To amend sections 1315.26, 1321.02, 1321.12, 1321.13, 1321.131, 1321.14, 1321.15, 1321.44, 1321.52, 1321.53, 1321.551, 1321.56, 1321.57, 1321.571, 1321.59, 1321.99, 1322.01, 1343.01, 1345.01, 4710.02, 4712.01, and 4712.07 and to enact sections 1321.011, 1321.542, 1321.591, 1321.61, and 1351.031 of the Revised Code to establish various consumer protections regarding small and short-term loans.

Section 1. That sections 1315.26, 1321.02, 1321.12, 1321.13, 1321.131, 1321.14, 1321.15, 1321.44, 1321.52, 1321.53, 1321.551, 1321.56, 1321.57, 1321.571, 1321.59, 1321.99, 1322.01, 1343.01, 1345.01, 4710.02, 4712.01, and 4712.07 be amended and sections 1321.011, 1321.542, 1321.591, 1321.61, and 1351.031 of the Revised Code be enacted to read as follows:

Sec. 1315.26.  (A) No check-cashing business shall charge check-cashing fees or other check-cashing charges in an amount that exceeds three per cent of the face amount of the check for cashing checks issued by this state, a state agency, a political subdivision of this state, or the United States.

(B) Each check-cashing business shall conspicuously post and at all times display in every business location a schedule of its fees and charges for all services permitted under sections 1315.21 to 1315.28 of the Revised Code.

(C) No check-cashing business shall charge or receive a fee for cashing a proceeds check or money order disbursed to fund a loan made by the licensee or an affiliate of the licensee.

Sec. 1321.011. A violation of section 1321.02, 1321.11, 1321.12, 1321.13, 1321.14, 1321.15, or 1321.17 of the Revised Code may be enforced pursuant section 1321.61 of the Revised Code when the violation involves a loan of one thousand dollars or less.

Sec. 1321.02.  No person shall engage in the business of lending money, credit, or choses in action in amounts of five thousand dollars or less, or and thereby exact, contract for, or receive, directly or indirectly, on or in connection with any such loan, any interest and charges that in the aggregate are greater than the interest and charges that the lender would be permitted to charge for a loan of money if the lender were not a licensee, without first having obtained a license from the division of financial institutions under sections 1321.01 to 1321.19 of the Revised Code. No person not located in Ohio shall make a loan under sections 1321.01 to 1321.19 of the Revised Code to a borrower in Ohio from an office not located in Ohio. Nothing in this section prohibits a business not located or licensed in Ohio from lending funds to Ohio borrowers who physically visit the out-of-state office of the business and obtain the disbursement of loan funds at that location.

Sections 1321.01 to 1321.19 of the Revised Code do not apply to any person doing business under and as permitted by any law of this state, another state, or the United States relating to banks, savings banks, savings societies, trust companies, credit unions, savings and loan associations substantially all the business of which is confined to loans on real estate mortgages and evidences of their own indebtedness; to registrants conducting business pursuant to sections 1321.51 to 1321.60 of the Revised Code; to persons making loans that constitute business loans as described in division (B)(5) of section 1343.01 of the Revised Code, except as provided in division (B) of section 1321.12 of the Revised Code; to licensees conducting business pursuant to sections 1321.71 to 1321.83 of the Revised Code; to licensees doing business pursuant to sections 1321.35 to 1321.48 of the Revised Code; or to any entity who is licensed pursuant to Title XXXIX of the Revised Code, who makes advances or loans to any person who is licensed to sell insurance pursuant to that Title, and who is authorized in writing by that entity to sell insurance. No person engaged in the business of selling tangible goods or services related thereto may receive or retain a license under sections 1321.01 to 1321.19 of the Revised Code for such place of business.

The first paragraph of this section applies to any person, who by any device, subterfuge, or pretense, charges, contracts for, or receives greater interest, consideration, or charges than that authorized by this section for any such loan or use of money or for any such loan, use, or sale of credit, or who for a fee or any manner of compensation arranges or offers to find or arrange for another person to make any such loan, use, or sale of credit. This section does not preclude the acquiring, directly or indirectly, by purchase or discount, of a bona fide obligation for goods or services when such obligation is payable directly to the person who provided the goods or services.

Any contract of loan in the making or collection of which an act is done by the lender that violates this section is void and the lender has no right to collect, receive, or retain any principal, interest, or charges.

