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To amend sections 1315.39, 1315.40, 1315.41, and | 1 |
1343.01 of the Revised Code to modify the | 2 |
provisions for making a loan under the | 3 |
Check-Cashing Business Loan law. | 4 |
Section 1. That sections 1315.39, 1315.40, 1315.41, and | 5 |
1343.01 of the Revised Code be amended to read as follows: | 6 |
Sec. 1315.39. | 7 |
sections 1315.35 to 1315.44 of the Revised Code may engage in the | 8 |
business of making loans provided that each loan meets all of the | 9 |
following conditions: | 10 |
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hundred dollars. | 12 |
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with | 15 |
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include any loan origination fee and all other fees and charges | 17 |
contracted for under the loan contract. | 18 |
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that sets forth the terms and conditions of the loan, and | 20 |
discloses in a clear and concise manner all of the following: | 21 |
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be required to pay in connection with the loan pursuant to the | 23 |
loan contract; | 24 |
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contract | 26 |
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rate based on the sum of the principal of the loan and the loan | 28 |
origination fee, | 29 |
charges contracted for under the loan contract; | 30 |
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due, and the total number of payments that the borrower will be | 32 |
required to make under the loan contract; | 33 |
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size of ten points, as follows: "WARNING: The rate of interest | 35 |
charged on this loan is higher than the average rate of interest | 36 |
charged by financial institutions on substantially similar | 37 |
loans." | 38 |
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of retiring an existing loan between the check-cashing business | 40 |
and that borrower, which existing loan was made pursuant to | 41 |
sections 1315.35 to 1315.44 of the Revised Code. | 42 |
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Sec. 1315.40. In addition to the interest authorized to be | 55 |
contracted for and received pursuant to section 1315.39 of the | 56 |
Revised Code, a check-cashing business licensed pursuant to | 57 |
sections 1315.35 to 1315.44 of the Revised Code may charge, | 58 |
collect, and receive the following fees and charges in connection | 59 |
with a loan made under sections 1315.35 to 1315.44 of the Revised | 60 |
Code: | 61 |
(A) | 62 |
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exceeding an amount equal to twenty dollars plus any amount passed | 68 |
on from other financial institutions for each check, negotiable | 69 |
order of withdrawal, share draft, or other negotiable instrument | 70 |
returned or dishonored for any reason, provided that the terms and | 71 |
conditions upon which check collection charges will be charged to | 72 |
the borrower are set forth in the written loan contract described | 73 |
in division
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check-cashing business may become entitled to by law in connection | 76 |
with any civil action to collect a loan after default. | 77 |
Sec. 1315.41. No check-cashing business licensed pursuant to | 78 |
sections 1315.35 to 1315.44 of the Revised Code shall do any of | 79 |
the following: | 80 |
(A) Violate section 1315.36 of the Revised Code; | 81 |
(B) Make a loan that does not comply with | 82 |
section 1315.39 of the Revised Code; | 83 |
(C) Charge, collect, or receive, directly or indirectly, any | 84 |
additional fees or charges in connection with a loan, other than | 85 |
fees and charges permitted by sections 1315.39 and 1315.40 of the | 86 |
Revised Code and costs or disbursements to which the check-cashing | 87 |
business may become entitled to by law in connection with any | 88 |
civil action to collect a loan after default; | 89 |
(D) Collect treble damages pursuant to division (A)(1)(b)(ii) | 90 |
of section 2307.61 of the Revised Code in connection with any | 91 |
civil action to collect a loan after a default due to a check, | 92 |
negotiable order of withdrawal, share draft, or other negotiable | 93 |
instrument that was returned or dishonored for insufficient funds; | 94 |
(E) Make a loan to a borrower if there exists an outstanding | 95 |
loan between the check-cashing business and that borrower and if | 96 |
the outstanding loan was made pursuant to sections 1315.35 to | 97 |
1315.43 of the Revised Code; | 98 |
(F) Accept a check or other method of access to a deposit | 99 |
