+	FINANCING REPRESENTE D AS A DOLLAR AMOUNT . 21
	77	+
	78	+	(2) “FINANCE CHARGE ” INCLUDES: 22
	79	+
	80	+	(I) A CHARGE PAYABLE DIREC TLY OR INDIRECTLY BY A 23
	81	+	RECIPIENT AND IMPOSE D DIRECTLY OR INDIRE CTLY BY A PROVIDER A S AN 24
	82	+	INCIDENT TO OR A CON DITION OF THE EXTENS ION OF COMMERCIAL FI NANCING; 25
	83	+
	84	+	(II) A CHARGE THAT WOULD BE INCLUD ED UNDER 12 C.F.R. § 26
	85	+	1026.4 IF A TRANSACTION WER E SUBJECT TO 12 C.F.R. § 1026.4; AND 27
	86	+
	87	+	(III) ANY ADDITIONAL CHARGE S DETERMINED BY THE 28
	88	+	COMMISSIONER . 29
	89	+
	90	+	(F) (1) “OPEN–END FINANCING ” MEANS AN AGREEMENT F OR ONE OR 30
	91	+	MORE EXTENSIONS OF S ECURED OR UNSECURED OPE N–END CREDIT , THE 31 SENATE BILL 509 3
	92	+
	93	+
	94	+	PROCEEDS OF WHICH A RECIPIENT DOES NOT I NTEND TO USE PRIMARI LY FOR 1
	95	+	PERSONAL, FAMILY, OR HOUSEHOLD PURPOSE S. 2
	96	+
	97	+	(2) “OPEN–END FINANCING ” INCLUDES CREDIT EXTE NDED BY A 3
	98	+	PROVIDER UNDER A PLA N IN WHICH: 4
	99	+
	100	+	(I) THE PROVIDER REASONABLY CONTEMPLA TES REPEATED 5
	101	+	TRANSACTIONS ; 6
	102	+
	103	+	(II) THE PROVIDER MAY IMPO SE A FINANCE CHARGE ON AN 7
	104	+	OUTSTANDING UNPAID B ALANCE; AND 8
	105	+
	106	+	(III) THE AMOUNT OF CREDIT THAT MAY BE EXTENDED TO A 9
	107	+	RECIPIENT DURING THE TERM OF THE PLAN , UP TO A LIMIT THAT T HE PROVIDER 10
	108	+	SETS, IS GENERALLY MADE AV AILABLE TO THE EXTEN T THAT ANY OUTSTANDI NG 11
	109	+	BALANCE IS REPAID . 12
	110	+
	111	+	(G) (1) “PROVIDER” MEANS A PERSON THAT EXTENDS A SPECIFIC O FFER 13
	112	+	OF COMMERCIAL FINANC ING TO A RECIPIENT . 14
	113	+
	114	+	(2) “PROVIDER” INCLUDES A PERSON TH AT SOLICITS AND PRESENTS 15
	115	+	A SPECIFIC OFFER OF COMMERCIAL FINANCING ON BEHALF OF A THIRD PARTY. 16
	116	+
	117	+	(H) (1) “RECIPIENT” MEANS A PERSON , OR THE PERSON ’S AUTHORIZED 17
	118	+	REPRESENTATIVE , THAT APPLIES FOR COM MERCIAL FINANCING AN D IS MADE A 18
	119	+	SPECIFIC OFFER OF CO MMERCIAL FINANCING B Y A PROVIDER. 19
	120	+
	121	+	(2) “RECIPIENT” DOES NOT INCLUDE A P ERSON ACTING AS A 20
	122	+	BROKER. 21
	123	+
	124	+	(I) (1) “SALES–BASED FINANCING ” MEANS A TRANSACTION : 22
	125	+
	126	+	(I) THAT IS REPAID BY A RECIPIENT TO A PROVID ER OVER TIME 23
	127	+	AS A PERCENTAGE OF S ALES OR REVENUE , IN WHICH THE PAYMENT AMOUNT MAY 24
	128	+	INCREASE OR DECREASE ACCORDING TO THE VOL UME OF SALES MADE OR REVENUE 25
	129	+	RECEIVED BY THE RECI PIENT; AND 26
	130	+
	131	+	(II) THE PROCEEDS OF WHICH THE RECIPIENT DOES N OT 27
	132	+	INTEND TO USE PRIMAR ILY FOR PERSONAL , FAMILY, OR HOUSEHOLD PURPOSE S. 28
	133	+
	134	+	(2) “SALES–BASED FINANCIN G” INCLUDES A TRANSACTI ON 29
	135	+	CONTAINING A TRUE –UP MECHANISM UNDER W HICH THE FINANCING I S REPAID AS 30
	136	+	A FIXED PAYMENT BUT PROVIDES FOR A RECON CILIATION PROCESS TH AT ADJUSTS 31
	137	+	THE PAYMENT TO AN AM OUNT THAT IS A PERCE NTAGE OF SALES OR RE VENUE. 32 4 SENATE BILL 509
49	138
50	139
51	140
52		-	(B) (1) “CLOSED–END FINANCING” MEANS A CLOSED –END EXTENSION OF 1
53		-	CREDIT, SECURED OR UNSECURED , INCLUDING EQUIPMENT FINANCING, THAT: 2
	141	+	(J) “SPECIFIC OFFER ” MEANS THE TERMS OF C OMMERCIAL FINANCING 1
	142	+	THAT ARE QUOTED TO A RECIPIENT, BASED ON INFORMATION OBTAINED FROM OR 2
	143	+	ABOUT THE RECIPIENT , WHICH IF ACCEPTED BY THE RECIPIENT ARE BI NDING ON A 3
	144	+	PROVIDER, AS APPLICABLE, SUBJECT TO REQUIREME NTS STATED IN THE TE RMS OF 4
	145	+	THE COMMERCIAL FINAN CING. 5
54	146
55		-	(I) DOES NOT MEET THE DEF INITION OF A LEASE U NDER 3
56		-	ARTICLE 2A OF THE UNIFORM COMMERCIAL CODE; AND 4
	147	+	12–1202. 6
57	148
58		-	(II) THE PROCEEDS OF WHICH A RECIPIENT DO ES NOT INTEND 5
59		-	TO USE PRIMARILY FOR PERSONAL, FAMILY, OR HOUSEHOLD PURPOSE S. 6
	149	+	THIS SUBTITLE DOES NO T APPLY TO: 7
60	150
61		-	(2) ~~“CLOSED–END FINANCING ” INCLUDES FINANCING T HAT HAS AN 7~~
62		-	~~ESTABLISHED PRINCIPA L AMOUNT AND DURATIO N. 8~~
	151	+	(1) (I) A FEDERAL OR STATE BANK, CREDIT UNION , OR SAVINGS 8
	152	+	ASSOCIATION; OR 9
63	153
64		-	(C) “COMMERCIAL FINANCING ” MEANS OPEN –END FINANCING , 9
65		-	CLOSED–END FINANCING , SALES–BASED FINANCING , A FACTORING TRANSACT ION, 10
66		-	OR ANOTHER FORM OF F INANCING, THE PROCEEDS OF WHIC H THE RECIPIENT DOES 11
67		-	NOT INTEND TO USE PR IMARILY FOR PERSONAL , FAMILY, OR HOUSEHOLD 12
68		-	PURPOSES. 13
	154	+	(II) A SUBSIDIARY OR AFFILI ATE OF AN ORGANIZATI ON LISTED 10
	155	+	IN ITEM (I) OF THIS ITEM; 11
69	156
70		-	(D) “FACTORING TRANSACTION ” MEANS AN ACCOUNTS RE CEIVABLE 14
71		-	PURCHASE TRANSACTION : 15
	157	+	(2) A PERSON ACTIN G AS A TECHNOLOGY SE RVICES PROVIDER TO A N 12
	158	+	ENTITY EXEMPT UNDER THIS SECTION FOR USE AS PART OF THE ENTIT Y’S 13
	159	+	COMMERCIAL FINANCING PROGRAM IF THE PERSO N DOES NOT HAVE AN I NTEREST, 14
	160	+	ARRANGEMENT , OR AGREEMENT TO PURC HASE ANY INTEREST IN THE COMMERCIAL 15
	161	+	FINANCING EXTENDED BY THE ENTI TY IN CONNECTION WIT H THE COMMERCIAL 16
	162	+	FINANCING PROGRAM ; 17
72	163
73		-	(1) THAT INCLUDES AN AGRE EMENT TO PURCHASE , TRANSFER, OR 16
74		-	SELL A LEGALLY ENFOR CEABLE CLAIM FOR PAY MENT HELD BY A RECIP IENT FOR 17
75		-	GOODS THE RECIPIENT HAS SUPPLIED OR SERV ICES THE RECIPIENT H AS RENDERED 18
76		-	THAT HAVE BEEN ORDER ED BUT FOR WHIC H PAYMENT HAS NOT BE EN MADE; AND 19
	164	+	(3) A LENDER REGULATED UND ER THE FEDERAL FARM CREDIT ACT; 18
77	165
78		-	(2) ~~THE PROCEEDS OF WHICH THE RECIPIENT DOES N OT INTEND TO 20~~
79		-	~~USE PRIMARILY FOR PE RSONAL, FAMILY, OR HOUSEHOLD PURPOSE S. 21~~
	166	+	(4) A COMMERCIAL FINANCING TRANSACTION SECURED BY REAL 19
	167	+	PROPERTY; 20
80	168
81		-	(E) ~~(1) “FINANCE~~ ~~CHARGE ” MEANS~~ THE ~~COST OF CO MMERCIAL 22~~
82		-	~~FINANCING REPRESENTE D AS A DOLLAR AMOUNT . 23~~
	169	+	(5) A LEASE AS DEFINED IN ARTICLE 2A OF THE UNIFORM 21
	170	+	COMMERCIAL CODE; 22
83	171
84		-	(2) “FINANCE CHARGE ” INCLUDES: 24
	172	+	(6) A PROVIDER OR OTHER PE RSON WHO MAKES NOT M ORE THAN 23
	173	+	FIVE COMMERCIAL FINA NCING TRANSACTIONS I N THE STATE IN A 12–MONTH 24
	174	+	PERIOD; 25
85	175
86		-	(I) A CHARGE PAYABLE DIREC TLY OR INDIRECTLY BY A 25
87		-	RECIPIENT AND IMPOSE D DIRECTLY OR INDIRE CTLY BY A PROVIDER A S AN 26
88		-	INCIDENT TO OR A CON DITION OF THE EXTENS ION OF COMMERCIAL FI NANCING; 27
	176	+	(7) A COMMERCIAL FINANCING TRANSACTION MORE THA N 26
	177	+	$2,500,000; 27
89	178
90		-	(II) A CHARGE THAT WOULD BE INCLUDED UNDER 12 C.F.R. § 28
91		-	1026.4 IF A TRANSACTION WER E SUBJECT TO 12 C.F.R. § 1026.4; AND 29
	179	+	(8) A COMMERCIAL FINANCING TRANSACTION: 28
92	180
93		-	(III) ANY ADDITIONAL CHARGE S DETERMINED BY THE 30
94		-	COMMISSIONER . 31 SENATE BILL 509 3
	181	+	(I) IN WHICH THE RECIPIEN T IS: 29
	182	+	SENATE BILL 509 5
	183	+
	184	+
	185	+	1. A DEALER, OR AN AFFILIATE OF A DEALER, AS 1
	186	+	DEFINED IN § 11–111 OF THE TRANSPORTATION ARTICLE; OR 2
	187	+
	188	+	2. A RENTAL VEHICLE COMPA NY, OR AN AFFILIATE OF A 3
	189	+	RENTAL VEHICLE COMPA NY, AS DEFINED IN § 18–108 OF THE TRANSPORTATION 4
	190	+	ARTICLE; AND 5
	191	+
	192	+	(II) MADE UNDER A COMMERCI AL FINANCING AGREEME NT OR 6
	193	+	COMMERCIAL OPEN –END CREDIT PLAN OF A T LEAST $50,000, INCLUDING A 7
	194	+	COMMERCIAL LOAN MADE IN ACCORDANCE WITH T HE COMMERCIAL FINANC ING 8
	195	+	TRANSACTION ; OR 9
	196	+
	197	+	(9) A COMMERCIAL FINAN CING TRANSACTION THA T IS A FACTORING 10
	198	+	TRANSACTION , AN ADVANCE , OR A SIMILAR TRANSAC TION OF ACCOUNTS 11
	199	+	RECEIVABLE OWED TO A HEALTH CARE PROVIDER BECAUSE OF A PATIENT ’S 12
	200	+	PERSONAL INJURY TREA TED BY THE HEALTH CA RE PROVIDER. 13
	201	+
	202	+	12–1203. 14
	203	+
	204	+	(A) EXCEPT AS PROVIDED IN § 12–1207 OF THIS SUBTITLE , FOR PURPOSES 15
	205	+	OF THIS SUBTITLE, AN ANNUAL PERCENTAGE RATE SHALL BE: 16
	206	+
	207	+	(1) EXPRESSED AS A YEARLY RATE, INCLUDING ALL FEES A ND 17
	208	+	FINANCE CHARGES ; AND 18
	209	+
	210	+	(2) CALCULATED IN ACCORDA NCE WITH THE FEDERAL TRUTH IN 19
	211	+	LENDING ACT. 20
	212	+
	213	+	(B) IN ADDITION TO THE REQU IREMENTS OF SUBSECTI ON (A)(2) OF THIS 21
	214	+	SECTION, AN ANNUAL PERCENTAGE RATE SHALL BE CALCUL ATED BASED ON THE 22
	215	+	ESTIMATED TERM OF RE PAYMENT AND THE PROJ ECTED PERIODIC PAYME NT 23
	216	+	AMOUNTS OF A COMMERC IAL FINANCING TRANSA CTION, REGARDLESS OF WHETHE R 24
	217	+	FEDERAL LAW OR REGUL ATION WOULD REQUIRE AN ANNUAL PERCENTAGE RATE TO 25
	218	+	BE CALCULATED FOR A CERTAIN TRANSACTION . 26
	219	+
	220	+	(C) THIS SECTION MAY NOT BE CONSTRUED TO IMPO SE ANY LIABILITY ON A 27
	221	+	PROVIDER THAT CHARGES AN ANNUAL PERCENTAGE RATE THAT DIFFERS FROM THE 28
	222	+	ESTIMATED ANNUAL PER CENTAGE RATE DISCLOSED BY THE PROVIDER IN 29
