| 1 | 1 | | FIRSTREGULARSESSION |
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| 2 | 2 | | HOUSEBILLNO.1325 |
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| 3 | 3 | | 103RDGENERALASSEMBLY |
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| 4 | 4 | | INTRODUCEDBYREPRESENTATIVEFOGLE. |
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| 5 | 5 | | 1451H.01I JOSEPHENGLER,ChiefClerk |
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| 6 | 6 | | ANACT |
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| 7 | 7 | | Torepealsections367.515,408.500,408.505,and408.510,RSMo,andtoenactinlieu |
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| 8 | 8 | | thereofsixnewsectionsrelatingtosmallloans,withpenaltyprovisionsanda |
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| 9 | 9 | | referendumclause. |
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| 10 | 10 | | BeitenactedbytheGeneralAssemblyofthestateofMissouri,asfollows: |
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| 11 | 11 | | SectionA.Sections367.515,408.500,408.505,and408.510,RSMo,arerepealed |
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| 12 | 12 | | 2andsixnewsectionsenactedinlieuthereof,tobeknownassections367.105,367.515, |
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| 13 | 13 | | 3408.101,408.500,408.505,and408.510,toreadasfollows: |
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| 14 | 14 | | 367.105.Anypersonmakingorofferingaconsumercreditloanshallcontract |
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| 15 | 15 | | 2forandreceiveinterestandfeesinaccordancewithsections408.100,408.101,408.140, |
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| 16 | 16 | | 3and408.170,andsuchloanshallbesubjecttoallprovisionsofsections408.100,408.101, |
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| 17 | 17 | | 4408.140,and408.170. |
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| 18 | 18 | | 367.515.Atitlelendershallcontractforandreceivesimpleinterestandfeesin |
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| 19 | 19 | | 2accordancewithsections408.100, 408.101,and408.140, andsuchinterestandfeesshallbe |
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| 20 | 20 | | 3subjecttoallprovisionsofsections408.100,408.101,and408.140. |
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| 21 | 21 | | 408.101.1.Onanyloansubjecttothissection,anyperson,firm,orcorporation |
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| 22 | 22 | | 2maycharge,contractfor,andreceiveinterestontheunpaidprincipalbalanceatrates |
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| 23 | 23 | | 3agreedtobytheparties,providedthatthecombinedinterest,fees,andfinancecharges |
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| 24 | 24 | | 4shallnotexceedanannualpercentagerateofthirty-sixpercent. |
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| 25 | 25 | | 5 2.Noperson,firm,orcorporationshalluseanydeviceorsubterfugeto |
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| 26 | 26 | | 6intentionallyevadetherequirementsofthischapterto: |
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| 27 | 27 | | 7 (1)Offer,make,assistaborrowerinobtaining,orbrokeraloanatanannual |
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| 28 | 28 | | 8percentagerateprohibitedbythissection; |
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| 29 | 29 | | EXPLANATION—Matterenclosedinbold-facedbrackets[thus] intheabovebillisnotenactedandis |
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| 30 | 30 | | intendedtobeomittedfromthelaw.Matterinbold-facetypeintheabovebillisproposedlanguage. 9 (2)Makealoandisguisedasapersonalpropertysaleandleasebacktransaction; |
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| 31 | 31 | | 10 (3)Disguiseloanproceedsascashrebatesforthepretextualinstallmentsaleof |
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| 32 | 32 | | 11goodsorservices; |
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| 33 | 33 | | 12 (4)Make,assistaborrowerinobtaining,orbrokeranofferofcredit,inwholeor |
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| 34 | 34 | | 13inpart,fromathirdpartyorwhileactingasanagentforathirdparty,regardlessof |
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| 35 | 35 | | 14whetherthethirdpartyisexemptfromlicensingoriftheapproval,acceptance,or |
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| 36 | 36 | | 15ratificationbythethirdpartyisnecessarytocreatealegalobligationforthethird |
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| 37 | 37 | | 16party;or |
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| 38 | 38 | | 17 (5)Charge,ifauthorizedunderanyapplicablesectionofMissourilaw,any |
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| 39 | 39 | | 18applicationfeeforprovidingcreditoranyfeeforparticipationinacreditplanwithout |