account maintained by the borrower, or the title of a vehicle as | 100 |
security for the obligation. | 101 |
Sec. 1343.01. (A) The parties to a bond, bill, promissory | 102 |
note, or other instrument of writing for the forbearance or | 103 |
payment of money at any future time, may stipulate therein for the | 104 |
payment of interest upon the amount thereof at any rate not | 105 |
exceeding eight per cent per annum payable annually, except as | 106 |
authorized in division (B) of this section. | 107 |
(B) Any party may agree to pay a rate of interest in excess | 108 |
of the maximum rate provided in division (A) of this section when: | 109 |
(1) The original amount of the principal indebtedness | 110 |
stipulated in the bond, bill, promissory note, or other instrument | 111 |
of writing exceeds one hundred thousand dollars; | 112 |
(2) The payment is to a broker or dealer registered under the | 113 |
"Securities Exchange Act of 1934," 48 Stat. 881, 15 U.S.C. 78A, as | 114 |
amended, for carrying a debit balance in an account for a customer | 115 |
if such debit balance is payable on demand and secured by stocks, | 116 |
bonds or other securities; | 117 |
(3) The instrument evidences a loan secured by a mortgage or | 118 |
deed of trust on real estate where the loan has been approved, | 119 |
insured, guaranteed, purchased, or for which an offer or | 120 |
commitment to insure, guarantee, or purchase has been received, in | 121 |
whole or in part, by the federal government or any agency or | 122 |
instrumentality thereof, the federal national mortgage | 123 |
association, the federal home loan mortgage corporation, or the | 124 |
farmers home administration, all of which is authorized pursuant | 125 |
to the "National Housing Act," 12 | 126 |
Readjustment Act," 38 U.S.C. 1801; the "Federal Home Loan Bank | 127 |
Act," 12 U.S.C. 1421; and the "Rural Housing Act," 42 U.S.C. 1471, | 128 |
amendments thereto, reenactments thereof, enactments parallel | 129 |
thereto, or in substitution therefor, or regulations issued | 130 |
thereunder; or by the state or any agency or instrumentality | 131 |
thereof authorized pursuant to Chapter 122. of the Revised Code, | 132 |
or rules issued thereunder. | 133 |
(4) The instrument evidences a loan secured by a mortgage, | 134 |
deed of trust, or land installment contract on real estate which | 135 |
does not otherwise qualify for exemption from the provisions of | 136 |
this section, except that such rate of interest shall not exceed | 137 |
eight per cent in excess of the discount rate on ninety-day | 138 |
commercial paper in effect at the federal reserve bank in the | 139 |
fourth federal reserve district at the time the mortgage, deed of | 140 |
trust, or land installment contract is executed. | 141 |
(5) The instrument is payable on demand or in one installment | 142 |
and is not secured by household furnishings or other goods used | 143 |
for personal, family, or household purposes, or the instrument is | 144 |
payable in any number of installments and is a written loan | 145 |
contract made under sections 1315.35 to 1315.44 of the Revised | 146 |
Code. | 147 |
(6)(a) The loan is a business loan to a business association | 148 |
or partnership, a person owning and operating a business as a sole | 149 |
proprietor; any persons owning and operating a business as joint | 150 |
venturers, joint tenants, or tenants in common; any limited | 151 |
partnership; or any trustee owning or operating a business or | 152 |
whose beneficiaries own or operate a business, except that: | 153 |
(i) Any loan which is secured by an assignment of an | 154 |
individual obligor's salary, wages, commissions, or other | 155 |
compensation for services or by | 156 |
household furniture or other goods used for | 157 |
obligor's personal, family, or household purposes shall be deemed | 158 |
not a loan within the meaning of division (B)(6) of this section; | 159 |
(ii) Any loan which otherwise qualifies as a business loan | 160 |
within the meaning of division (B)(6) of this section shall not be | 161 |
deemed disqualified because of the inclusion, with other security | 162 |
consisting of business assets of any such obligor, of real estate | 163 |
occupied by an individual obligor solely as | 164 |
obligor's residence. | 165 |
(b) As used in division (B)(6)(a) of this section, "business" | 166 |
means a commercial, agricultural, or industrial enterprise which | 167 |
is carried on for the purpose of investment or profit. "Business" | 168 |
does not mean the ownership or maintenance of real estate occupied | 169 |
by an individual obligor solely as | 170 |
residence. | 171 |
Section 2. That existing sections 1315.39, 1315.40, 1315.41, | 172 |
and 1343.01 of the Revised Code are hereby repealed. | 173 |