	223	+	ACCORDANCE WITH THIS SUBTITLE OR ANY REGULATION ADOPTED U NDER THIS 30
	224	+	SUBTITLE. 31
	225	+
	226	+	12–1204. 32
	227	+	6 SENATE BILL 509
	228	+
	229	+
	230	+	(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 1
	231	+	INDICATED. 2
	232	+
	233	+	(2) “ESTIMATED TERM OF REP AYMENT” MEANS THE AMOUNT OF 3
	234	+	TIME REQUIRED FOR TH E PERIODIC PAYMENTS MADE BY A RECIPIENT IN A 4
	235	+	SALES–BASED FINANCING TRAN SACTION TO EQUAL THE TOTAL AMOUNT REQUIRE D 5
	236	+	TO BE REPAID. 6
	237	+
	238	+	(3) “TOTAL REPAYMENT AMOUN T” MEANS THE DISBURSEME NT 7
	239	+	AMOUNT OF A SALES–BASED FINANCING TRAN SACTION PLUS THE FIN ANCE CHARGE . 8
	240	+
	241	+	(B) (1) A PROVIDER SHALL DISCL OSE THE FOLLOWING IN FORMATION TO 9
	242	+	A RECIPIENT WHEN EXT ENDING A SPECIFIC OF FER OF SALES–BASED FINANCING : 10
	243	+
	244	+	(I) THE TOTAL AMOUNT OF T HE SALES–BASED FINANCIN G AND 11
	245	+	THE DISBURSEMENT AMO UNT, IF DIFFERENT FROM TH E FINANCING AMOUNT , 12
	246	+	MINUS ANY FEES DEDUC TED OR WITHHELD AT D ISBURSEMENT ; 13
	247	+
	248	+	(II) THE FINANCE CHARGE ; 14
	249	+
	250	+	(III) THE ESTIMATED ANNUAL PERCENTAGE RATE OF T HE 15
	251	+	SALES–BASED FINANCING , USING THE WORDS “ANNUAL PERCENTAGE RATE ” OR THE 16
	252	+	ABBREVIATION “APR”; 17
	253	+
	254	+	(IV) THE TOTAL REPAYMENT A MOUNT; 18
	255	+
	256	+	(V) THE ESTIMATED TERM OF REPAYMENT ; 19
	257	+
	258	+	(VI) SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION , THE 20
	259	+	PROJECTED PERIODIC P AYMENT AMOUNTS ; 21
	260	+
	261	+	(VII) A DESCRIPTION OF ANY O THER POTENTIAL FEES AND 22
	262	+	CHARGES NOT INCLUDED IN THE FINANCE CHARG E, INCLUDING DRAW FEES , LATE 23
	263	+	PAYMENT FEES , AND RETURNED PAYMENT FEES; AND 24
	264	+
	265	+	(VIII) IF APPLICABLE , A DESCRIPTION OF COL LATERAL 25
	266	+	REQUIREMENTS OR SECU RITY INTERESTS. 26
	267	+
	268	+	(2) (I) FOR PAYMENT AMOUNTS T HAT ARE FIXED , A PROVIDER 27
	269	+	SHALL DISCLOSE : 28
	270	+
	271	+	1. THE PAYMENT AMOUNTS A ND FREQUENCY ; AND 29
	272	+	SENATE BILL 509 7
	273	+
	274	+
	275	+	2. IF THE PAYMENT FREQUE NCY IS OTHER THAN 1
	276	+	MONTHLY, THE AMOUNT OF THE AV ERAGE PROJECTED PAYM ENTS PER MONTH . 2
	277	+
	278	+	(II) FOR PAYMENT AMOUNTS T HAT ARE VARIABLE , A PROVIDER 3
	279	+	SHALL DISCLOSE : 4
	280	+
	281	+	1. THE PAYMENT SCHEDULE OR A DESCRIPTION OF THE 5
	282	+	METHOD USED TO CALCU LATE THE AMOUNTS AND FREQUENCY OF PAYMENT S; AND 6
	283	+
	284	+	2. THE AMOUNT OF THE AVE RAGE PROJECTED 7
	285	+	PAYMENTS PER MONTH . 8
	286	+
	287	+	(C) (1) IF A RECIPIENT PAYS O FF OR REFINANCE S THE SALES–BASED 9
	288	+	FINANCING BEFORE THE END OF THE SCHEDULED REPAYMENT PERIOD , A 10
	289	+	PROVIDER SHALL DISCL OSE WHETHER THE RECI PIENT WOULD BE REQUI RED TO 11
	290	+	PAY: 12
	291	+
	292	+	(I) ANY FINANCE CHARGES O THER THAN THE INTERE ST 13
	293	+	ACCRUED SINCE THE RE CIPIENT’S LAST PAYMENT ; AND 14
	294	+
	295	+	(II) ANY ADDITIONAL FEES N OT INCLUDED IN THE F INANCE 15
	296	+	CHARGE. 16
	297	+
	298	+	(2) IF A RECIPIENT WOULD BE REQUIRED TO PAY A DDITIONAL 17
	299	+	FINANCE CHARGES OTHE R THAN THE INTEREST ACCRUED SINCE THE RE CIPIENT’S 18
	300	+	LAST PAYMENT , A PROVIDER SHALL DIS CLOSE THE PERCENTAGE OF ANY UNPAI D 19
	301	+	PORTION OF THE FINAN CE CHARGE AND THE MA XIMUM DOLLAR AMOUNT THE 20
	302	+	RECIPIENT COULD BE R EQUIRED TO PAY . 21
	303	+
	304	+	12–1205. 22
	305	+
	306	+	(A) (1) A PROVIDER SHALL USE T HE PROJECTED SALES V OLUME OF A 23
	307	+	RECIPIENT TO CALCULA TE THE FOLLOWING INF ORMATION RELATED TO A 24
	308	+	SALES–BASED FINANCING TRANSACTIO N: 25
	309	+
	310	+	(I) THE ESTIMATED TERM OF REPAYMENT AND THE 26
	311	+	PROJECTED PAYMENT AM OUNTS OF A SALES–BASED FINANCING TRAN SACTION; AND 27
	312	+
	313	+	(II) THE ESTIMATED ANNUAL PERCENTAGE RATE OF A 28
	314	+	SALES–BASED FINANCING TRAN SACTION. 29
	315	+
	316	+	(2) THE ESTIMATED ANNUAL PERCENTAGE RATE OF A SALES–BASED 30
	317	+	FINANCING TRANSACTIO N SHALL BE CALCULATE D: 31
	318	+	8 SENATE BILL 509
	319	+
	320	+
	321	+	(I) IN ACCORDANCE WITH TH E FEDERAL TRUTH IN LENDING 1
	322	+	ACT AND REGULATION Z, 12 C.F.R. § 1026.22; AND 2
	323	+
	324	+	(II) BASED ON THE ESTIMATE D TERM OF REPAYMENT AND 3
	325	+	PROJECTED SALES VOLU ME OF A RECIPIENT. 4
	326	+
	327	+	(B) (1) A PROVIDER MAY CALCULA TE THE PROJECTED SAL ES VOLUME OF 5
	328	+	A RECIPIENT USING EI THER THE HISTORICAL METHOD OR THE OPT –IN METHOD. 6
	329	+
	330	+	(2) (I) A PROVIDER THAT USES T HE HISTORICAL METHOD TO 7
	331	+	CALCULATE THE PROJEC TED SALES VOLUME OF A RECIPIENT SHALL USE AN 8
	332	+	AVERAGE HISTORICAL V OLUME OF SALES OR RE VENUE. 9
	333	+
	334	+	(II) A PROVIDER SHALL FIX T HE HISTORICAL TIME P ERIOD 10
	335	+	USED TO CALCULATE TH E AVERAGE HISTORICAL VOLUME AND USE THE S AME TIME 11
	336	+	PERIOD FOR ALL DISCL OSURE PURPOSES FOR A NY SALES–BASED FINANCING 12
	337	+	TRANSACTION PRODUCTS OFFERED. 13
	338	+
	339	+	(III) EXCEPT AS PROVIDED IN SUBPARAGRAPH (IV) OF THIS 14
	340	+	PARAGRAPH , THE FIXED HISTORICAL TIME PERIOD: 15
	341	+
	342	+	1. MAY NOT BE LESS THAN 1 MONTH AND MAY NOT 16
	343	+	EXCEED 12 MONTHS; AND 17
	344	+
	345	+	2. SHALL BE THE TIME PER IOD DIRECTLY BEFORE THE 18
	346	+	SPECIFIC OFFER WAS M ADE. 19
	347	+
	348	+	(IV) A PROVIDER MAY CHOOSE TO USE THE AVERAGE S ALES FOR 20
	349	+	THE SAME NUMBER OF M ONTHS AS THE PROVIDE R WOULD HAVE USED UN DER 21
	350	+	SUBPARAGRAPH (III) OF THIS PARAGRAPH WI TH THE HIGHEST SALES VOLUME 22
	351	+	WITHIN THE PAST 12 MONTHS. 23
	352	+
	353	+	(3) A PROVIDER MAY USE THE OPT–IN METHOD TO DETERMI NE THE 24
	354	+	INFORMATION LISTED U NDER SUBSECTION (A)(1) OF THIS SECTION BY U SING A 25
	355	+	PROJECTED SALES VOLU ME THAT THE PROVIDER CHOOSES FOR EACH DIS CLOSURE 26
	356	+	IF THE RECIPIENT PAR TICIPATES IN A REVIE W PROCESS ESTABLISHE D BY THE 27
	357	+	COMMISSIONER . 28
	358	+
	359	+	(C) A PROVIDER SHALL NOTIF Y THE COMMISSIONER WHICH OF THE TWO 29
	360	+	METHODS THE PROVIDER INTENDS TO USE WHEN CALCULATING THE ESTI MATED 30
	361	+	ANNUAL PERCENTAGE OF EACH SALES–BASED FINANCING TRAN SACTION. 31
	362	+
	363	+	(D) (1) ON OR BEFORE JANUARY 1 EACH YEAR, A PROVIDER SHALL 32
	364	+	REPORT TO THE COMMISSIONER ON : 33 SENATE BILL 509 9
95	365
96	366
97	367
98		-	(F) (1) “OPEN–END FINANCING ” MEANS AN AGREEMENT F OR ONE OR 1
99		-	MORE EXTENSIONS OF SECURED OR UNSECU RED OPEN –END CREDIT , THE 2
100		-	PROCEEDS OF WHICH A RECIPIENT DOES NOT I NTEND TO USE PRIMARI LY FOR 3
101		-	PERSONAL, FAMILY, OR HOUSEHOLD PURPOSE S. 4
	368	+	(I) THE ESTIMATED ANNUAL PERCENTAGE RATES GIV EN TO 1
	369	+	EACH RECIPIENT ; AND 2
102	370
103		-	(2) ~~“OPEN–END FINANCING ” INCLUDES CREDIT EXTE NDED BY A 5~~
104		-	~~PROVIDER UNDER A PLA N IN WHICH:~~ 6
	371	+	(II) THE ACTUAL ANNUAL PER CENTAGE RATES OF EAC H 3
	372	+	COMPLETED SALES –BASED FINANCING TRAN SACTION. 4
105	373
106		-	(I) THE PROVIDER REASONABLY CONTEMPLATES REPEATE D 7
107		-	TRANSACTIONS ; 8
	374	+	(2) (I) THE REPORT REQUIRED U NDER PARAGRAPH (1) OF THIS 5
	375	+	SUBSECTION SHALL CON TAIN ANY INFORMATION THE COMMISSIONER CONSIDER S 6
	376	+	NECESSARY TO DETERMI NE WHETHER THE DEVIA TION BETWEEN THE EST IMATED 7
	377	+	ANNUAL PERCENTAGE RA TES AND ACTUAL ANNUA L PERCENTAGE RATES O F 8
	378	+	COMPLETED SALES –BASED FINANCING TRAN SACTIONS IS REASONAB LE. 9
108	379
109		-	(II) THE PROVIDER MAY IMPO SE A FINANCE CHARGE ON AN 9
110		-	OUTSTANDING UNPAID B ALANCE; AND 10
	380	+	(II) THE COMMISSIONER MAY CONS IDER EXTRAORDINARY 10
	381	+	CIRCUMSTANCES WHEN D ETERMINING WHETHER T HE PROVIDER ’S DEVIATION 11
	382	+	BETWEEN THE ESTIMATE D ANNUAL PERCENTAGE RATE AND ACTUAL ANNU AL 12
	383	+	PERCENTAGE RATE OF A SALES–BASED FINANCING TRAN SACTION IS REASONABLE . 13
111	384
112		-	(III) THE AMOUNT OF CREDIT THAT MAY BE EXTENDED TO A 11
113		-	RECIPIENT DURING THE TERM OF THE PLAN , UP TO A LIMIT THAT THE PROVIDER 12
114		-	SETS, IS GENERALLY MADE AV AILABLE TO THE EXTEN T THAT ANY OUTSTANDI NG 13
115		-	BALANCE IS REPAID . 14
	385	+	(III) IF THE COMMISSIONER FINDS TH AT THERE WAS AN 14
	386	+	UNREASONABLE DEVIATI ON BETWEEN ESTIMATED AND ACTUAL ANNUAL 15
	387	+	PERCENTAGE RATES OF SALES–BASED FINANCING TRAN SACTIONS, THE 16
	388	+	COMMISSIONER MAY REQU IRE THE PROVIDER TO USE THE HISTORICAL M ETHOD 17
	389	+	INSTEAD OF THE OPT –IN METHOD IN DETERMI NING THE PROJECTED S ALES VOLUME 18
	390	+	OF THE RECIPIENT . 19
116	391
117		-	(G) (1) “PROVIDER” MEANS A PERSON THAT EXTENDS A SPECIFIC O FFER 15
118		-	OF COMMERCIAL FINANC ING TO A RECIPIENT . 16
	392	+	12–1206. 20
119	393
120		-	(2) “PROVIDER” INCLUDES A PERSON TH AT SOLICITS AND PRESENTS 17
121		-	A SPECIFIC OFFER OF COMMERCIAL FINANCING ON BEHALF OF A THIRD PARTY. 18