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| 40 | 40 | | 19includingthefeeinthecalculationoftheannualpercentageraterequiredunderthis |
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| 41 | 41 | | 20section. |
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| 42 | 42 | | 408.500.1.Lenders,otherthanbanks,trustcompanies,creditunions,savingsbanks |
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| 43 | 43 | | 2andsavingsandloancompanies,inthebusinessofmakingunsecuredloansoffivehundred |
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| 44 | 44 | | 3dollarsorlessshallobtainalicensefromthedirectorofthedivisionoffinance.Anannual |
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| 45 | 45 | | 4licensefeeofsixhundreddollarsperlocationshallberequired.Thelicenseyearshall |
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| 46 | 46 | | 5commenceonJanuaryfirsteachyearandthelicensefeemaybeproratedforexpiredmonths. |
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| 47 | 47 | | 6Thedirectormayestablishabienniallicensingarrangementbutinnocaseshallthefeesbe |
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| 48 | 48 | | 7payableformorethanoneyearatatime.Theprovisionsofthissectionshallnotapplyto |
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| 49 | 49 | | 8pawnbrokerloans,consumercreditloansasauthorizedunderchapter367,nortoacheck |
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| 50 | 50 | | 9acceptedanddepositedorcashedbythepayeebusinessonthesameorthefollowingbusiness |
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| 51 | 51 | | 10day.ThedisclosuresrequiredbythefederalTruthinLendingAct,15U.S.C.Section1601et |
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| 52 | 52 | | 11seq.,andregulationZshallbeprovidedonanyloan,renewalorextensionmadepursuantto |
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| 53 | 53 | | 12thissectionandtheloan,renewalorextensiondocumentsshallbesignedbytheborrower. |
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| 54 | 54 | | 13 2.Entitiesmakingloanspursuanttothissectionshallcontractforandreceivesimple |
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| 55 | 55 | | 14interestandfeesinaccordancewithsections408.100,408.101,and408.140, andsuchloans |
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| 56 | 56 | | 15shallbesubjecttoallprovisionsofsections408.100,408.101,and408.140. Anycontract |
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| 57 | 57 | | 16evidencinganyfeeorchargeofanykindwhatsoever,exceptforbonafideclericalerrors,in |
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| 58 | 58 | | 17violationofthissectionshallbevoid.Anyperson,firmorcorporationwhoreceivesor |
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| 59 | 59 | | 18imposesafeeorchargeinviolationofthissectionshallbeguiltyofaclassAmisdemeanor. |
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| 60 | 60 | | 19 3.Notwithstandinganyotherlawtothecontrary,costofcollectionexpenses,which |
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| 61 | 61 | | 20includecourtcostsandreasonableattorneysfees,awardedbythecourtinsuittorecoverona |
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| 62 | 62 | | 21badcheckorbreachofcontractshallnotbeconsideredasafeeorchargeforpurposesofthis |
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| 63 | 63 | | 22section. |
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| 64 | 64 | | 23 4.Lenderslicensedpursuanttothissectionshallconspicuouslypostinthelobbyof |
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| 65 | 65 | | 24theoffice,inatleastfourteen-pointboldtype,themaximumannualpercentageratessuch |
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| 66 | 66 | | 25licenseeiscurrentlychargingandthestatement: |
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| 67 | 67 | | HB1325 2 26 NOTICE: |
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| 68 | 68 | | 27 Thislenderoffersshort-termloans.Pleasereadandunderstand |
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| 69 | 69 | | 28 thetermsoftheloanagreementbeforesigning. |
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| 70 | 70 | | 29 5.Thelendershallprovidetheborrowerwithanoticeinsubstantiallythefollowing |
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| 71 | 71 | | 30formsetforthinatleastten-pointboldtype,andreceiptthereofshallbeacknowledgedby |
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| 72 | 72 | | 31signatureoftheborrower: |
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| 73 | 73 | | 32 (1)Thislenderoffersshort-termloans.Pleasereadandunderstandthetermsofthe |
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| 74 | 74 | | 33loanagreementbeforesigning. |
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| 75 | 75 | | 34 (2)Youmaycancelthisloanwithoutcostsbyreturningthefullprincipalbalanceto |