Sec. 1321.12.  (A) No licensee shall conduct the business of making loans under sections 1321.01 to 1321.19 of the Revised Code, within any office, room, or place of business in which any other business is solicited or engaged in, or in association or conjunction therewith, if the division of financial institutions finds, after hearing, that the other business is of such nature that such conduct tends to conceal evasion of those sections or of the rules made under those sections and orders the licensee in writing to desist from the conduct. For purposes of this division, "other business" includes any business conducted by a person who is registered or is required to be registered as a credit services organization under section 4712.02 of the Revised Code, licensed as a check-cashing business under section 1315.22 of the Revised Code, engaged in the practice of debt adjusting pursuant to Chapter 4710. of the Revised Code, or is a lessor as defined in section 1351.01 of the Revised Code.

(B) No licensee or affiliate of a licensee shall make any business loan of five thousand dollars or less at the licensee's authorized place of business in this state that does not conform with the interest and fee limitations in sections 1321.13 to 1321.16 of the Revised Code.

(C) No licensee shall conduct the business of making loans under sections 1321.01 to 1321.19 of the Revised Code, under any other name, or at any other place of business within this state than that named in the license.

(D) No licensee shall take a lien upon real estate as security for any loan made under those sections except such lien as is created upon the filing or recording of a certificate of judgment.

(E) No licensee shall use unfair, deceptive, or unconscionable means to collect or attempt to collect any claim. Without limiting the general application of the foregoing, the conduct described in divisions (A) to (G) of section 1321.591 of the Revised Code is deemed to violate this section.

Sec. 1321.13.  (A) Notwithstanding any other provisions of the Revised Code other than division (C) of section 1321.15 of the Revised Code, a licensee may contract for and receive interest, calculated according to the actuarial method, at a rate or rates not exceeding twenty-eight per cent per year on that portion of the unpaid principal balance of the loan not exceeding one thousand dollars and twenty-two per cent per year on any part of the unpaid principal balance exceeding one thousand dollars. A licensee may contract for and receive interest at the single annual rate that would earn the same total interest at maturity of the loan, when the loan is paid according to its agreed terms, as would be earned by the application of the graduated rates set forth in this division. Loans may be interest-bearing or precomputed.

(B) For purposes of computation of time on interest-bearing and precomputed loans, including, but not limited to, the calculation of interest, a month is considered one-twelfth of a year, and a day is considered one three hundred sixty-fifth of a year when calculation is made for a fraction of a month. A year is as defined in section 1.44 of the Revised Code. A month is that period described in section 1.45 of the Revised Code.

(C) With respect to interest-bearing loans:

(1) Interest shall be computed on unpaid principal balances outstanding from time to time, for the time outstanding. Each payment shall be applied first to unpaid charges and fees, then to interest, and the remainder to the unpaid principal balance. However, if the amount of the payment is insufficient to pay the accumulated interest, the unpaid interest continues to accumulate to be paid from the proceeds of subsequent payments and is not added to the principal balance. If the maturity of the loan is accelerated for any reason and judgment is entered, the licensee may thereafter charge the same rate or rates of interest as provided in the loan contract.

(2) Interest shall not be compounded. However, if part or all of the consideration for a new loan contract is the unpaid principal balance of a prior loan, then the principal amount payable under the new loan contract may include any unpaid interest that has accrued. The resulting loan contract shall be deemed a new and separate loan transaction for purposes of this section. The unpaid principal balance of a precomputed loan is the balance due after refund or credit of unearned interest as provided in division (D)(3) of this section.

(D) With respect to precomputed loans:

(1) Loans shall be repayable in substantially equal and consecutive monthly installments of principal and interest combined, except that the first installment period may exceed one month by not more than fifteen days, and the first installment payment amount may be larger than the remaining payments by the amount of interest charged for the extra days; and provided further that monthly installment payment dates may be omitted to accommodate borrowers with seasonal income.

(2) Payments may be applied to the combined total of principal and precomputed interest until maturity of the loan. A licensee may charge interest after the original or deferred maturity of a precomputed loan at the rate or rates provided in division (A) of this section on all unpaid principal balances for the time outstanding.