	394	+	(A) IN THIS SECTION , “TOTAL REPAYMENT AMOU NT” MEANS THE 21
	395	+	DISBURSEMENT AMOUNT OF A CLOSED–END FINANCING TRANSA CTION PLUS THE 22
	396	+	FINANCE CHARGE . 23
122	397
123		-	(H) (1) “RECIPIENT” MEANS A PERSON , OR THE PERSON ’S AUTHORIZED 19
124		-	REPRESENTATIVE , THAT APPLIES FOR COM MERCIAL FINANCING AN D IS MADE A 20
125		-	SPECIFIC OFFER OF CO MMERCIAL FINANC ING BY A PROVIDER . 21
	398	+	(B) (1) A PROVIDER SHALL DISCL OSE THE FOLLOWING IN FORMATION TO 24
	399	+	A RECIPIENT WHEN EXT ENDING A SPECIFIC OF FER FOR CLOSED –END FINANCING : 25
126	400
127		-	(2) “RECIPIENT” DOES NOT INCLUDE A P ERSON ACTING AS A 22
128		-	BROKER. 23
	401	+	(I) THE TOTAL AMOUNT OF T HE CLOSED–END FINANCING AND 26
	402	+	THE DISBURSEMENT AMO UNT, IF DIFFERENT FROM TH E FINANCING AMOUNT , 27
	403	+	MINUS ANY FEES DEDUCTED OR WITH HELD AT DISBURSEMENT ; 28
129	404
130		-	(I) ~~(1) “SALES–BASED FINANCING ” MEANS~~ A ~~TRANSACTION : 24~~
	405	+	(II) THE TOTAL REPAYMENT A MOUNT; 29
131	406
132		-	(I) THAT IS REPAID BY A RECIPIENT TO A PROVID ER OVER TIME 25
133		-	AS A PERCENTAGE OF S ALES OR REVENUE , IN WHICH THE PAYME NT AMOUNT MAY 26
134		-	INCREASE OR DECREASE ACCORDING TO THE VOL UME OF SALES MADE OR REVENUE 27
135		-	RECEIVED BY THE RECI PIENT; AND 28
136		-
137		-	(II) THE PROCEEDS OF WHICH THE RECIPIENT DOES N OT 29
138		-	INTEND TO USE PRIMAR ILY FOR PERSONAL , FAMILY, OR HOUSEHOLD PURPOSE S. 30
139		-	4 SENATE BILL 509
	407	+	(III) THE FINANCE CHARGE ; 30
	408	+	10 SENATE BILL 509
140	409
141	410
142		-	(2) “SALES–BASED FINANCING ” INCLUDES A TRANSACTI ON 1
143		-	CONTAINING A TRUE –UP MECHANISM UNDER W HICH THE FINANCING I S REPAID AS 2
144		-	A FIXED PAYMENT BUT PROVIDES FOR A RECON CILIATION PROCESS TH AT ADJUSTS 3
145		-	THE PAYMENT TO AN AM OUNT THAT IS A PERCE NTAGE OF SALES OR RE VENUE. 4
	411	+	(IV) THE ANNUAL PERCENTAGE RATE OF THE CLOSED –END 1
	412	+	FINANCING, USING THE WORDS “ANNUAL PERCENTAGE RA TE” OR THE 2
	413	+	ABBREVIATION “APR”; 3
146	414
147		-	(J) “SPECIFIC OFFER ” MEANS THE TERMS OF C OMMERCIAL FINANCING 5
148		-	THAT ARE QUOTED TO A RECIPIENT, BASED ON INFORMATION OBTAINED FROM OR 6
149		-	ABOUT THE RECIPIENT , WHICH IF ACCEPTED BY THE RECIPIENT ARE BI NDING ON A 7
150		-	PROVIDER, AS APPLICABLE, SUBJECT TO REQUIREME NTS STATED IN THE TERMS OF 8
151		-	THE COMMERCIAL FINAN CING. 9
	415	+	(V) THE TERM OF THE FINANCIN G; 4
152	416
153		-	12–1202. 10
	417	+	(VI) SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION , THE 5
	418	+	PROJECTED PERIODIC P AYMENT AMOUNTS ; 6
154	419
155		-	THIS SUBTITLE DOES NO T APPLY TO: 11
	420	+	(VII) A DESCRIPTION OF ANY O THER POTENTIAL FEES AND 7
	421	+	CHARGES NOT INCLUDED IN THE FINANCE CHARG E, INCLUDING DRAW FEES , LATE 8
	422	+	PAYMENT FEES , AND RETURNED PAYMENT FEES; AND 9
156	423
157		-	(1) ~~(I)~~ A ~~FEDERAL OR STATE BANK,~~ ~~CREDIT UNION , OR SAVINGS 12~~
158		-	~~ASSOCIATION;~~ OR 13
	424	+	(VIII) IF APPLICABLE , A DESCRIPTION OF COL LATERAL 10
	425	+	REQUIREMENTS OR SECU RITY INTERESTS. 11
159	426
160		-	(II) A ~~SUBSIDIARY OR AFFILI ATE OF AN ORGANIZATI ON LISTED 14~~
161		-	~~IN ITEM (I) OF THIS ITEM; 15~~
	427	+	(2) (I) FOR PAYMENT AMOUNTS T HAT ARE FIXED , A PROVIDER 12
	428	+	SHALL DISCLOSE : 13
162	429
163		-	(2) A PERSON ACTING AS A T ECHNOLOGY SERVICES P ROVIDER TO AN 16
164		-	ENTITY EXEMPT UNDER THIS SECTION FOR USE AS PART OF THE ENTIT Y’S 17
165		-	COMMERCIAL FINANCING PROGRAM IF THE PERSO N DOES NOT HAVE AN I NTEREST, 18
166		-	ARRANGEMENT , OR AGREEMENT TO PURC HASE ANY INTEREST IN THE COMMERCIAL 19
167		-	FINANCING EXTENDED B Y THE ENTITY IN CONN ECTION WITH THE COMM ERCIAL 20
168		-	FINANCING PROGRAM ; 21
	430	+	1. THE PAYMENT AMOUNTS A ND FREQUENCY ; AND 14
169	431
170		-	(3) A LENDER REGULATED UND ER THE FEDERAL FARM CREDIT ACT; 22
	432	+	2. IF THE PAYMENT FREQUENCY IS OTHER THAN 15
	433	+	MONTHLY, THE AMOUNT OF THE AV ERAGE PROJECTED PAYM ENTS PER MONTH . 16
171	434
172		-	(4) A ~~COMMERCIAL FINANCING TRANSACTION SECURED BY REAL 23~~
173		-	~~PROPERTY; 24~~
	435	+	(II) FOR PAYMENT AMOUNTS T HAT ARE VARIABLE , A PROVIDER 17
	436	+	SHALL DISCLOSE : 18
174	437
175		-	~~(5)~~ A ~~LEASE AS DEFINED IN ARTICLE 2A~~ OF THE ~~UNIFORM 25~~
176		-	~~COMMERCIAL CODE~~; 26
	438	+	1. THE PAYMENT SCHEDULE OR A DESCRIPTION OF THE 19
	439	+	METHOD USED TO CALCU LATE THE AMOUNTS AND FREQUENC Y OF PAYMENTS ; AND 20
177	440
178		-	(6) A PROVIDER OR OTHER PE RSON WHO MAKES NOT M ORE THAN 27
179		-	FIVE COMMERCIAL FINA NCING TRANSACTIONS I N THE STATE IN A 12–MONTH 28
180		-	PERIOD; 29
	441	+	2. THE AMOUNT OF THE AVE RAGE PROJECTED 21
	442	+	PAYMENTS PER MONTH . 22
181	443
182		-	(7) ~~A COMMERCIAL FINANCING TRANSACTION MORE THA N 30~~
183		-	~~$2,500,000; 31~~
	444	+	(3) THE ANNUAL PERCENTAGE RATE REQUIRED TO BE DISCLOSED 23
	445	+	UNDER PARAGRAPH (1)(IV) OF THIS SUBSECTION S HALL BE: 24
184	446
185		-	(8) A COMMERCIAL FINANCING TRANSACTION : 32 SENATE BILL 509 5
	447	+	(I) EXPRESSED AS A YEARLY RATE, INCLUSIVE OF ANY FEE S 25
	448	+	AND FINANCE CHARGES THAT CANNOT BE AVOID ED BY A RECIPIENT ; AND 26
	449	+
	450	+	(II) CALCULATED IN ACCORDA NCE WITH THE FEDERAL TRUTH 27
	451	+	IN LENDING ACT AND REGULATION Z, 12 C.F.R. § 1026.22, REGARDLESS OF 28
	452	+	WHETHER FEDERAL LAW OR REGULATION WOULD REQUIRE THE CALCULAT ION. 29
	453	+	SENATE BILL 509 11
	454	+
	455	+
	456	+	(C) (1) IF A RECIPIENT PAYS O FF OR REFINANCES THE CLOSED–END 1
	457	+	FINANCING BEFORE THE END OF THE SCHEDULED REPAYMENT PERIOD , A 2
	458	+	PROVIDER SHALL DISCL OSE WHETHER THE RECI PIENT WOULD BE REQUI RED TO 3
	459	+	PAY: 4
	460	+
	461	+	(I) ANY FINANCE CHARGES O THER THAN THE INTEREST 5
	462	+	ACCRUED SINCE THE RE CIPIENT’S LAST PAYMENT ; AND 6
	463	+
	464	+	(II) ANY ADDITIONAL FEES N OT INCLUDED IN THE F INANCE 7
	465	+	CHARGE. 8
	466	+
	467	+	(2) IF A RECIPIENT WOULD BE REQUIRED TO PAY A DDITIONAL 9
	468	+	FINANCE CHARGES OTHE R THAN THE INTEREST ACCRUED SINCE THE RE CIPIENT’S 10
	469	+	LAST PAYMENT , A PROVIDER SHALL DIS CLOSE THE PERCENTAGE OF ANY UNPAID 11
	470	+	PORTION OF THE FINAN CE CHARGE AND MAXIMU M DOLLAR AMOUNT THE 12
	471	+	RECIPIENT COULD BE R EQUIRED TO PAY . 13
	472	+
	473	+	12–1207. 14
	474	+
	475	+	(A) IN THIS SECTION , “TOTAL REPAYMENT AMOU NT” MEANS THE DRAW 15
	476	+	AMOUNT OF THE O PEN–END FINANCING TRANSA CTION, MINUS ANY FEES DEDUC TED 16
	477	+	OR WITHHELD AT DISBU RSEMENT, PLUS THE FINANCE CHA RGE. 17
	478	+
	479	+	(B) (1) WHEN CALCULATING THE TOTAL REPAYMENT AMOU NT IN 18
	480	+	ACCORDANCE WITH THIS SECTION, A PROVIDER SHALL ASS UME A DRAW AMOUNT 19
	481	+	EQUAL TO THE MAXIMUM AMOUNT OF CREDIT AVAI LABLE TO THE RECIPIE NT IF 20
	482	+	DRAWN AND HELD FOR T HE DURATION OF THE T ERM OR DRAW PERIOD . 21
	483	+
	484	+	(2) WHEN CALCULATING A FI NANCE CHARGE IN ACCO RDANCE WITH 22
	485	+	THIS SECTION, A PROVIDER SHALL ASS UME THE MAXIMUM AMOU NT OF CREDIT 23
	486	+	AVAILABLE TO THE REC IPIENT, IN EACH CASE , IS DRAWN AND HELD FO R THE 24
	487	+	DURATION OF THE TERM OF THE DRAW PERIOD . 25
	488	+
	489	+	(C) (1) A PROVIDER SHALL DISCL OSE THE FOLLOWING IN FORMATION TO 26
	490	+	A RECIPIENT WHEN EXT ENDING A SPECIFIC OF FER FOR OPEN–END FINANCING : 27
	491	+
	492	+	(I) THE MAXIMUM AMOUNT OF CREDIT AVAILABLE TO THE 28
	493	+	RECIPIENT AND THE AM OUNT SCHEDULED TO BE DRAWN BY THE RECIPIE NT AT THE 29
	494	+	TIME THE OFFER IS EX TENDED, IF ANY, MINUS ANY FEES DEDUC TED OR WITHHELD 30
	495	+	AT DISBURSEMENT ; 31
	496	+
	497	+	(II) THE FINANCE CHARGE ; 32
	498	+
	499	+	(III) THE TOTAL REPAYMENT A MOUNT; 33 12 SENATE BILL 509
186	500
187	501
188	502
189		-	(I) IN WHICH THE RECIPIEN T IS: 1
	503	+	(IV) THE ANNUAL PERCENTAGE RA TE OF THE COMMERCIAL 1
	504	+	FINANCING, USING THE WORDS “ANNUAL PERCENTAGE RA TE” OR THE 2
	505	+	ABBREVIATION “APR”; 3
190	506
191		-	~~1. A DEALER~~, OR ~~AN AFFILIATE OF A DEALER, AS 2~~
192		-	~~DEFINED IN § 11–111 OF THE TRANSPORTATION ARTICLE~~; ~~OR 3~~
	507	+	(V) THE TERM OF THE PLAN , IF APPLICABLE, OR THE PERIOD 4
	508	+	OVER WHICH A DRAW IS AMORTIZED; 5
193	509
194		-	2. A RENTAL VEHICLE COMPA NY, OR AN AFFILIATE OF A 4
195		-	RENTAL VEHICLE COMPA NY, AS DEFINED IN § 18–108 OF THE TRANSPORTATION 5
196		-	ARTICLE; AND 6
	510	+	(VI) SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION, THE 6
	511	+	PAYMENT FREQUENCY AN D AMOUNTS; 7
197	512
198		-	(II) MADE UNDER A COMMERCI AL FINANCING AGREEME NT OR 7
199		-	COMMERCIAL OPEN –END CREDIT PLAN OF A T LEAST $50,000, INCLUDING A 8
200		-	COMMERCIAL LOAN MADE IN ACCORDANCE WITH T HE COMMERCIAL FINANC ING 9
201		-	TRANSACTION ; OR 10
	513	+	(VII) A DESCRIPTION OF ANY O THER POTENTIAL FEES AND 8