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| 76 | 76 | | 35thelenderbythecloseofthelender'snextfullbusinessday. |
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| 77 | 77 | | 36 6.Thelendershallrenewtheloanupontheborrower'swrittenrequestandthe |
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| 78 | 78 | | 37paymentofanyinterestandfeesdueatthetimeofsuchrenewal;however,uponthefirst |
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| 79 | 79 | | 38renewaloftheloanagreement,andeachsubsequentrenewalthereafter,theborrowershall |
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| 80 | 80 | | 39reducetheprincipalamountoftheloanbynotlessthanfivepercentoftheoriginalamountof |
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| 81 | 81 | | 40theloanuntilsuchloanispaidinfull.However,noloanmayberenewedmorethansix |
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| 82 | 82 | | 41times. |
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| 83 | 83 | | 42 7.Whenmakingornegotiatingloans,alicenseeshallconsiderthefinancialabilityof |
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| 84 | 84 | | 43theborrowertoreasonablyrepaytheloaninthetimeandmannerspecifiedintheloan |
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| 85 | 85 | | 44contract.Allrecordsshallberetainedatleasttwoyears. |
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| 86 | 86 | | 45 8.Alicenseewhoceasesbusinesspursuanttothissectionmustnotifythedirectorto |
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| 87 | 87 | | 46requestanexaminationofallrecordswithintenbusinessdayspriortocessation.Allrecords |
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| 88 | 88 | | 47mustberetainedatleasttwoyears. |
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| 89 | 89 | | 48 9.Anylenderlicensedpursuanttothissectionwhofails,refusesorneglectsto |
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| 90 | 90 | | 49complywiththeprovisionsofthissection,oranylawsrelatingtoconsumerloansorcommits |
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| 91 | 91 | | 50anycriminalactmayhaveitslicensesuspendedorrevokedbythedirectoroffinanceaftera |
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| 92 | 92 | | 51hearingbeforethedirectoronanorderofthedirectortoshowcausewhysuchorderof |
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| 93 | 93 | | 52suspensionorrevocationshouldnotbeenteredspecifyingthegroundsthereforwhichshallbe |
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| 94 | 94 | | 53servedonthelicenseeatleasttendayspriortothehearing. |
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| 95 | 95 | | 54 10.Wheneveritshallappeartothedirectorthatanylenderlicensedpursuanttothis |
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| 96 | 96 | | 55sectionisfailing,refusingorneglectingtomakeagoodfaithefforttocomplywiththe |
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| 97 | 97 | | 56provisionsofthissection,oranylawsrelatingtoconsumerloans,thedirectormayissuean |
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| 98 | 98 | | 57ordertoceaseanddesistwhichordermaybeenforceablebyacivilpenaltyofnotmorethan |
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| 99 | 99 | | 58onethousanddollarsperdayforeachdaythattheneglect,failureorrefusalshallcontinue. |
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| 100 | 100 | | 59Thepenaltyshallbeassessedandcollectedbythedirector.Indeterminingtheamountofthe |
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| 101 | 101 | | 60penalty,thedirectorshalltakeintoaccounttheappropriatenessofthepenaltywithrespectto |
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| 102 | 102 | | HB1325 3 61thegravityoftheviolation,thehistoryofpreviousviolations,andsuchothermattersas |
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| 103 | 103 | | 62justicemayrequire. |
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| 104 | 104 | | 408.505.1.Thissectionshallapplyto: |
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| 105 | 105 | | 2 (1)Unsecuredloansmadebylenderslicensedorwhoshouldhavebeenlicensed |
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| 106 | 106 | | 3pursuanttosection408.500; |
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| 107 | 107 | | 4 (2)AnypersonthattheMissouridivisionoffinancedeterminesthathasenteredintoa |
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| 108 | 108 | | 5transactionthat,insubstance,isadisguisedloan;and |
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| 109 | 109 | | 6 (3)AnypersonthattheMissouridivisionoffinancedetermineshasengagedin |
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| 110 | 110 | | 7subterfugeforthepurposeofavoidingtheprovisionsofthissection. |
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| 111 | 111 | | 8 2.Allloansmadepursuanttothissectionandsection408.500,shallhaveaminimum |