(3) When any loan contract is paid in full by cash, renewal, refinancing, or a new loan, one month or more before the final installment due date, the licensee shall refund, or credit the borrower with, the total of the applicable charges for all fully unexpired installment periods, as originally scheduled or as deferred, that follow the day of prepayment. If the prepayment is made other than on a scheduled installment installment due date, the nearest scheduled due date shall be used in such computation. If the prepayment occurs prior to the first installment due date, the licensee may retain one-thirtieth of the applicable charge for a first installment period of one month for each day from date of loan to date of prepayment, and shall refund, or credit the borrower with, the balance of the total interest contracted for. If the maturity of the loan is accelerated for any reason and judgment is entered, the licensee shall credit the borrower with the same refund as if prepayment in full had been made on the date the judgment is entered and may thereafter convert the loan to an interest-bearing loan at the same rate or rates of interest as provided in the loan contract. If the maturity of the loan is accelerated for any reason, the licensee may convert the loan to an interest-bearing loan at the same rate or rates of interest as provided in the loan contract, provided the licensee credits the borrower with the same refund on the precomputed loan as if prepayment in full had been made on the date of the conversion.

(4) If the parties agree in writing, either in the loan contract or in a subsequent agreement, to a deferment of wholly unpaid installments, a licensee may grant a deferment and may collect a deferment charge as provided in this section. A deferment postpones the scheduled due date of the earliest unpaid installment and all subsequent installments as originally scheduled, or as previously deferred, for a period equal to the deferment period. The deferment period is that period during which no installment is scheduled to be paid by reason of the deferment. The deferment charge for a one-month period may not exceed the applicable charge for the installment period immediately following the due date of the last undeferred installment. A proportionate charge may be made for deferment for periods of more or less than one month. A deferment charge is earned prorata during the deferment period and is fully earned on the last day of the deferment period. If a loan is prepaid in full during a deferment period, the licensee shall make, or credit to the borrower, a refund of the unearned deferment charge in addition to any other refund or credit made for prepayment of the loan in full.

(E) A licensee, at the request of the borrower, may obtain, on one or more borrowers, credit life insurance, credit accident and health insurance, and unemployment insurance. The premium or identifiable charge for the insurance may be included in the principal amount of the loan and may not exceed the premium rate filed by the insurer with the superintendent of insurance and not disapproved by him the superintendent. If a licensee obtains the insurance at the request of the borrower, the borrower shall have the right to cancel the insurance for a period of twenty-five days after the loan is made. If the borrower chooses to cancel the insurance, the borrower shall give the licensee written notice of this choice and shall return all of the policies or certificates of insurance or notices of proposed insurance to the licensee during such period, and the full premium or identifiable charge for the insurance shall be refunded to the borrower by the licensee. If the borrower requests, in the notice to cancel the insurance, that this refund be applied to reduce the balance of a precomputed loan, the licensee shall credit the amount of the refund plus the amount of interest applicable to the refund to the loan balance.

(F) A licensee may require the borrower to provide insurance or a loss payable endorsement covering reasonable risks of loss, damage, and destruction of property used as security for the loan and with the consent of the borrower such insurance may cover property other than that which is security for the loan. The amount and term of required property insurance shall be reasonable in relation to the amount and term of the loan contract and the type and value of the security, and the insurance shall be procured in accordance with the insurance laws of this state. The purchase of this insurance through the licensee or an agent or broker designated by the licensee shall not be a condition precedent to the granting of the loan. If the borrower purchases the insurance from or through the licensee or from another source, the premium may be included in the principal amount of the loan.

(G) In addition to the interest and charges provided for by this section, no further or other amount shall be charged, received, or required by the licensee, except the amounts of fees authorized by law to record, file, or release security interests on a loan and fees for credit reports, which amounts may be included in the principal amount of the loan or collected at any time after the loan is made, and except costs and disbursements to which the licensee may become entitled by law in connection with any suit to collect a loan or any lawful activity to realize on a security interest after default.

(H) If the loan contract or security instrument contains covenants by the borrower to perform certain duties pertaining to insuring or preserving security and the licensee pursuant to the loan contract or security instrument pays for performance of the duties on behalf of the borrower, the licensee may add the amounts paid to the unpaid principal balance of the loan or collect them separately. A charge for interest may be made for sums advanced not exceeding the rate of interest permitted by division (A) of this section. Within a reasonable time after advancing a sum, the licensee shall notify the borrower in writing of the amount advanced, any interest charged with respect to the amount advanced, any revised payment schedule, and shall include a brief description of the reason for the advance.