	514	+	CHARGES NOT INCLUDED IN THE FINANCE CHARG E, INCLUDING DRAW FEES , LATE 9
	515	+	PAYMENT FEES , AND RETURNED PAYMENT FEES; AND 10
202	516
203		-	(9) A COMMERCIAL FINANCING TRANSACTION THAT IS A FACTORING 11
204		-	TRANSACTION , AN ADVANCE , OR A SIMILAR TRANSAC TION OF ACCOUNTS 12
205		-	RECEIVABLE OWED TO A HEALTH CARE PROVIDER BECAUSE OF A PATIENT ’S 13
206		-	PERSONAL INJURY TREA TED BY THE HEALTH CA RE PROVIDER; OR 14
	517	+	(VIII) IF APPLICABLE , A DESCRIPTIO N OF COLLATERAL 11
	518	+	REQUIREMENTS OR SECU RITY INTERESTS. 12
207	519
208		-	(10) A ~~PREMIUM FINANCE AGRE EMENT AS DEFINED IN § 23–101 OF 15~~
209		-	~~THE INSURANCE ARTICLE.~~ 16
	520	+	(2) (I) FOR PAYMENT AMOUNTS T HAT ARE FIXED , A PROVIDER 13
	521	+	SHALL DISCLOSE : 14
210	522
211		-	~~12–1203~~. 17
	523	+	1. THE PAYMENT AMOUNTS A ND FREQUENCY ; AND 15
212	524
213		-	~~(A) EXCEPT AS PROVIDED IN § 12–1207 OF THIS SUBTITLE , FOR PURPOSES 18~~
214		-	OF ~~THIS SUBTITLE,~~ ~~AN ANNUAL PERCENTAGE RATE SHALL BE:~~ 19
	525	+	2. IF THE PAYMENT FREQUE NCY IS OTHER THAN 16
	526	+	MONTHLY, THE AMOUNT OF THE AV ERAGE PROJECTED PAYMENTS PE R MONTH. 17
215	527
216		-	(1) ~~EXPRESSED AS~~ A ~~YEARLY RATE,~~ ~~INCLUDING ALL FEES AND 20~~
217		-	~~FINANCE CHARGES ; AND 21~~
	528	+	(II) FOR PAYMENT AMOUNTS T HAT ARE VARIABLE , A PROVIDER 18
	529	+	SHALL DISCLOSE : 19
218	530
219		-	~~(2) CALCULATED IN ACCORDA NCE WITH~~ THE ~~FEDERAL TRUTH IN 22~~
220		-	~~LENDING ACT.~~ 23
	531	+	1. THE PAYMENT SCHEDULE OR A DESCRIPTION OF THE 20
	532	+	METHOD USED TO CALCU LATE THE AMOUNTS AND FREQUENCY OF PAYMENT S; AND 21
221	533
222		-	(B) IN ADDITION TO THE RE QUIREMENTS OF SUBSEC TION (A)(2) OF THIS 24
223		-	SECTION, AN ANNUAL PERCENTAGE RATE SHALL BE CALCUL ATED BASED ON THE 25
224		-	ESTIMATED TERM OF R EPAYMENT AND THE PRO JECTED PERIODIC PAYM ENT 26
225		-	AMOUNTS OF A COMMERC IAL FINANCING TRANSA CTION, REGARDLESS OF WHETHE R 27
226		-	FEDERAL LAW OR REGUL ATION WOULD REQUIRE AN ANNUAL PERCENTAGE RATE TO 28
227		-	BE CALCULATED FOR A CERTAIN TRANSACTION . 29
	534	+	2. THE AMOUNT OF THE AVE RAGE PROJECTED 22
	535	+	PAYMENTS PER MONTH . 23
228	536
229		-	(C) THIS SECTION MAY NOT BE CONSTRUED TO IMPOSE ANY LIABILITY ON A 30
230		-	PROVIDER THAT CHARGE S AN ANNUAL PERCENTA GE RATE THAT DIFFERS FROM THE 31
231		-	ESTIMATED ANNUAL PER CENTAGE RATE DISCLOS ED BY THE PROVIDER I N 32 6 SENATE BILL 509
	537	+	(3) THE ANNUAL PERCENTAGE RATE REQUIRED TO BE DISCLOSED 24
	538	+	UNDER PARAGRAPH (1)(IV) OF THIS SUBSECTION S HALL BE: 25
	539	+
	540	+	(I) EXPRESSED AS A NOMINA L YEARLY RATE , INCLUSIVE OF 26
	541	+	ANY FEES AND FINANCE CHARGES THAT CANNOT BE AVOIDED BY A RECIPIENT; 27
	542	+
	543	+	(II) CALCULATED IN ACCORDA NCE WITH THE FEDERAL TRUTH 28
	544	+	IN LENDING ACT AND REGULATION Z, 12 C.F.R. § 1026.22; AND 29
	545	+	SENATE BILL 509 13
232	546
233	547
234		-	ACCORDANCE WITH THIS SUBTITLE OR ANY REGU LATION ADOPTED UNDER THIS 1
235		-	SUBTITLE. 2
	548	+	(III) BASED ON THE MAXIMUM AMOUNT OF CREDIT AVA ILABLE 1
	549	+	TO THE RECIPIENT AND THE TERM RESULTING F ROM MAKING THE MINIM UM 2
	550	+	REQUIRED PAYMENTS AS DISCLOSED, REGARDLESS OF WHETHE R FEDERAL LAW OR 3
	551	+	REGULATION WOULD REQ UIRE THE CALCULATION . 4
236	552
237		-	12–1204. 3
	553	+	(D) (1) IF A RECIPIENT PAYS O FF OR REFINANCES THE OPEN–END 5
	554	+	FINANCING BEFORE THE END OF THE SCHEDULED REPAYMENT PERIOD , A 6
	555	+	PROVIDER SHALL DISCL OSE WHETHER THE RECIPI ENT WOULD BE REQUIRE D TO 7
	556	+	PAY: 8
238	557
239		-	(A) ~~(1) IN THIS SECTION~~ THE ~~F OLLOWING WORDS HAVE THE MEANINGS 4~~
240		-	~~INDICATED. 5~~
	558	+	(I) ANY FINANCE CHARGES O THER THAN THE INTERE ST 9
	559	+	ACCRUED SINCE THE RE CIPIENT’S LAST PAYMENT ; AND 10
241	560
242		-	(2) “ESTIMATED TERM OF REP AYMENT” MEANS THE AMOUNT OF 6
243		-	TIME REQUIRED FOR TH E PERIODIC PAYMENTS MADE BY A RECIPIENT IN A 7
244		-	SALES–BASED FINANCING TRAN SACTION TO EQUAL THE TOTAL AMOUN T REQUIRED 8
245		-	TO BE REPAID. 9
	561	+	(II) ANY ADDITIONAL FEES N OT INCLUDED IN THE F INANCE 11
	562	+	CHARGE. 12
246	563
247		-	(3) “TOTAL REPAYMENT AMOUN T” MEANS THE DISBURSEME NT 10
248		-	AMOUNT OF A SALES –BASED FINANCING TRAN SACTION PLUS THE FIN ANCE CHARGE . 11
	564	+	(2) IF A RECIPIENT WOULD BE REQUIRED TO PAY ADDITIONAL 13
	565	+	FINANCE CHARGES OTHE R THAN THE INTEREST ACCRUED SINCE THE RE CIPIENT’S 14
	566	+	LAST PAYMENT , A PROVIDER SHALL DIS CLOSE THE PERCENTAGE OF ANY UNPAID 15
	567	+	PORTION OF THE FINAN CE CHARGE AND MAXIMU M DOLLAR AMOUNT THE 16
	568	+	RECIPIENT COULD BE R EQUIRED TO PAY . 17
249	569
250		-	(B) (1) A PROVIDER SHALL DISCL OSE THE FOLLOWING IN FORMATION TO 12
251		-	A RECIPIENT WHEN EXT ENDING A SPECIFIC OFFER OF SALES –BASED FINANCING : 13
	570	+	12–1208. 18
252	571
253		-	(I) THE TOTAL AMOUNT OF T HE SALES–BASED FINANCING AND 14
254		-	THE DISBURSEMENT AMO UNT, IF DIFFERENT FROM TH E FINANCING AMOUNT , 15
255		-	MINUS ANY FEES DEDUC TED OR WITHHELD AT D ISBURSEMENT ; 16
	572	+	(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 19
	573	+	INDICATED. 20
256	574
257		-	(II) THE FINANCE CHARGE ; 17
	575	+	(2) “FINANCE CHARGE ” INCLUDES A DISCOUNT TAKEN ON THE FACE 21
	576	+	VALUE OF THE ACCOUNT S RECEIVABLE. 22
258	577
259		-	(III) THE ESTIM ATED ANNUAL PERCENTA GE RATE OF THE 18
260		-	SALES–BASED FINANCING , USING THE WORDS “ANNUAL PERCENTAGE RA TE” OR THE 19
261		-	ABBREVIATION “APR”; 20
	578	+	(3) “TOTAL PAYMENT AMOUNT ” MEANS THE PURCHASE A MOUNT OF 23
	579	+	THE FACTORING TRANS ACTION PLUS THE FINA NCE CHARGE. 24
262	580
263		-	(IV) THE TOTAL REPAYMENT A MOUNT; 21
	581	+	(B) A PROVIDER SHALL DISCL OSE THE FOLLOWING IN FORMATION TO A 25
	582	+	RECIPIENT WHEN EXTEN DING A SPECIFIC OFFE R FOR A FACTORING TR ANSACTION: 26
264	583
265		-	(V) THE ESTIMATED TERM OF REPAYMENT ; 22
	584	+	(1) THE AMOUNT OF THE REC EIVABLES PURCHASE PR ICE PAID TO 27
	585	+	THE RECIPIENT AND , IF DIFFEREN T FROM THE PURCHASE PRICE, THE 28
	586	+	DISBURSEMENT AMOUNT AFTER ANY FEES DEDUC TED OR WITHHELD AT 29
	587	+	DISBURSEMENT ; 30
266	588
267		-	(VI) SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION , THE 23
268		-	PROJECTED PERIODIC P AYMENT AMOUNTS ; 24
	589	+	(2) THE TOTAL PAYMENT AMO UNT; 31
269	590
270		-	(VII) A DESCRIPTION OF ANY O THER POTENTIAL FEES AND 25
271		-	CHARGES NOT INCLUDED IN THE FINANCE CHARG E, INCLUDING DRAW FEES , LATE 26
272		-	PAYMENT FEES , AND RETURNED PAYMENT FEES; AND 27
273		-
274		-	(VIII) IF APPLICABLE , A DESCRIPTION OF COLLATERAL 28
275		-	REQUIREMENTS OR SECU RITY INTERESTS. 29
276		-	SENATE BILL 509 7
277		-
278		-
279		-	(2) (I) FOR PAYMENT AMOUNTS T HAT ARE FIXED , A PROVIDER 1
280		-	SHALL DISCLOSE : 2
281		-
282		-	1. THE PAYMENT AMOUNTS A ND FREQUENCY ; AND 3
283		-
284		-	2. IF THE PAYMENT FREQUE NCY IS OTHER THAN 4
285		-	MONTHLY, THE AMOUNT OF THE AV ERAGE PROJECTED PAYMENTS P ER MONTH. 5
286		-
287		-	(II) FOR PAYMENT AMOUNTS T HAT ARE VARIABLE , A PROVIDER 6
288		-	SHALL DISCLOSE : 7
289		-
290		-	1. THE PAYMENT SCHEDULE OR A DESCRIPTION OF THE 8
291		-	METHOD USED TO CALCU LATE THE AMOUNTS AND FREQUENCY OF PAYMENT S; AND 9
292		-
293		-	2. THE AMOUNT OF THE AVE RAGE PROJECTED 10
294		-	PAYMENTS PER MONTH . 11
295		-
296		-	(C) (1) IF A RECIPIENT PAYS O FF OR REFINANCES THE SALES–BASED 12
297		-	FINANCING BEFORE THE END OF THE SCHEDULED REPAYMENT PERIOD , A 13
298		-	PROVIDER SHALL DISCL OSE WHETHER THE RECI PIENT WOULD BE REQUI RED TO 14
299		-	PAY: 15
300		-
301		-	(I) ANY FINANCE CHAR GES OTHER THAN THE I NTEREST 16
302		-	ACCRUED SINCE THE RE CIPIENT’S LAST PAYMENT ; AND 17
303		-
304		-	(II) ANY ADDITIONAL FEES N OT INCLUDED IN THE F INANCE 18
305		-	CHARGE. 19
306		-
307		-	(2) IF A RECIPIENT WOULD BE REQUIRED TO PAY A DDITIONAL 20
308		-	FINANCE CHARGES OTHE R THAN THE INTEREST ACCRUED SINCE THE RECIPIENT’S 21
309		-	LAST PAYMENT , A PROVIDER SHALL DIS CLOSE THE PERCENTAGE OF ANY UNPAID 22
310		-	PORTION OF THE FINAN CE CHARGE AND THE MA XIMUM DOLLAR AMOUNT THE 23
311		-	RECIPIENT COULD BE R EQUIRED TO PAY . 24
312		-
313		-	12–1205. 25
314		-
315		-	(A) (1) A PROVIDER SHALL USE T HE PROJECTED SALES V OLUME OF A 26
316		-	RECIPIENT TO CALCULA TE THE FOLLOWING INF ORMATION RELATED TO A 27
317		-	SALES–BASED FINANCING TRAN SACTION: 28
318		-
319		-	(I) THE ESTIMATED TERM OF REPAYMENT AND THE 29
320		-	PROJECTED PAYMENT AM OUNTS OF A SALES–BASED FINANCING TRAN SACTION; AND 30
321		-	8 SENATE BILL 509
322		-
323		-
324		-	(II) THE ESTIMATED ANNUAL PERCENTAGE RATE OF A 1
325		-	SALES–BASED FINANCING TRAN SACTION. 2
326		-
327		-	(2) THE ESTIMATED ANNUAL PERCENTAGE RATE OF A SALES–BASED 3