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| 112 | 112 | | 9termoffourteendaysandamaximumtermofthirty-onedays,regardlessofwhethertheloan |
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| 113 | 113 | | 10isanoriginalloanorrenewedloan. |
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| 114 | 114 | | 11 3.Alendermayonlychargesimpleinterestandfeesinaccordancewithsections |
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| 115 | 115 | | 12408.100, 408.101,and408.140, andsuchinterestandfeesshallbesubjecttoall |
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| 116 | 116 | | 13provisionsofsections408.100,408.101,and408.140. Nootherchargesofanynatureshall |
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| 117 | 117 | | 14bepermittedexceptasprovidedbythissection,includinganychargesforcashingtheloan |
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| 118 | 118 | | 15proceedsiftheyaregivenincheckform.[However,noborrowershallberequiredtopaya |
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| 119 | 119 | | 16totalamountofaccumulatedinterestandfeesinexcessofseventy-fivepercentoftheinitial |
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| 120 | 120 | | 17loanamountonanysingleloanauthorizedpursuanttothissectionfortheentiretermofthat |
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| 121 | 121 | | 18loanandallrenewalsauthorizedbysection408.500andthissection.] |
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| 122 | 122 | | 19 4.Aloanmadepursuanttotheprovisionsofsection408.500andthissectionshallbe |
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| 123 | 123 | | 20deemedcompletedandshallnotbeconsideredarenewedloanwhenthelenderpresentsthe |
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| 124 | 124 | | 21instrumentforpaymentorthepayeeredeemstheinstrumentbypayingthefullamountofthe |
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| 125 | 125 | | 22instrumenttothelender.Oncethepayeehascompletedtheloan,thepayeemayenterintoa |
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| 126 | 126 | | 23newloanwithalender. |
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| 127 | 127 | | 24 5.Exceptasprovidedinsubsection3ofthissection,noloanmadepursuanttothis |
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| 128 | 128 | | 25sectionshallberepaidbytheproceedsofanotherloanmadebythesamelenderoranyperson |
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| 129 | 129 | | 26orentityaffiliatedwiththelender.Alender,personorentityaffiliatedwiththelendershall |
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| 130 | 130 | | 27nothavemorethanfivehundreddollarsinloansmadepursuanttosection408.500andthis |
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| 131 | 131 | | 28sectionoutstandingtothesameborroweratanyonetime.Alendercomplieswiththis |
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| 132 | 132 | | 29subsectionif: |
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| 133 | 133 | | 30 (1)Theconsumercertifiesinwritingthattheconsumerdoesnothaveanyoutstanding |
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| 134 | 134 | | 31smallloanswiththelenderwhichintheaggregateexceedsfivehundreddollars,andisnot |
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| 135 | 135 | | 32repayingtheloanwiththeproceedsofanotherloanmadebythesamelender;and |
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| 136 | 136 | | 33 (2)Thelenderdoesnotknow,orhavereasontobelieve,thattheconsumer'swritten |
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| 137 | 137 | | 34certificationisfalse. |
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| 138 | 138 | | HB1325 4 35 6.Onaconsumerloantransactionwherecashisadvancedinexchangeforapersonal |
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| 139 | 139 | | 36check,areturncheckchargemaybechargedintheamountsprovidedbysections408.653 |
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| 140 | 140 | | 37and408.654,asapplicable. |
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| 141 | 141 | | 38 7.Nostateorpublicemployeeorofficial,includingajudgeofanycourtofthisstate, |
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| 142 | 142 | | 39shallenforcetheprovisionsofanycontractforpaymentofmoneysubjecttothissection |
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| 143 | 143 | | 40whichviolatestheprovisionsofsection408.500andthissection. |
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| 144 | 144 | | 41 8.Apersondoesnotcommitthecrimeofpassingabadcheckpursuanttosection |
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| 145 | 145 | | 42570.120ifatthetimethepayeeacceptsacheckorsimilarsightorderforthepaymentof |
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| 146 | 146 | | 43money,heorshedoessowiththeunderstandingthatthepayeewillnotpresentitforpayment |
