Oklahoma 2022 Regular Session

Oklahoma Senate Bill SB796 Compare Versions

Version 1 (Old)

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4		-	An Act
5		-	ENROLLED SENATE
	29	+	HOUSE OF REPRESENTATIVES - FLOOR VERSION
	30	+
	31	+	STATE OF OKLAHOMA
	32	+
	33	+	1st Session of the 58th Legislature (2021)
	34	+
	35	+	ENGROSSED SENATE
6	36		BILL NO. 796 By: Leewright of the Senate
7	37
8	38		and
9	39
10	40		McEntire of the House
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17	47		An Act relating to Uniform Consumer Credit Code;
18	48		amending 14A O.S. 2011, Sections 1 -106, as last
19	49		amended by Section 1, Chapter 178, O.S.L. 2019 and 3 -
20	50		109 (14A O.S. Supp. 2020, Section 1 -106), which
21	51		relate to change in dollar amounts and definitions;
22	52		adding references; amending 14A O.S. 2011, Section 3 -
23	53		508A, as last amended by Section 1, Chapter 89,
24	54		O.S.L. 2015 (14A O.S. Supp. 2020, Section 3 -508A),
25	55		which relates to finance rate for supervised loans;
26	56		changing loan principal amounts; permitting a loan
27	57		closing fee; setting closing fee amount; and
28	58		providing an effective date.
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33		-	SUBJECT: Uniform Consumer Credit Code
34		-
35	63		BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
36		-
37	64		SECTION 1. AMENDATORY 14A O.S. 2011, Section 1 -106, as
38	65		last amended by Section 1, Chapter 178, O.S.L. 2019 (14A O.S. Supp.
39	66		2020, Section 1-106), is amended to re ad as follows:
40		-
41	67		Section 1-106. (1) From time to time the dollar amounts in
42	68		paragraphs (a), (b) and (c) of subsection (2) of Section 2 -201,
43	69		paragraph (a) of subsection (1) of Section 2 -203, subsection (1) of
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44	97		Section 2-407, Section 2-413, paragraph (b) of s ubsection (1) of
45	98		Section 3-203, Section 3-203.1, subsection (4) of Section 3 -508A,
46	99		subsection (1) of Section 3 -508B, subsection (1) of Section 3 -510,
47		-
48		-	ENR. S. B. NO. 796 Page 2
49	100		paragraphs (a) and (b) of Section 3 -511, Section 3-514, and
50	101		subsections (2) and (3) of Section 5 -103 of the Uniform Consumer
51	102		Credit Code, are hereby designated as subject to change and shall
52	103		change, as provided in this section and the rules of the
53	104		Administrator, according to and to the extent of changes in the
54	105		Consumer Price Index for Urban Wage Earners and Cl erical Workers:
55	106		U.S. City Average, All Items, 1967=100, compiled by the Bureau of
56	107		Labor Statistics, United States Department of Labor, and hereafter
57	108		referred to as the Index. The Index for December of the year 1973
58	109		shall be deemed the Reference Base Index . The dollar amounts
59	110		established by rule of the Administrator in paragraph (e) of
60	111		subsection (1) of Section 2 -104, paragraph (b) of subsection (1) of
61	112		Section 2-106 and paragraph (d) of Section 3 -104 of the Uniform
62	113		Consumer Credit Code in effect on January 1, 1982, shall remain in
63	114		full force and effect.
64		-
65	115		(2) The designated dollar amounts shall change on July 1 of
66	116		each year if the percentage of change, calculated to the nearest
67	117		whole percentage point, between the Index at the end of the
68	118		preceding year and th e Reference Base Index is ten percent (10%) or
69	119		more, but:
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71	147		(a) the portion of the percentage change in the Index in
72	148		excess of a multiple of ten percent (10%) shall be
73	149		disregarded and the dollar amounts shall change only
74	150		in multiples of ten percent (10%) of the amounts
75	151		appearing in the Uniform Consumer Credit Code; and
76		-
77	152		(b) the dollar amounts shall not change if the amounts
78	153		required by this section are those currently in effect
79	154		pursuant to the Uniform Consumer Credit Code as a
80	155		result of earlier application of this section.
81		-
82	156		(3) If the Index is revised, the percentage of change pursuant
83	157		to this section shall be calculated on the basis of the revised
84	158		Index. If a revision of the Index changes the Reference Base Index,
85	159		a revised Reference Base Index shall be deter mined by multiplying
86	160		the Reference Base Index then applicable by the rebasing factor
87	161		furnished by the United States Bureau of Labor Statistics. If the
88	162		Index is superseded, the Index referred to in this section shall be
89	163		the one represented by the United St ates Bureau of Labor Statistics
90		-
91		-	ENR. S. B. NO. 796 Page 3
92	164		as reflecting most accurately changes in the purchasing power of the
93	165		dollar for consumers.