328		-	FINANCING TRANSACTIO N SHALL BE CALCULATE D: 4
329		-
330		-	(I) IN ACCORDANCE WITH TH E FEDERAL TRUTH IN LENDING 5
331		-	ACT AND REGULATION Z, 12 C.F.R. § 1026.22; AND 6
332		-
333		-	(II) BASED ON THE ESTIMATE D TERM OF REPAYMENT AND 7
334		-	PROJECTED SALES VOLU ME OF A RECIPIENT . 8
335		-
336		-	(B) (1) A PROVIDER MAY CALCULA TE THE PROJECTED SAL ES VOLUME OF 9
337		-	A RECIPIENT USING EITHE R THE HISTORICAL MET HOD OR THE OPT –IN METHOD. 10
338		-
339		-	(2) (I) A PROVIDER THAT USES T HE HISTORICAL METHOD TO 11
340		-	CALCULATE THE PROJEC TED SALES VOLUME OF A RECIPIENT SHALL US E AN 12
341		-	AVERAGE HISTORICAL V OLUME OF SALES OR RE VENUE. 13
342		-
343		-	(II) A PROVIDER S HALL FIX THE HISTORI CAL TIME PERIOD 14
344		-	USED TO CALCULATE TH E AVERAGE HISTORICAL VOLUME AND USE THE S AME TIME 15
345		-	PERIOD FOR ALL DISCL OSURE PURPOSES FOR A NY SALES–BASED FINANCING 16
346		-	TRANSACTION PRODUCTS OFFERED. 17
347		-
348		-	(III) EXCEPT AS PROVIDED IN SUBPARAGRAPH (IV) OF THIS 18
349		-	PARAGRAPH , THE FIXED HISTORICAL TIME PERIOD: 19
350		-
351		-	1. MAY NOT BE LESS THAN 1 MONTH AND MAY NOT 20
352		-	EXCEED 12 MONTHS; AND 21
353		-
354		-	2. SHALL BE THE TIME PER IOD DIRECTLY BEFORE THE 22
355		-	SPECIFIC OFFER WAS M ADE. 23
356		-
357		-	(IV) A PROVIDER MAY CHOOSE TO USE THE AVERAGE S ALES FOR 24
358		-	THE SAME NUMBER OF M ONTHS AS THE PROVIDE R WOULD HAVE USED UN DER 25
359		-	SUBPARAGRAPH (III) OF THIS PARAGRAPH WI TH THE HIGHEST SALES VOLUME 26
360		-	WITHIN THE PAST 12 MONTHS. 27
361		-
362		-	(3) A PROVIDER MAY USE THE OPT–IN METHOD TO DETERMI NE THE 28
363		-	INFORMATION LISTED U NDER SUBSECTION (A)(1) OF THIS SECTION BY U SING A 29
364		-	PROJECTED SALES VOLU ME THAT THE PROVIDER CHOOSES FOR EACH DIS CLOSURE 30
365		-	IF THE RECIPIENT PAR TICIPATES IN A REVIE W PROCESS ESTABLISHE D BY THE 31
366		-	COMMISSIONER . 32
367		-	SENATE BILL 509 9
368		-
369		-
370		-	(C) A PROVIDER SHALL NOTIF Y THE COMMISSIONER WHICH OF THE TWO 1
371		-	METHODS THE PROVIDER INTEN DS TO USE WHEN CALCU LATING THE ESTIMATED 2
372		-	ANNUAL PERCENTAGE RATE OF EACH SALES–BASED FINANCING TRAN SACTION. 3
373		-
374		-	(D) (1) ON OR BEFORE JANUARY 1 EACH YEAR, A PROVIDER THAT 4
375		-	ELECTS TO USE THE OP T–IN METHOD UNDER SUBS ECTION (B)(3) OF THIS SECTION 5
376		-	SHALL REPORT TO THE COMMISSIONER ON : 6
377		-
378		-	(I) THE ESTIMATED ANNUAL PERCENTAGE RATES GIV EN TO 7
379		-	EACH RECIPIENT ; AND 8
380		-
381		-	(II) THE ACTUAL ANNUAL PER CENTAGE RATES OF EAC H 9
382		-	COMPLETED SALES –BASED FINANCING TRAN SACTION. 10
383		-
384		-	(2) (I) THE REPORT REQUIRED U NDER PARAGRAPH (1) OF THIS 11
385		-	SUBSECTION SHALL CON TAIN ANY INFORMATION THE COMMISSIONER CONSIDER S 12
386		-	NECESSARY TO DETERMI NE WHETHER THE DEVIA TION BETWEEN THE EST IMATED 13
387		-	ANNUAL PERCENTAGE RA TES AND ACTUAL ANNUA L PERCENTAGE RATES O F 14
388		-	COMPLETED SALES –BASED FINANCING TRAN SACTIONS IS REASONABL E. 15
389		-
390		-	(II) THE COMMISSIONER MAY CONS IDER EXTRAORDINARY 16
391		-	CIRCUMSTANCES WHEN D ETERMINING WHETHER T HE PROVIDER ’S DEVIATION 17
392		-	BETWEEN THE ESTIMATE D ANNUAL PERCENTAGE RATE AND ACTUAL ANNU AL 18
393		-	PERCENTAGE RATE OF A SALES–BASED FINANCING TRAN SACTION IS REASONABLE . 19
394		-
395		-	(III) IF THE COMMISSIONER FINDS TH AT THERE WAS AN 20
396		-	UNREASONABLE DEVIATI ON BETWEEN ESTIMATED AND ACTUAL ANNUAL 21
397		-	PERCENTAGE RATES OF SALES–BASED FINANCING TRAN SACTIONS, THE 22
398		-	COMMISSIONER MAY REQU IRE THE PROVIDER TO USE THE HISTORICAL M ETHOD 23
399		-	INSTEAD OF THE OPT –IN METHOD IN DETERMI NING THE PROJECTED S ALES VOLUME 24
400		-	OF THE RECIPIENT . 25
401		-
402		-	12–1206. 26
403		-
404		-	(A) IN THIS SECTION , “TOTAL REPAYMENT AMOU NT” MEANS THE 27
405		-	DISBURSEMENT AMOUNT OF A CLOSED–END FINANCING TRANSA CTION PLUS THE 28
406		-	FINANCE CHARGE . 29
407		-
408		-	(B) (1) A PROVIDER SHALL DISCLOSE THE FOLLOWING INFORM ATION TO 30
409		-	A RECIPIENT WHEN EXT ENDING A SPECIFIC OF FER FOR CLOSED –END FINANCING : 31
410		-
411		-	(I) THE TOTAL AMOUNT OF T HE CLOSED–END FINANCING AND 32
412		-	THE DISBURSEMENT AMO UNT, IF DIFFERENT FROM TH E FINANCING AMOUNT , 33
413		-	MINUS ANY FEES DEDUCTED OR WITHHELD AT DISBURSEMENT ; 34 10 SENATE BILL 509
	591	+	(3) THE FINANCE CHARGE ; 32 14 SENATE BILL 509
414	592
415	593
416	594
417		-	(II) THE TOTAL REPAYMENT A MOUNT; 1
	595	+	(4) THE ANNUAL PERCENTAGE RATE OF THE FACTORIN G 1
	596	+	TRANSACTION , USING THE WORDS “ANNUAL PERC ENTAGE RATE ” OR THE 2
	597	+	ABBREVIATION “APR”, CALCULATED ACCORDING TO THE FEDERAL TRUTH IN 3
	598	+	LENDING ACT AND REGULATION Z, 12 C.F.R. § 1026, APPENDIX J, AS A “SINGLE 4
	599	+	ADVANCE, SINGLE PAYMENT TRANS ACTION”; 5
418	600
419		-	(III) THE FINANCE CHARGE ; 2
	601	+	(5) A DESCRIPTION OF ANY O THER POTENTIAL FEES AND CHARGES 6
	602	+	THAT CAN BE AVOIDED BY THE RECIPIENT ; AND 7
420	603
421		-	(IV) ~~THE ANNUAL PERCENTAGE RATE~~ OF THE ~~CLOSED –END~~ 3
422		-	~~FINANCING~~, ~~USING THE WORDS “ANNUAL~~ ~~PERCENTAGE RA TE”~~ ~~OR THE 4~~
423		-	~~ABBREVIATION “APR”; 5~~
	604	+	(6) A DESCRIPTION OF THE R ECEIVABLES PURCHASED AND, IF 8
	605	+	APPLICABLE, ANY ADDITIONAL COLLA TERAL REQUIREMENTS O R SECURITY 9
	606	+	INTERESTS. 10
424	607
425		-	(V) THE TERM OF THE FINANCING ; 6
	608	+	(C) (1) FOR PURPOSES OF T HIS SUBSECTION , THE ANNUAL PERCENTAGE 11
	609	+	RATE SHALL BE CALCUL ATED ACCORDING TO TH E FEDERAL TRUTH IN LENDING 12
	610	+	ACT AND REGULATION Z, 12 C.F.R. § 1026, APPENDIX J, AS A “SINGLE ADVANCE , 13
	611	+	SINGLE PAYMENT TRANS ACTION”, REGARDLESS OF WHETHE R FEDERAL LAW OR 14
	612	+	REGULATION WOULD REQUIRE AN ANN UAL PERCENTAGE RATE TO BE CALCULATED 15
	613	+	FOR A CERTAIN TRANSA CTION. 16
426	614
427		-	(VI) SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION , THE 7
428		-	PROJECTED PERIODIC P AYMENT AMOUNTS ; 8
	615	+	(2) (I) SUBJECT TO SUBPARAGRA PH (II) OF THIS PARAGRAPH , A 17
	616	+	PROVIDER SHALL USE T HE FOLLOWING INFORMA TION TO CALCULATE TH E 18
	617	+	ESTIMATED ANNUAL PER CENTAGE RATE IN ACCO RDANCE WITH THIS SECTION: 19
429	618
430		-	(VII) A DESCRIPTION OF ANY O THER POTENTIAL FEES AND 9
431		-	CHARGES NOT INCLUDED IN THE FINANCE CHARG E, INCLUDING DRAW FEES , LATE 10
432		-	PAYMENT FEES , AND RETURNED PAYMENT FEE S; AND 11
	619	+	1. THE PURCHASE AMOUNT I S THE FINANCING AMOU NT; 20
433	620
434		-	~~(VIII) IF APPLICABLE , A DESCRIPTION OF COL LATERAL 12~~
435		-	~~REQUIREMENTS OR SECU RITY INTERESTS.~~ 13
	621	+	2. THE PAYMENT AMOUNT IS THE PURCHASE AMOUNT 21
	622	+	MINUS THE FINANCE CH ARGE; AND 22
436	623
437		-	~~(2) (I) FOR PAYMENT AMOUNTS T HAT ARE FIXED , A PROVIDER 14~~
438		-	~~SHALL DISCLOSE : 15~~
	624	+	3. THE TERM OF THE FACTO RING TRANSACTION IS 23
	625	+	DETERMINED BY THE PA YMENT DUE DATE OF TH E RECEIVABLES . 24
439	626
440		-	1. THE PAYMENT AMOUNTS A ND FREQUENCY ; AND 16
	627	+	(II) A PROVIDER MAY ESTIMAT E THE TERM FOR A FAC TORING 25
	628	+	TRANSACTION AS THE A VERAGE PAYMENT PERIO D, USING HISTORICAL DAT A OVER 26
	629	+	A PERIOD NOT TO EXCE ED THE PREVIOUS 12 MONTHS, CONCERNING PAYMENT 27
	630	+	INVOICES PAID BY THE PARTY OWING THE ACCO UNTS RECEIVABLE IN Q UESTION. 28
441	631
442		-	2. IF THE PAYMENT FREQUENCY IS OTHER THAN 17
443		-	MONTHLY, THE AMOUNT OF THE AV ERAGE PROJECTED PAYM ENTS PER MONTH . 18
	632	+	12–1209. 29
444	633
445		-	(II) FOR PAYMENT AMOUNTS T HAT ARE VARIABLE , A PROVIDER 19
446		-	SHALL DISCLOSE : 20
447		-
448		-	1. THE PAYMENT SCHEDULE OR A DESCRIPTION OF THE 21
449		-	METHOD USED TO CALCU LATE THE AM OUNTS AND FREQUENCY OF PAYMENTS ; AND 22
450		-
451		-	2. THE AMOUNT OF THE AVE RAGE PROJECTED 23
452		-	PAYMENTS PER MONTH . 24
453		-
454		-	(3) THE ANNUAL PERCENTAGE RATE REQUIRED TO BE DISCLOSED 25
455		-	UNDER PARAGRAPH (1)(IV) OF THIS SUBSECTION S HALL BE: 26
456		-
457		-	(I) EXPRESSED AS A YEARLY RATE, INCLUSIVE OF ANY FEES 27
458		-	AND FINANCE CHARGES THAT CANNOT BE AVOID ED BY A RECIPIENT ; AND 28
459		-	SENATE BILL 509 11
460		-
461		-
462		-	(II) CALCULATED IN ACCORDA NCE WITH THE FEDERAL TRUTH 1
463		-	IN LENDING ACT AND REGULATION Z, 12 C.F.R. § 1026.22, REGARDLESS OF 2
464		-	WHETHER FEDERAL LAW OR REGULATION WOULD REQUIRE THE C ALCULATION. 3
465		-
466		-	(C) (1) IF A RECIPIENT PAYS O FF OR REFINANCES THE CLOSED–END 4
467		-	FINANCING BEFORE THE END OF THE SCHEDULED REPAYMENT PERIOD , A 5
468		-	PROVIDER SHALL DISCL OSE WHETHER THE RECI PIENT WOULD BE REQUI RED TO 6
469		-	PAY: 7
470		-
471		-	(I) ANY FINANCE CHARGES O THER THAN THE INTE REST 8
472		-	ACCRUED SINCE THE RE CIPIENT’S LAST PAYMENT ; AND 9
473		-