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| 147 | 147 | | 44untillaterandthepayeeknowsorhasreasontobelievethatthereareinsufficientfundson |
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| 148 | 148 | | 45depositwiththedraweeatthetimeofacceptance.However,thissectionshallnotapplyifthe |
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| 149 | 149 | | 46person'saccountonwhichtheinstrumentwaswrittenwasclosedbytheconsumerbeforethe |
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| 150 | 150 | | 47agreed-upondateofnegotiationortheconsumerhasstoppedpaymentonthecheck. |
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| 151 | 151 | | 48 9.Alendershallnotuseadeviceoragreementthatwouldhavetheeffectofcharging |
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| 152 | 152 | | 49orcollectingmorefees,charges,orinterestthanallowedbythissection,including,butnot |
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| 153 | 153 | | 50limitedto: |
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| 154 | 154 | | 51 (1)Enteringintoadifferenttypeoftransaction; |
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| 155 | 155 | | 52 (2)Enteringintoasalesleasebackarrangement; |
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| 156 | 156 | | 53 (3)Catalogsales; |
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| 157 | 157 | | 54 (4)Enteringintoanyothertransactionwiththeconsumerthatisdesignedtoevadethe |
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| 158 | 158 | | 55applicabilityofthissection. |
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| 159 | 159 | | 56 10.Theprovisionsofthissectionshallonlyapplytoentitiessubjecttotheprovisions |
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| 160 | 160 | | 57ofsection408.500andthissection. |
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| 161 | 161 | | 408.510.[Notwithstandinganyotherlawtothecontrary,]1.Forpurposesofthis |
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| 162 | 162 | | 2section,the[phrase] followingtermsmean: |
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| 163 | 163 | | 3 (1)"Consumerinstallmentlender",apersonlicensedtomakeconsumer |
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| 164 | 164 | | 4installmentloans; |
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| 165 | 165 | | 5 (2)"Consumerinstallmentloans"[means], securedorunsecuredloansofanyamount |
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| 166 | 166 | | 6andpayableinnotlessthanfoursubstantiallyequalinstallmentsoveraperiodofnotlessthan |
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| 167 | 167 | | 7onehundredtwentydays.[Thephrase"consumerinstallmentlender"meansaperson |
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| 168 | 168 | | 8licensedtomakeconsumerinstallmentloans.] |
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| 169 | 169 | | 9 2.Aconsumerinstallmentlendershallbelicensedinthesamemanneranduponthe |
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| 170 | 170 | | 10sametermsasalendermakingconsumercreditloans.[Such] |
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| 171 | 171 | | 11 3.Aconsumerinstallment[lenders] lendershallcontractforandreceiveinterestand |
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| 172 | 172 | | 12feesinaccordancewithsections408.100,408.101,408.140,and408.170[. Consumer |
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| 173 | 173 | | 13installmentlenders], andsuchinterestandfeesshallbesubjectto[the]allprovisionsof |
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| 174 | 174 | | 14sections408.100,408.101,408.140,and408.170andsections408.551to408.562. |
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| 175 | 175 | | HB1325 5 SectionB.Thisactisherebysubmittedtothequalifiedvotersofthisstatefor |
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| 176 | 176 | | 2approvalorrejectionatanelection,whichisherebyorderedandwhichshallbeheldand |
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| 177 | 177 | | 3conductedontheTuesdayimmediatelyfollowingthefirstMondayinNovember,2026,orata |
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| 178 | 178 | | 4specialelectiontobecalledbythegovernorforthatpurpose,pursuanttothelawsand |
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| 179 | 179 | | 5constitutionalprovisionsofthisstateapplicabletogeneralelectionsandthesubmissionof |
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| 180 | 180 | | 6referendummeasuresbyinitiativepetition,anditshallbecomeeffectivewhenapprovedbya |
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| 181 | 181 | | 7majorityofthevotescastthereonatsuchelectionandnototherwise. |
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| 182 | 182 | | âś” |
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| 183 | 183 | | HB1325 6 |
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