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(124th General Assembly)
(House Bill Number 229)
AN ACT
To amend section 1317.08 of the Revised Code to
eliminate, in the purchase, assignment, or
transfer
of a retail installment
contract the
prohibition
against a retail
seller, receiving in
excess of 2%
of the principal balance on that
contract, and to
eliminate related provisions.
Be it enacted by the General Assembly of the State of Ohio:
SECTION 1. That section 1317.08 of the Revised Code be
amended to read as follows:
Sec. 1317.08. (A)(1) No retail installment contract that
evidences an indebtedness greater than that allowed under
sections
1317.06, 1317.061, 1317.062, and
1317.07 of the Revised Code, and
no retail installment
contract in connection with which any charge
prohibited by
sections 1317.01 to 1317.11 of the Revised Code has
been contracted for or received, shall be enforceable with respect
to that excess indebtedness or charge against any
retail buyer or
any other person who as surety, indorser,
guarantor, or otherwise
is liable on the obligation created by
any retail buyer on any
retail installment contract, and no.
(2) No security interest created by any
such retail
installment contract
described in division (A)(1) of this section
that is greater than that allowed under
sections 1317.06, 1317.07,
and
1317.071 of the Revised Code shall be
enforceable with respect
to that excess security interest against any
retail buyer or any
of the
aforementioned
persons
described in division (A)(1) of this
section, in default under the terms of the retail installment
contract.
In
(B) In order for a retail buyer, or any of the
aforementioned
persons
described in division (A)(1) of this section that is
liable on the retail buyer's
obligation, to avail the retail buyer
or other person of
this section,
the retail buyer or other person
must prove that the retail
seller or the holder of the retail
installment contract has been notified in
writing of the
overcharge and has failed within ten days of such
notification to
advise the retail buyer of a full credit, or the
retail buyer or
other person must prove that the overcharge has
been willful. A
correction of
any overcharge within sixty days of the date of
making of the
retail installment contract is conclusive proof of
lack of
willfulness.
This
(C) This section applies to cases in which recovery is
sought from the retail seller or holder of the retail installment
contract. (D) If charges greater in amount than those provided for in
sections 1317.01 to 1317.11 of the Revised Code are
contracted for
or received by the retail seller or the
retail seller's agent,
assignee, or successor in interest, the retail buyer or the
retail
buyer's assignee or successor in interest may recover the
total
amount of finance charges paid to the retail seller
or the retail
seller's agent,
assignee, or successor in interest, in excess of
the interest rate
that otherwise would apply under section 1343.01
of the Revised Code. No person shall enter into any agreement with any retail
seller regarding the purchase, assignment, or transfer of any
retail installment contract whereby the retail seller shall
receive or retain, directly or indirectly, any benefit from or
part of any amount collected or received, or to be collected or
received, from any retail buyer as a finance charge or as the
cost
of insurance or other benefits to the retail buyer, in
excess of
two per cent of the principal balance of the retail
installment
contract. No person shall, directly or indirectly,
pay to the
retail seller, and no retail seller shall, directly or
indirectly,
receive or retain any part of the amount collected,
or to be
collected, as a finance charge or retail buyer's cost of
insurance
or other benefits on any retail installment contract
purchased,
assigned, or transferred from the retail seller,
in excess of two
per cent of the principal balance of the retail installment
contract, provided this paragraph does not apply in case of a
bona
fide sale of a retail installment contract, if, as part of
the
consideration for such sale and purchase, the retail seller
agrees
to act, and does act, as agent for the purchaser in making
collection of all amounts due on and otherwise completely
servicing the retail installment contract, including
billing,
posting, and maintaining complete records applicable thereto.
Compensation received by the retail seller as commission
received by the retail seller from an insurance company as
its
licensed agent,
is not a benefit received by the retail seller out
of the
insurance charge to the retail buyer under the installment
contract. Any sale, assignment, or transfer of a retail
installment contract in violation of this section is void.
Except
as specifically limited by this paragraph all instruments
that are
a part of a retail installment contract are
freely assignable and
transferable.
SECTION 2. That existing section 1317.08 of the Revised Code
is hereby repealed.
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