474		-	(II) ANY ADDITIONAL FEES N OT INCLUDED IN THE F INANCE 10
475		-	CHARGE. 11
476		-
477		-	(2) IF A RECIPIENT WOULD BE REQUIRED TO PAY A DDITIONAL 12
478		-	FINANCE CHARGES OTHE R THAN THE INTEREST ACCRUED SINCE THE RE CIPIENT’S 13
479		-	LAST PAYMENT, A PROVIDER SHALL DIS CLOSE THE PERCENTAGE OF ANY UNPAID 14
480		-	PORTION OF THE FINAN CE CHARGE AND MAXIMU M DOLLAR AMOUNT THE 15
481		-	RECIPIENT COULD BE R EQUIRED TO PAY . 16
482		-
483		-	12–1207. 17
484		-
485		-	(A) IN THIS SECTION , “TOTAL REPAYMENT AMOU NT” MEANS THE DRAW 18
486		-	AMOUNT OF THE OPEN –END FINANCING TRANSACTIO N, MINUS ANY FEES DEDUC TED 19
487		-	OR WITHHELD AT DISBU RSEMENT, PLUS THE FINANCE CHA RGE. 20
488		-
489		-	(B) (1) WHEN CALCULATING THE TOTAL REPAYMENT AMOU NT IN 21
490		-	ACCORDANCE WITH THIS SECTION, A PROVIDER SHALL ASS UME A DRAW AMOUNT 22
491		-	EQUAL TO THE MAXIMUM AMOUNT OF CREDIT AVAILABLE TO THE RECIPIENT IF 23
492		-	DRAWN AND HELD FOR T HE DURATION OF THE T ERM OR DRAW PERIOD . 24
493		-
494		-	(2) WHEN CALCULATING A FI NANCE CHARGE IN ACCO RDANCE WITH 25
495		-	THIS SECTION, A PROVIDER SHALL ASS UME THE MAXIMUM AMOU NT OF CREDIT 26
496		-	AVAILABLE TO THE REC IPIENT, IN EACH CASE, IS DRAWN AND HELD FO R THE 27
497		-	DURATION OF THE TERM OF THE DRAW PERIOD . 28
498		-
499		-	(C) (1) A PROVIDER SHALL DISCL OSE THE FOLLOWING IN FORMATION TO 29
500		-	A RECIPIENT WHEN EXT ENDING A SPECIFIC OF FER FOR OPEN–END FINANCING : 30
501		-
502		-	(I) THE MAXIMUM AMOUNT OF CREDIT AVAILABL E TO THE 31
503		-	RECIPIENT AND THE AM OUNT SCHEDULED TO BE DRAWN BY THE RECIPIE NT AT THE 32
504		-	TIME THE OFFER IS EX TENDED, IF ANY, MINUS ANY FEES DEDUC TED OR WITHHELD 33
505		-	AT DISBURSEMENT ; 34 12 SENATE BILL 509
506		-
507		-
508		-
509		-	(II) THE FINANCE CHARGE ; 1
510		-
511		-	(III) THE TOTAL REPAYMENT A MOUNT; 2
512		-
513		-	(IV) THE ANNUAL PERCENTAGE RATE OF T HE COMMERCIAL 3
514		-	FINANCING, USING THE WORDS “ANNUAL PERCENTAGE RA TE” OR THE 4
515		-	ABBREVIATION “APR”; 5
516		-
517		-	(V) THE TERM OF THE PLAN , IF APPLICABLE, OR THE PERIOD 6
518		-	OVER WHICH A DRAW IS AMORTIZED; 7
519		-
520		-	(VI) SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION , THE 8
521		-	PAYMENT FREQUENCY AN D AMOUNTS; 9
522		-
523		-	(VII) A DESCRIPTION OF ANY O THER POTENTIAL FEES AND 10
524		-	CHARGES NOT INCLUDED IN THE FINANCE CHARG E, INCLUDING DRAW FEES , LATE 11
525		-	PAYMENT FEES , AND RETURNED PAYMENT FEES; AND 12
526		-
527		-	(VIII) IF APPLICABLE , A DESCRIPTION OF COL LATERAL 13
528		-	REQUIREMENTS OR SECU RITY INTERESTS. 14
529		-
530		-	(2) (I) FOR PAYMENT AMOUNTS T HAT ARE FIXED , A PROVIDER 15
531		-	SHALL DISCLOSE : 16
532		-
533		-	1. THE PAYMENT AMOUNTS A ND FREQUENCY ; AND 17
534		-
535		-	2. IF THE PAYMENT FREQUE NCY IS OTHER THAN 18
536		-	MONTHLY, THE AMOUNT OF THE AV ERAGE PROJECTED PAYMENTS PER MONTH . 19
537		-
538		-	(II) FOR PAYMENT AMOUNTS T HAT ARE VARIABLE , A PROVIDER 20
539		-	SHALL DISCLOSE : 21
540		-
541		-	1. THE PAYMENT SCHEDULE OR A DESCRIPTION OF THE 22
542		-	METHOD USED TO CALCU LATE THE AMOUNTS AND FREQUENCY OF PAYMENT S; AND 23
543		-
544		-	2. THE AMOUNT OF THE AVE RAGE PROJEC TED 24
545		-	PAYMENTS PER MONTH . 25
546		-
547		-	(3) THE ANNUAL PERCENTAGE RATE REQUIRED TO BE DISCLOSED 26
548		-	UNDER PARAGRAPH (1)(IV) OF THIS SUBSECTION S HALL BE: 27
549		-
550		-	(I) EXPRESSED AS A NOMINA L YEARLY RATE , INCLUSIVE OF 28
551		-	ANY FEES AND FINANCE CHARGES THAT CANNOT BE AVOIDED BY A RECI PIENT; 29
552		-	SENATE BILL 509 13
553		-
554		-
555		-	(II) CALCULATED IN ACCORDA NCE WITH THE FEDERAL TRUTH 1
556		-	IN LENDING ACT AND REGULATION Z, 12 C.F.R. § 1026.22; AND 2
557		-
558		-	(III) BASED ON THE MAXIMUM AMOUNT OF CREDIT AVA ILABLE 3
559		-	TO THE RECIPIENT AND THE TERM RESULTING F ROM MAKING THE MINIM UM 4
560		-	REQUIRED PAYMENTS AS DISCLOSE D, REGARDLESS OF WHETHE R FEDERAL LAW OR 5
561		-	REGULATION WOULD REQ UIRE THE CALCULATION . 6
562		-
563		-	(D) (1) IF A RECIPIENT PAYS O FF OR REFINANCES THE OPEN–END 7
564		-	FINANCING BEFORE THE END OF THE SCHEDULED REPAYMENT PERIOD , A 8
565		-	PROVIDER SHALL DISCL OSE WHETHER THE RECIPIENT WOULD BE REQUIRED TO 9
566		-	PAY: 10
567		-
568		-	(I) ANY FINANCE CHARGES O THER THAN THE INTERE ST 11
569		-	ACCRUED SINCE THE RE CIPIENT’S LAST PAYMENT ; AND 12
570		-
571		-	(II) ANY ADDITIONAL FEES N OT INCLUDED IN THE F INANCE 13
572		-	CHARGE. 14
573		-
574		-	(2) IF A RECIPIENT WOULD BE REQUIRED TO PAY ADDITIONAL 15
575		-	FINANCE CHARGES OTHE R THAN THE INTEREST ACCRUED SINCE THE RE CIPIENT’S 16
576		-	LAST PAYMENT , A PROVIDER SHALL DIS CLOSE THE PERCENTAGE OF ANY UNPAID 17
577		-	PORTION OF THE FINAN CE CHARGE AND MAXIMU M DOLLAR AMOUNT THE 18
578		-	RECIPIENT COULD BE R EQUIRED TO PAY . 19
579		-
580		-	12–1208. 20
581		-
582		-	(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 21
583		-	INDICATED. 22
584		-
585		-	(2) “FINANCE CHARGE ” INCLUDES A DISCOUNT TAKEN ON THE FACE 23
586		-	VALUE OF THE ACCOUNT S RECEIVABLE. 24
587		-
588		-	(3) “TOTAL PAYMENT AMOUNT ” MEANS THE PURCHASE A MOUNT OF 25
589		-	THE FACTORING TRANSA CTION PLUS THE FINANCE CHA RGE. 26
590		-
591		-	(B) A PROVIDER SHALL DISCL OSE THE FOLLOWING IN FORMATION TO A 27
592		-	RECIPIENT WHEN EXTEN DING A SPECIFIC OFFE R FOR A FACTORING TR ANSACTION: 28
593		-
594		-	(1) THE AMOUNT OF THE REC EIVABLES PURCHASE PR ICE PAID TO 29
595		-	THE RECIPIENT AND , IF DIFFERENT FROM THE PURCHASE PRICE , THE 30
596		-	DISBURSEMENT AMOUNT AFTER ANY FEES DEDUC TED OR WITHHELD AT 31
597		-	DISBURSEMENT ; 32
598		-	14 SENATE BILL 509
599		-
600		-
601		-	(2) THE TOTAL PAYMENT AMO UNT; 1
602		-
603		-	(3) THE FINANCE CHARGE ; 2
604		-
605		-	(4) THE ANNUAL PERCENTAGE RATE OF THE FACTORIN G 3
606		-	TRANSACTION , USING THE WORDS “ANNUAL PERCENTAGE RATE” OR THE 4
607		-	ABBREVIATION “APR”, CALCULATED ACCORDING TO THE FEDERAL TRUTH IN 5
608		-	LENDING ACT AND REGULATION Z, 12 C.F.R. § 1026, APPENDIX J, AS A “SINGLE 6
609		-	ADVANCE, SINGLE PAYMENT TRANS ACTION”; 7
610		-
611		-	(5) A DESCRIPTION OF ANY O THER POTENTIAL FEES AND CHARGES 8
612		-	THAT CAN BE AVOIDED BY THE RECIPIENT; AND 9
613		-
614		-	(6) A DESCRIPTION OF THE R ECEIVABLES PURCHASED AND, IF 10
615		-	APPLICABLE, ANY ADDITIONAL COLLA TERAL REQUIREMENTS O R SECURITY 11
616		-	INTERESTS. 12
617		-
618		-	(C) (1) FOR PURPOSES OF THIS SUBSECTION, THE ANNUAL PERCENTAG E 13
619		-	RATE SHALL BE CALCUL ATED ACCORDING TO THE FEDERAL TRUTH IN LENDING 14
620		-	ACT AND REGULATION Z, 12 C.F.R. § 1026, APPENDIX J, AS A “SINGLE ADVANCE , 15
621		-	SINGLE PAYMENT TRANS ACTION”, REGARDLESS OF WHETHE R FEDERAL LAW OR 16
622		-	REGULATION WOULD REQ UIRE AN ANNUAL PERCE NTAGE RATE TO BE CAL CULATED 17
623		-	FOR A CERTAIN TRANSACTIO N. 18
624		-
625		-	(2) (I) SUBJECT TO SUBPARAGRA PH (II) OF THIS PARAGRAPH , A 19
626		-	PROVIDER SHALL USE T HE FOLLOWING INFORMA TION TO CALCULATE TH E 20
627		-	ESTIMATED ANNUAL PER CENTAGE RATE IN ACCO RDANCE WITH THIS SEC TION: 21
628		-
629		-	1. THE PURCHASE AMOUNT I S THE FINANCING AMOUNT ; 22
630		-
631		-	2. THE PAYMENT AMOUNT IS THE PURCHASE AMOUNT 23
632		-	MINUS THE FINANCE CH ARGE; AND 24
633		-
634		-	3. THE TERM OF THE FACTO RING TRANSACTION IS 25
635		-	DETERMINED BY THE PA YMENT DUE DATE OF TH E RECEIVABLES . 26
636		-
637		-	(II) A PROVIDER MAY ESTIMAT E THE TERM FOR A FAC TORING 27
638		-	TRANSACTION AS THE A VERAGE PAYMENT PERIO D, USING HISTORICAL DAT A OVER 28
639		-	A PERIOD NOT TO EXCE ED THE PREVIOUS 12 MONTHS, CONCERNING PAYMENT 29
640		-	INVOICES PAID BY THE PARTY OWING THE ACCO UNTS RECEIVABLE IN Q UESTION. 30
641		-
642		-	12–1209. 31
	634	+	(A) IN THIS SECTION , “TOTAL REPAYMENT AMOU NT” MEANS THE 30
	635	+	DISBURSEMENT AMOUNT OF A COMMERCIAL FINA NCING TRANSACTION PL US THE 31
	636	+	FINANCE CHARGE . 32
643	637		SENATE BILL 509 15
644	638
645	639
646		-	(A) IN THIS SECTION , “TOTAL REPAYM ENT AMOUNT ” MEANS THE 1
647		-	DISBURSEMENT AMOUNT OF A COMMERCIAL FINA NCING TRANSACTION PL US THE 2
648		-	FINANCE CHARGE . 3
	640	+	(B) A PROVIDER MAY EXTEND A SPECIFIC OFFER OF COMMERCIAL 1
	641	+	FINANCING THAT IS NO T AN OPEN–END FINANC ING, A CLOSED–END FINANCING , A 2
	642	+	SALES–BASED FINANCING , OR A FACTORING TRANS ACTION BUT OTHERWISE MEETS 3
	643	+	THE DEFINITION OF CO MMERCIAL FINANCING U NDER THIS SUBTITLE . 4
649	644
650		-	(B) A PROVIDER ~~MAY EXTEND~~ A SPECIFIC OFFER ~~OF COMMERCIAL 4~~
651		-	~~FINANCING THAT IS NO T AN~~ OPEN–END FINANCING , A CLOSED–END FINANCING , A 5
652		-	~~SALES–BASED FINANCING , OR~~ A FACTORING ~~TRANS ACTION~~ BUT OTHERWISE ~~MEETS 6~~
653		-	~~THE DEFINITION OF CO MMERCIAL~~ FINANCING ~~U NDER~~ THIS SUBTITLE ~~. 7~~