94		-
95	166		(4) The rules of the Administrator shall:
96		-
97	167		(a) include the method for calculating the changes in
98	168		dollar amounts required by subsectio n (2) of this
99	169		section;
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101	197		(b) be amended in accordance with the Administrative
102	198		Procedures Act to include changes in the Index
103	199		required by subsection (3) of this section including,
104	200		if applicable, the numerical equivalent of the
105	201		Reference Base Index under a rev ised Reference Base
106	202		Index and the designation or title of any index
107	203		superseding the Index; and
108		-
109	204		(c) provide for appropriate notice to licensees and other
110	205		interested persons of any changes in the dollar
111	206		amounts which result from changes required by
112	207		subsection (2) of this section no later than April 30
113	208		of each year. Each dollar amount subject to change as
114	209		provided in this section shall be listed in an
115	210		appendix to the rules of the Administrator and shall
116	211		be published in the Oklahoma Administrative Code.
117	212		Changes to the appendix shall be submitted to the
118	213		Secretary of State prior to the annual deadline for
119	214		submitting material for publication in the Code.
120	215		Changes in the appendix shall not be construed as
121	216		rulemaking.
122		-
123	217		(5) A person does not violate the Uniform Cons umer Credit Code
124	218		with respect to a transaction otherwise complying with the Uniform
125	219		Consumer Credit Code if he or she relies on dollar amounts either
126	220		determined according to subsection (2) of this section or appearing
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127	248		in the last rule of the Administrator announcing the then current
128	249		dollar amounts.
129		-
130	250		SECTION 2. AMENDATORY 14A O.S. 2011, Section 3 -109, is
131	251		amended to read as follows:
132		-
133	252		Section 3-109.
134		-
135		-	ENR. S. B. NO. 796 Page 4
136		-
137	253		(1) (a) "Loan finance charge" means a finance charge composed
138	254		of the sum of:
139		-
140	255		(i) all charges payable directly or indirectly by the
141	256		debtor and imposed directly or indirectly by the
142	257		lender as an incident to the extension of credit,
143	258		including any of the following types of charges,
144	259		which are applicable: interest or any amount
145	260		payable under a point, discount, or other system
146	261		of charges, however denominated, premium or other
147	262		charge for any guarantee or insurance protecting
148	263		the lender against the debtor 's default or other
149	264		credit loss; and
150		-
151	265		(ii) charges incurred for investigating the collateral
152	266		or credit worthiness of the debtor or for
153	267		commissions or brokerage for obtaining the
154	268		credit, irrespective of the person to whom the
155	269		charges are paid or payable unless the lender had
156	270		no notice of the charges when the loan was made.
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158	298		(b) The term does not include c harges as a result of
159	299		default, additional charges under Section Sections 3-
160	300		202 and subsection (4) of 3 -508A of this title,
161	301		delinquency charges under Section 3 -203 of this title,
162	302		deferral charges under Section 3 -204 of this title,
163	303		charges of a type payable in a comparable cash
164	304		transaction, or sellers points. The finance charge
165	305		shall not include fees and amounts imposed by third -
166	306		party closing agents, including settlement agents,
167	307		attorneys, and escrow and title companies, if the
168	308		creditor does not require the imposition of the
169	309		charges or the services provided and does not retain
170	310		the charges. Examples of charges which are included
171	311		in the finance charge include any of the following
172	312		types of charges which are applicable:
173		-
174	313		(i) Interest, time price differential, and any amount
175	314		payable under a point, discount, or other system
176	315		of additional charges;
177		-
178		-
179		-	ENR. S. B. NO. 796 Page 5
180	316		(ii) Service or carrying charge;
181		-
182	317		(iii) Loan fee, finder's fee, or similar charge;
183		-
184	318		(iv) Fee for an investigation or credit report;
185		-
186	319		(v) Premium or other charge for any guaran tee or
187	320		insurance protecting the creditor against the
188	321		obligor's default or other credit loss; and
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190	349		(vi) Borrower-paid mortgage broker fees, including
191	350		fees paid directly to the broker or the lender,
192	351		for delivery to the broker, whether such fees are
193	352		paid in cash or financed.
194		-
195	353		(2) If a lender makes a loan to a debtor by purchasing or
196	354		satisfying obligations of the debtor pursuant to a lender credit
197	355		card or similar arrangement, and the purchase or satisfaction is
198	356		made at less than the face amount of the obligation , the discount is
199	357		not part of the loan finance charge.
200		-
201	358		SECTION 3. AMENDATORY 14A O.S. 2011, Section 3 -508A, as
202	359		last amended by Section 1, Chapter 89, O.S.L. 2015 (14A O.S. Supp.
203	360		2020, Section 3-508A), is amended to read as follows:
204		-
205	361		Section 3-508A. (1) With respect to a supervised loan,
206	362		including a loan pursuant to a revolving loan account, a supervised
207	363		lender may contract for and receive a loan finance charge not
208	364		exceeding that permitted by this section.