	645	+	(C) (1) IF A PROVIDER EXTENDS A SPECIFIC OFFER THA T IS NOT AN 5
	646	+	OPEN–END FINANCING , A CLOSED–END FINANCING, A SALES–BASED FINANCING , OR 6
	647	+	A FACTORING TRANSACT ION BUT OTHERWISE ME ETS THE DEFINITION O F 7
	648	+	COMMERCIAL FINANCING UNDER THIS SUBTITLE , THE PROVIDER SHALL D ISCLOSE: 8
654	649
655		-	(C) (1) IF A PROVIDER EXTENDS A SPECIFIC OFFER THA T IS NOT AN 8
656		-	OPEN–END FINANCING , A CLOSED–END FINANCING , A SALES–BASED FINANCING , OR 9
657		-	A FACTORIN G TRANSACTION BUT OT HERWISE MEETS THE DE FINITION OF 10
658		-	COMMERCIAL FINANCING UNDER THIS SUBTITLE , THE PROVIDER SHALL D ISCLOSE: 11
	650	+	(I) THE TOTAL AMOUNT OF T HE COMMERCIAL FINANC ING 9
	651	+	INCLUDING THE DISBUR SEMENT A MOUNT, IF DIFFERENT FROM TH E FINANCING 10
	652	+	AMOUNT, MINUS ANY FEES DEDUC TED OR WITHHELD AT D ISBURSEMENT ; 11
659	653
660		-	(I) THE TOTAL AMOUNT OF T HE COMMERCIAL FINANC ING 12
661		-	INCLUDING THE DISBUR SEMENT AMOUNT , IF DIFFERENT FROM TH E FINANCING 13
662		-	AMOUNT, MINUS ANY FEES DEDUCTED OR WITHHELD AT DISBURSE MENT; 14
	654	+	(II) THE TOTAL REPAYMENT A MOUNT; 12
663	655
664		-	(II) THE ~~TOTAL REPAYMENT A MOUNT~~; 15
	656	+	(III) THE FINANCE CHARGE ; 13
665	657
666		-	(III) THE FINANCE CHARGE ; 16
	658	+	(IV) THE ANNUAL PERCENTAGE RATE OF THE COMMERCI AL 14
	659	+	FINANCING, USING THE WORDS “ANNUAL PERCENTAGE RATE ” OR THE 15
	660	+	ABBREVIATION “APR”, EXPRESSED AS A YEARL Y RATE, INCLUSIVE OF ANY FEE S 16
	661	+	AND FINANCE CHARGES , AND CALCULATED IN AC CORDANCE WITH THE RE LEVANT 17
	662	+	SECTIONS OF THE FEDE RAL TRUTH IN LENDING ACT, REGULATION Z, 12 C.F.R. § 18
	663	+	1026.22, OR THIS ARTIC LE, REGARDLESS OF WHETHE R FEDERAL LAW , THE 19
	664	+	REGULATION , OR THIS ARTICLE WOUL D REQUIRE THE CALCUL ATION; 20
667	665
668		-	(IV) THE ANNUAL PERCENTAGE RATE OF THE COMMERCI AL 17
669		-	FINANCING, USING THE WORDS “ANNUAL PERCENTAGE RA TE” OR THE 18
670		-	ABBREVIATION “APR”, EXPRESSED AS A YEARLY RATE , INCLUSIVE OF ANY FEE S 19
671		-	AND FINANCE CHARGES , AND CALCULATED IN AC CORDANCE WITH THE RE LEVANT 20
672		-	SECTIONS OF THE FEDE RAL TRUTH IN LENDING ACT, REGULATION Z, 12 C.F.R. § 21
673		-	1026.22, OR THIS ARTICLE , REGARDLESS OF WHETHE R FEDERAL LAW , THE 22
674		-	REGULATIO N, OR THIS ARTICLE WOUL D REQUIRE THE CALCUL ATION; 23
	666	+	(V) THE TERM OF THE COMME RCIAL FINANCING ; 21
675	667
676		-	(V) THE TERM OF THE COMME RCIAL FINANCING ; 24
	668	+	(VI) SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION , THE 22
	669	+	PAYMENT FREQUENCY AN D AMOUNTS; 23
677	670
678		-	(VI) SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION , THE 25
679		-	PAYMENT FREQUENCY AN D AMOUNTS; 26
	671	+	(VII) A DESCRIPTION OF ANY O THER POTENTIAL FEES AND 24
	672	+	CHARGES NOT INCLUDED IN THE FINANCE CHARG E, INCLUDING LATE PAYME NT 25
	673	+	FEES AND RETURNED PA YMENT FEES; AND 26
680	674
681		-	(VII) A DESCRIPTION OF ANY O THER POTENTIAL FEES AND 27
682		-	CHARGES NOT INCLUDED IN THE FINA NCE CHARGE , INCLUDING LATE PAYME NT 28
683		-	FEES AND RETURNED PA YMENT FEES; AND 29
	675	+	(VIII) IF APPLICABLE , A DESCRIPTION OF COL LATERAL 27
	676	+	REQUIREMENTS OR SECU RITY INTERESTS. 28
684	677
685		-	(~~VIII~~) ~~IF APPLICABLE~~ , A ~~DESCRIPTION OF COL LATERAL 30~~
686		-	~~REQUIREMENTS OR SECU RITY INTERESTS. 31~~
	678	+	(2) (I) FOR PAYMENT AMOUNTS THAT ARE FIXED, A PROVIDER 29
	679	+	SHALL DISCLOSE : 30
687	680
688		-	~~(2) (I) FOR~~ PAYMENT AMOUNTS ~~T HAT ARE FIXED ,~~ A ~~PROVIDER 32~~
689		-	~~SHALL DISCLOSE : 33~~ 16 SENATE BILL 509
	681	+	1. THE PAYMENT AMOUNTS A ND FREQUENCY ; AND 31
	682	+	16 SENATE BILL 509
690	683
691	684
	685	+	2. IF THE PAYMENT FREQUE NCY IS OTHER THAN 1
	686	+	MONTHLY, THE AMOUNT OF THE AV ERAGE PROJECTED PAYM ENTS PER MONTH . 2
692	687
693		-	1. THE PAYMENT AMOUNTS A ND FREQUENCY ; AND 1
	688	+	(II) FOR PAYMENT AMOUNTS T HAT ARE VARIABLE, A PROVIDER 3
	689	+	SHALL DISCLOSE : 4
694	690
695		-	2. IF THE PAYMENT ~~FREQUE NCY IS OTHER THAN 2~~
696		-	~~MONTHLY,~~ THE ~~AMOUNT~~ OF ~~THE AV ERAGE PROJECTED PAYM ENTS PER MONTH . 3~~
	691	+	1. THE PAYMENT SCHEDULE OR A DESCRIPTION OF THE 5
	692	+	METHOD USED TO CALCU LATE THE AMOUNTS AND FREQUENCY OF PAYMENT S; AND 6
697	693
698		-	~~(II) FOR PAYMENT AMOUNTS T HAT ARE VARIABLE , A PROVIDER 4~~
699		-	~~SHALL DISCLOSE : 5~~
	694	+	2. THE AMOUNT OF THE AVE RAGE PROJECTED 7
	695	+	PAYMENTS PER MONTH . 8
700	696
701		-	1. THE PAYMENT SCHEDULE OR A DESCRI PTION OF THE 6
702		-	METHOD USED TO CALCU LATE THE AMOUNTS AND FREQUENCY OF PAYMENT S; AND 7
	697	+	(D) (1) IF A RECIPIENT PAYS O FF OR REFINANCES THE COMMER CIAL 9
	698	+	FINANCING BEFORE THE END OF THE SCHEDULED REPAYMENT PERIOD , A 10
	699	+	PROVIDER SHALL DISCL OSE WHETHER THE RECI PIENT WOULD BE REQUI RED TO 11
	700	+	PAY: 12
703	701
704		-	2. THE ~~AMOUNT OF THE AVE RAGE PROJECTED 8~~
705		-	~~PAYMENTS PER MONTH . 9~~
	702	+	(I) ANY FINANCE CHARGES O THER THAN THE INTERE ST 13
	703	+	ACCRUED SINCE THE RE CIPIENT’S LAST PAYMENT ; AND 14
706	704
707		-	(D) (1) IF A RECIPIENT PAYS O FF OR REFINANCES THE COMMERCIAL 10
708		-	FINANCING BEFORE THE END OF THE SCHEDULED REPAYM ENT PERIOD , A 11
709		-	PROVIDER SHALL DISCL OSE WHETHER THE RECI PIENT WOULD BE REQUI RED TO 12
710		-	PAY: 13
	705	+	(II) ANY ADDITIONAL FEES N OT INCLUDED IN THE F INANCE 15
	706	+	CHARGE. 16
711	707
712		-	(I) ANY FINANCE CHARGES O THER THAN THE INTERE ST 14
713		-	ACCRUED SINCE THE RE CIPIENT’S LAST PAYMENT ; AND 15
	708	+	(2) IF A RECIPIENT WOULD BE REQUIRED TO PAY A DDITIONAL 17
	709	+	FINANCE CHARGES OTHE R THAN THE INTEREST ACCRUED SINCE THE RE CIPIENT’S 18
	710	+	LAST PAYMENT , A PROVIDER SHALL DIS CLOSE THE PERCENTAGE OF ANY UNPAID 19
	711	+	PORTION OF THE FINAN CE CHARGE AND MAXIMU M DOLLAR AMOUNT THE 20
	712	+	RECIPIENT COULD BE R EQUIRED TO PAY . 21
714	713
715		-	(II) ANY ADDITIONAL FEES N OT INCLUDED IN THE F INANCE 16
716		-	CHARGE. 17
	714	+	12–1210. 22
717	715
718		-	(2) IF A RECIPIENT WOULD BE REQUIRED TO PAY A DDITIONAL 18
719		-	FINANCE CHARGES OTHE R THAN THE INTEREST ACCRUED SINCE THE RE CIPIENT’S 19
720		-	LAST PAYMENT , A PROVIDER SHALL DIS CLOSE THE PERCENTAGE OF ANY UNPAID 20
721		-	PORTION OF THE FINAN CE CHARGE AND MAXIMU M DOLLAR AMOUNT THE 21
722		-	RECIPIENT COULD BE R EQUIRED TO PAY . 22
	716	+	(A) A PROVIDER MAY REQUIRE A RECIPIENT TO PAY O FF THE BALANCE OF 23
	717	+	AN EXISTING COMMERCI AL FINANCING TRANSAC TION FROM THE SAME P ROVIDER 24
	718	+	AS A CONDITION OF OBTAINI NG A NEW OR RENEWAL COMMERCIAL FINANCING 25
	719	+	TRANSACTION . 26
723	720
724		-	12–1210. 23
	721	+	(B) IF A PROVIDER REQUIRE S A RECIPIENT TO PAY OFF A COMMERCIAL 27
	722	+	FINANCING TRANSACTIO N BEFORE OBTAINING A NEW OR RENEWAL COMME RCIAL 28
	723	+	FINANCING TRANSACTIO N, THE PROVIDER SHALL D ISCLOSE: 29
725	724
726		-	(A) A PROVIDER MAY REQUIRE A RECIPIENT TO PAY O FF THE BALANCE OF 24
727		-	AN EXISTING COMMERCI AL FINANCING TRANSAC TION FROM THE SAME P ROVIDER 25
728		-	AS A CONDITION OF OB TAINING A NEW OR REN EWAL COMMERCIAL FINANCING 26
729		-	TRANSACTION . 27
730		-
731		-	(B) IF A PROVIDER REQUIRE S A RECIPIENT TO PAY OFF A COMMERCIAL 28
732		-	FINANCING TRANSACTIO N BEFORE OBTAINING A NEW OR RENEWAL COMME RCIAL 29
733		-	FINANCING TRANSACTIO N, THE PROVIDER SHALL D ISCLOSE: 30
	725	+	(1) THE AMOUNT OF THE NEW OR RENEWAL COMMERCIA L FINANCING 30
	726	+	THAT WILL BE USED TO PAY OFF THE PORTION OF THE EXISTING COMM ERCIAL 31
	727	+	FINANCING THAT CONSI STS OF ANY REQUIRED PREPAYMENT CHARGES ; AND 32
734	728		SENATE BILL 509 17
735	729
736	730
737		-	(1) THE AMOUNT OF THE NEW OR RENEWAL COMMERCIA L FINANCING 1
738		-	THAT WILL BE USED TO PAY OFF THE PORTION OF THE EXISTING COMM ERCIAL 2
739		-	FINANCING THAT CONSI STS OF ANY REQUIRED PREPAYMENT CHARGES ; AND 3
	731	+	(2) ANY UNPAID INTEREST T HAT WAS NOT FORGIVEN AT THE TIME 1
	732	+	THE NEW OR RENEWAL C OMMERCIAL FINANCING WAS ENTERED INTO . 2
740	733
741		-	(2) ANY UNPAID INTEREST T HAT WAS NOT FORGIVEN AT THE TIME 4
742		-	THE NEW OR RENEWAL C OMMERCIAL FINANCING WAS ENTERED INTO. 5
	734	+	(C) (1) FOR FINANCING FOR WHI CH THE TOTAL REPAYME NT AMOUNT IS 3
	735	+	CALCULATED AS A FIXE D AMOUNT, THE PREPAYMENT CHARG E IS EQUAL TO THE 4
	736	+	ORIGINAL FINANCE CHA RGE MULTIPLIED BY TH E AMOUNT OF THE NEW OR 5
	737	+	RENEWAL COMMERCIAL FINA NCING USED TO PAY OF F THE EXISTING COMME RCIAL 6
	738	+	FINANCING TRANSACTIO N AS A PERCENTAGE OF THE TOTAL REPAYMENT AMOUNT, 7
	739	+	MINUS ANY PORTION OF THE TOTAL REPAYMENT AMOUNT FORGIVEN BY T HE 8
	740	+	PROVIDER AT THE TIME OF PREPAYMENT . 9
743	741
744		-	(C) (1) FOR FINANCING FOR WHI CH THE TOTAL REPAYME NT AMOUNT IS 6
745		-	CALCULATED AS A FIXE D AMOUNT, THE PREPAYMENT CHARG E IS EQUAL TO THE 7
746		-	ORIGINAL FINANCE CHA RGE MULTIPLIED BY TH E AMOUNT OF THE NEW OR 8
747		-	RENEWAL COMMERCIAL F INANCING USED TO PAY OFF THE EXIST ING COMMERCIAL 9
748		-	FINANCING TRANSACTIO N AS A PERCENTAGE OF THE TOTAL REPAYMENT AMOUNT, 10
749		-	MINUS ANY PORTION OF THE TOTAL REPAYMENT AMOUNT FORGIVEN BY T HE 11
750		-	PROVIDER AT THE TIME OF PREPAYMENT . 12
	742	+	(2) IF THE PREPAYM ENT CHARGE IS MORE T HAN ZERO , THE 10
	743	+	PROVIDER SHALL RECOR D THE AMOUNT AS THE ANSWER TO THE FOLLOW ING 11
	744	+	QUESTION: 12
751	745
752		-	~~(2) IF~~ THE ~~PREPAYMENT CHA RGE IS MORE THAN ZER O,~~ ~~THE~~ 13
753		-	~~PROVIDER SHALL RE CORD THE~~ AMOUNT ~~AS T HE ANSWER~~ TO ~~THE FOL LOWING~~ 14
754		-	~~QUESTION:~~ 15
	746	+	“DOES THE NEW OR RENEW AL COMMERCIAL FINANC ING TRANSACTION INCL UDE 13
	747	+	ANY AMOUNT THAT IS U SED TO PAY UNPAID FI NANCE CHARGES OR FEE S, ALSO 14
	748	+	KNOWN AS DOUB LE DIPPING? YES, (ENTER AMOUNT )”. 15
755	749
756		-	“DOES THE NEW OR RENEW AL COMMERCIAL FINANC ING TRANSACTION INCL UDE 16
757		-	ANY AMOUNT THAT IS U SED TO PAY UNPAID FI NANCE CHARGES OR FEE S, ALSO 17
758		-	KNOWN AS DOUBLE DIPP ING? YES, (ENTER AMOUNT )”. 18
	750	+	(D) IF THE DISBURSEMENT A MOUNT OF THE NEW OR RENEWAL 16
	751	+	COMMERCIAL FINANCING TRANSACTION WILL BE REDUCED TO PAY DOWN ANY 17
	752	+	UNPAID PORTION OF TH E OUTSTANDING BALANC E OF THE EXISTING CO MMERCIAL 18
	753	+	FINANCING, THE PROVIDER SHALL D ISCLOSE THE ACTUAL DOL LAR AMOUNT BY 19
	754	+	WHICH THE DISBURSEME NT AMOUNT WILL BE RE DUCED. 20
759	755
760		-	(D) IF THE DISB URSEMENT AMOUNT OF T HE NEW OR RENEWAL 19
761		-	COMMERCIAL FINANCING TRANSACTION WILL BE REDUCED TO PAY DOWN ANY 20
762		-	UNPAID PORTION OF TH E OUTSTANDING BALANC E OF THE EXISTING CO MMERCIAL 21
763		-	FINANCING, THE PROVIDER SHALL D ISCLOSE THE ACTUAL D OLLAR AMOUNT BY 22
764		-	WHICH THE DISBURS EMENT AMOUNT WILL BE REDUCED. 23
	756	+	12–1211. 21
765	757
766		-	12–1211. 24
	758	+	A RECIPIENT SHALL SIGN , MANUALLY OR ELECTRON ICALLY, EACH 22
	759	+	APPLICABLE DISCLOSUR E REQUIRED UNDER THI S SUBTITLE BEFORE A PROVIDER 23
	760	+	MAY ALLOW THE RECIPI ENT TO PROCEED WITH THE COMMERCIAL FINANCING 24
	761	+	APPLICATION. 25
767	762
768		-	A RECIPIENT SHALL SIGN , MANUALLY OR ELECTRON ICALLY, EACH 25
769		-	APPLICABLE DISCLOSUR E REQUIRED UNDER THI S SUBTITLE BEFORE A PROVIDER 26
770		-	MAY ALLOW THE RECIPI ENT TO PROCEED WITH THE COMMERCIAL FINAN CING 27
771		-	APPLICATION. 28
	763	+	12–1212. 26
772	764
773		-	12–1212. 29
	765	+	(A) (1) NOTHING IN THIS SUBTI TLE MAY BE CONSTRUED TO PREVENT A 27
	766	+	PROVIDER FROM DISCLO SING ADDITIONAL INFO RMATION TO A RECIPIE NT 28
	767	+	REGARDING A COMMERCI AL FINANCING TRANSAC TION. 29
774	768
775		-	(A) (1) NOTHING IN THIS SUBTI TLE MAY BE CONSTRUED TO PREVENT A 30
776		-	PROVIDER FROM DISCLO SING ADDITIONAL INFO RMATION TO A RECIPIE NT 31
777		-	REGARDING A COMMERCI AL FINANCING TRANSAC TION. 32
778		-	18 SENATE BILL 509
	769	+	(2) IF A PROVIDER PROVIDE S AN ADDITIONAL DISC LOSURE TO A 30
	770	+	RECIPIENT OTHER THAN WHAT IS REQUIRED BY THIS SUBTITLE, THE ADDITIONAL 31
	771	+	DISCLOSURE IS NOT CO NSIDERED A REQUIRED DISCLOSURE UNDER THI S SUBTITLE. 32
	772	+
	773	+	(B) (1) IF ADDITIONAL METRICS OF FINANCING COSTS A RE DISCLOSED 33
	774	+	OR USED IN THE APPLICATION PROCESS FOR COMMERCIAL FINAN CING, THE 34 18 SENATE BILL 509
779	775
780	776
781		-	(2) IF A PROVIDER PROVIDE S AN ADDITIONAL DISC LOSURE TO A 1
782		-	RECIPIENT OTHER THAN WHAT IS REQUIRED BY THIS SUBTITLE, THE ADDITIONAL 2
783		-	DISCLOSURE IS NOT CO NSIDERED A REQUIRED DISCLOSURE UNDER THI S SUBTITLE. 3
	777	+	ADDITIONAL METRICS M AY NOT BE PRESENTED AS A RATE IF THEY AR E NOT THE 1
	778	+	ANNUAL INTEREST RATE OR THE ANNUAL PERCEN TAGE RATE. 2
784	779
785		-	(B) (1) IF ADDITIONAL METRICS OF FINANCING COSTS A RE DISCLOSED 4
786		-	OR USED IN THE APPLI CATION PROCESS FOR C OMMERCIAL FINANCING , THE 5
787		-	ADDITIONAL METRICS M AY NOT BE PRESENTED AS A RATE IF THEY AR E NOT THE 6
788		-	ANNUAL INTEREST RATE OR THE ANNUAL PERCEN TAGE RATE. 7
	780	+	(2) THE TERM “INTEREST”, WHEN USED TO DESCRIB E A PERCENTAGE 3
	781	+	RATE, MAY BE USED ONL Y TO DESCRIBE ANNUAL PERCENTAGE RATES , INCLUDING 4
	782	+	THE ANNUAL INTEREST RATE. 5
789	783
790		-	(2) THE TERM “INTEREST”, WHEN USED TO DESCRIB E A PERCENTAGE 8
791		-	RATE, MAY BE USED ONLY TO DESCRIBE ANNUAL PERC ENTAGE RATES , INCLUDING 9
792		-	THE ANNUAL INTEREST R ATE. 10
	784	+	(C) IF A PROVIDER STATES A RATE OF FINANCE CH ARGE OR A FINANCING 6
	785	+	AMOUNT TO A RECIPIEN T DURING THE APPLICA TION PROCESS FOR COM MERCIAL 7
	786	+	FINANCING, THE PROVIDER SHALL A LSO STATE THE R ATE AS AN “ANNUAL 8
	787	+	PERCENTAGE RATE ”, USING THAT TERM OR T HE ABBREVIATION “APR”. 9
793	788
794		-	(C) IF A PROVIDER STATES A RATE OF FINANCE CH ARGE OR A FINANCING 11
795		-	AMOUNT TO A RECIPIEN T DURING THE APPLICA TION PROCESS FOR COM MERCIAL 12
796		-	FINANCING, THE PROVIDER SHALL A LSO STATE THE RATE A S AN “ANNUAL 13
797		-	PERCENTAGE RATE ”, USING THAT TER M OR THE ABBREVIATIO N “APR”. 14
	789	+	12–1213. 10
798	790
799		-	12–1213. 15
	791	+	(A) TO CARRY OUT THIS SUB TITLE, THE COMMISSIONER SHALL AD OPT 11
	792	+	REGULATIONS SUBSTANT IALLY THE SAME AS RE GULATIONS ADOPTED BY THE NEW 12
	793	+	YORK STATE DEPARTMENT OF FINANCIAL SERVICES REGARDING CO MMERCIAL 13
	794	+	FINANCING. 14
800	795
801		-	(A) ~~TO CARRY OUT THIS SUB TITLE,~~ THE COMMISSIONER SHALL ~~AD OPT 16~~
802		-	~~REGULATIONS SUBSTANT IALLY THE SAME AS RE GULATIONS ADOPTED BY THE NEW 17~~
803		-	~~YORK STATE DEPARTMENT OF FINANCIAL SERVICES REGARDING CO MMERCIAL 18~~
804		-	~~FINANCING~~. 19
	796	+	(B) THE COMMISSIONER SHALL AP PROVE THE USE OF COM MERCIAL 15
	797	+	FINANCING DISCLOSURE FORMS APPROVED FOR U SE IN OTHER STATES W ITH 16
	798	+	COMMERCIAL FINANCING DISCLOSURE REQUIREME NTS THAT ARE SUBSTAN TIALLY 17
	799	+	SIMILAR TO OR EXCEED THE REQUIREMENTS OF TH IS SUBTITLE. 18
805	800
806		-	(B) THE COMMISSIONER SHALL AP PROVE THE USE OF COM MERCIAL 20
807		-	FINANCING DISCLOSURE FORMS APPROVED FOR U SE IN OTHER STATES W ITH 21
808		-	COMMERCIAL FINANCING DISCLOSURE REQUIREME NTS THAT ARE SUBSTAN TIALLY 22
809		-	SIMILAR TO OR EXCEED THE REQUIREMENTS OF THIS SUBTITLE. 23
	801	+	12–1214. 19
810	802
811		-	12–1214. 24
	803	+	(A) (1) THE COMMISSIONER SHALL IM POSE A CIVIL PENALTY NOT 20
	804	+	EXCEEDING: 21
812	805
813		-	(A) (1) THE COMMISSIONER SHALL IM POSE A CIVIL PENALTY NOT 25
814		-	EXCEEDING: 26
	806	+	(I) $2,000 FOR EACH VIOLATION O F THIS SUBTITLE; AND 22
815	807
816		-	(I) $2,000 FOR EACH ~~VIOLATION O F~~ THIS ~~SUBTITLE; AND 27~~
	808	+	(II) $10,000 FOR EACH WILLFUL VIO LATION OF THIS SUBTI TLE. 23
817	809
818		-	(II) $10,000 FOR EACH WILLFUL VIO LATION OF THIS SUBTI TLE. 28
	810	+	(2) THE COMMISSIONER MAY ORDER ADDITIONAL RELIEF, 24
	811	+	INCLUDING RESTITUTIO N OR A PERMANENT OR PRELIMINARY INJUNCTI ON ON 25
	812	+	BEHALF OF A RECIPIEN T AFFECTED BY A VIOL ATION OF THIS SUBTIT LE. 26
819	813
820		-	(2) ~~THE COMMISSIONER MAY ORDE R ADDITIONAL RELIEF , 29~~
821		-	~~INCLUDING RESTITUTIO N OR~~ A ~~PERMANENT OR PRELIMINARY INJUNCTI ON ON 30~~
822		-	~~BEHALF~~ OF ~~A RECIPIEN T AFFECTED BY A VIOL ATION OF THIS SUBTIT LE. 31~~
823		-	~~SENATE BILL 509~~ 19
	814	+	(B) IF A COMPLAINT ABOUT A VIOLATION OF THIS SUBTITLE IS FILED WI TH 27
	815	+	THE COMMISSIONER , THE COMMISSIONER MAY INVESTI GATE THE COMPLAINT A ND 28
	816	+	USE ANY OF THE INVES TIGATIVE AND ENFORCE MENT POWERS PROVIDED UNDER 29
	817	+	TITLE 2, SUBTITLE 1 OF THIS ARTICLE. 30
824	818
825		-
826		-	(B) IF A COMPLAINT ABOUT A VIOLATION OF THIS SUBTITLE IS FILED WI TH 1
827		-	THE COMMISSIONER , THE COMMISSIONER MAY INVE STIGATE THE COMPLAIN T AND 2
828		-	USE ANY OF THE INVESTIGATIVE AND ENFORCEMENT POWE RS PROVIDED UNDER 3
829		-	TITLE 2, SUBTITLE 1 OF THIS ARTICLE. 4
830		-
831		-	SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 5
832		-	October 1, 2024. 6
	819	+	SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 31
	820	+	October 1, 2024. 32 SENATE BILL 509 19
833	821
834	822
835	823
836	824
837		-
838		-
839		-	Approved:
840		-	________________________________________________________________________________
841		-	Governor.
842		-	________________________________________________________________________________
843		-	President of the Senate.
844		-	________________________________________________________________________________
845		-	Speaker of the House of Delegates.