209		-
210	365		(2) The loan finance charg e, calculated according to the
211	366		actuarial method, may not exceed the equivalent of the greater of
212	367		either of the following:
213		-
214	368		(a) the total of:
215		-
216	369		(i) twenty-seven percent (27%) thirty-two percent
217	370		(32%) per year on that part of the unpaid
218	371		balances of the principa l which is Two Thousand
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219	399		Nine Hundred Ten Dollars ($2,910.00) Seven
220	400		Thousand Dollars ($7,000.00) or less;
221		-
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223		-	ENR. S. B. NO. 796 Page 6
224	401		(ii) twenty-three percent (23%) per year on that part
225	402		of the unpaid balances of the principal which is
226	403		more than Two Thousand Nine Hundred Ten Dollars
227	404		($2,910.00) Seven Thousand Dollars ($7,000.00)
228	405		but does not exceed Six Thousand Two Hundred
229	406		Dollars ($6,200.00) Eleven Thousand Dollars
230	407		($11,000.00); and
231		-
232	408		(iii) twenty percent (20%) per year on that part of
233	409		the unpaid balances of the principal which is
234	410		more than Six Thousand Two Hundred Dollars
235	411		($6,200.00) Eleven Thousand Dollars ($11,000.00) ;
236	412		or
237		-
238	413		(b) twenty-five percent (25%) per year on the unpaid
239	414		balances of the principal.
240		-
241	415		(3) This section does not limit or restrict the manner of
242	416		contracting for the loan finance charge, whether by way of add -on,
243	417		discount, or otherwise, so long as the rate of the loan finance
244	418		charge does not exceed that permitted by this section. If the loan
245	419		is precomputed:
246		-
247	420		(a) the loan finance charge may be calculated on the
248	421		assumption that all scheduled payments will be made
249	422		when due; and
250	423
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251	450		(b) the effect of prepayment is governed by the provisions
252	451		on rebate upon prepayment (Section 3 -210).
253		-
254	452		(4) In addition to the loan finance charge permitted in this
255	453		section and other charges permitted in this act, a supervised lender
256	454		may assess a lender closing fee not to exceed Twenty -eight Dollars
257	455		and eighty-five cents ($28.85) upon consummation of the loan.
258		-
259	456		(5) The term of a loan, for the purpose of this section,
260	457		commences on the date the loan is made. Differences in the lengths
261	458		of months are disregarded and a day may be counted as one -thirtieth
262	459		(1/30) of a month. Subject to classifications and differentiations
263	460		the lender may reasonably establish, a part of a month in excess of
264	461		fifteen (15) days may b e treated as a full month if periods of
265	462		fifteen (15) days or less are disregarded and if that procedure is
266		-
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268	463		not consistently used to obtain a greater yield than would otherwise
269	464		be permitted.
270		-
271	465		(5) (6) Subject to classifications and differentiations the
272	466		lender may reasonably establish, he may make the same loan finance
273	467		charge on all principal amounts within a specified range. A loan
274	468		finance charge so made does not violate subsection (2) of this
275	469		section if:
276		-
277	470		(a) when applied to the median amount within each ran ge,
278	471		it does not exceed the maximum permitted in subsection
279	472		(2) of this section; and
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281	500		(b) when applied to the lowest amount within each range,
282	501		it does not produce a rate of loan finance charge
283	502		exceeding the rate calculated according to paragraph
284	503		(a) of this subsection by more than eight percent (8%)
285	504		of the rate calculated according to paragraph (a) of
286	505		this subsection.
287		-
288	506		SECTION 4. This act shall become effective November 1, 2021.
289	507
290		-
291		-	ENR. S. B. NO. 796 Page 8
292		-	Passed the Senate the 11th day of March, 2021.
293		-
294		-
295		-
296		-	Presiding Officer of the Senate
297		-
298		-
299		-	Passed the House of Representatives the 14th day of April, 2021.
300		-
301		-
302		-
303		-	Presiding Officer of the House
304		-	of Representatives
305		-
306		-	OFFICE OF THE GOVERNOR
307		-	Received by the Office of the Governor this _______ _____________
308		-	day of _________________ __, 20_______, at _______ o'clock _______ M.
309		-	By: _______________________________ __
310		-	Approved by the Governor of the State of Oklahoma this _____ ____
311		-	day of _________________ __, 20_______, at _______ o'clock _______ M.
312		-
313		-	_________________________________
314		-	Governor of the State of Oklahoma
315		-
316		-
317		-	OFFICE OF THE SECRETARY OF STATE
318		-	Received by the Office of the Secretary of State this _______ ___
319		-	day of __________________, 20 _______, at _______ o'clock _______ M.
320		-	By: _______________________________ __
	508	+	COMMITTEE REPORT BY: COMMITTEE ON BANKING, FINANCIAL SERVICES AN D
	509	+	PENSIONS, dated 03/29/2021 - DO PASS.