(I) A licensee may charge and receive loan origination charges not exceeding the following:

(1) On loans in the principal amount of five hundred dollars of less, the greater of fifteen dollars or one per cent of the principal amount of the loan and, on each refinancing made more than six months after the original loan and any previous refinancing, not exceeding fifteen dollars;

(2) On all other loans, the greater of thirty dollars or one percent of the principal amount of the loan and, on each refinancing, not exceeding thirty dollars. Loan origination charges may be paid by the borrower at the time of the loan or may be included in the principal amount of the loan.

(J) A licensee may charge and receive check collection charges not greater than twenty dollars plus any amount passed on from other financial institutions for each check, negotiable order of withdrawal, share draft, or other negotiable instrument returned or dishonored for any reason.

(K) If the loan contract so provides, a licensee may collect a default charge on any installment not paid in full within ten days after its due date. For this purpose, all installments are considered paid in the order in which they become due. Any amounts applied to an outstanding loan balance as a result of voluntary release of a security interest, sale of security on the loan, or cancellation of insurance shall be considered payments on the loan, unless the parties otherwise agree in writing at the time the amounts are applied. The amount of the default charge shall not exceed the greater of five per cent of the scheduled installment or five dollars.

(L) With respect to a loan it has made under sections 1321.01 to 1321.19 of the Revised Code, a licensee may not do any of the following:

(1) Charge or receive a fee for cashing a proceeds check or money order disbursed to fund the loan;

(2) Require a borrower to cash a proceeds check or money order disbursed to fund the loan at the place of business of the licensee, an affiliate of the licensee, or any specified third party;

(3) Seek or obtain directly or indirectly compensation from any affiliate or third party that provides check-cashing services to cash a proceeds check or money order disbursed to fund the loan by the licensee.

Sec. 1321.131.  As an alternative to the interest permitted in division (A) of section 1321.13 and in division (B) of section 1321.16 of the Revised Code, a licensee may contract for and receive interest at any rate or rates agreed upon or consented to by the parties to the loan contract or open-end loan agreement, but not exceeding an annual percentage rate of twenty-five per cent.

Nothing in this section shall be construed to permit a licensee to contract for or receive an annual percentage rate that is greater than what is permitted in division (C) of section 1321.15 of the Revised Code for loans described in that division.

Sec. 1321.14. (A) Licensees under section 1321.01 of the Revised Code shall:

(A)(1) At the time any interest-bearing or precomputed loan is made, deliver to the borrower or, if there are two or more borrowers, to one of them, a statement in the English language disclosing in clear and distinct terms the amount and date of the loan, a schedule of payments or a description thereof, the type of the security, if any, for the loan, the name and address of the licensed office and of each borrower, and the agreed rate of interest, or in lieu thereof, a copy of the instrument evidencing the debt signed by the borrower;

(B)(2) For each payment made on account of any such interest-bearing or precomputed loan, give to the person making it a receipt if requested;

(C)(3) Permit payment to be made in advance in any amount on any contract of loan at any time, but the licensee may apply the payment first to all interest and charges due up to the date of the payment;

(D)(4) Upon repayment of the loan in full, mark plainly every obligation signed by any obligor, or a copy of the signed obligation, "paid" or "canceled" and return it and any pledge to the borrower or, if there are two or more borrowers, to one of them; provided that a continuing obligation in whole or in part is not repayment in full thereof.

(B) No licensee shall take any note or promise to pay in which blanks are left to be filled in after execution.

(C) Any licensee or other person who willfully violates section 1321.13 or division (C) of section 1321.15 of the Revised Code shall forfeit to the borrower twice the amount of interest contracted for. The maximum rate of interest applicable to any loan transaction that does not comply with all provisions of section 1321.13 of the Revised Code shall be the rate that would be applicable in the absence of sections 1321.01 to 1321.19 of the Revised Code.

(D) No licensee shall pledge or hypothecate any note or security given by any borrower except with a person residing or maintaining a place of business in this state or with a bank authorized to transact business in this state, under an agreement permitting the division of financial institutions to examine the papers so hypothecated.

(E) The tender by the borrower, or at the borrower's request, of an amount equal to the unpaid balance less the required rebate on a precomputed loan shall be accepted by the licensee in full payment of the loan obligation.

(F) A licensee shall not, directly or indirectly, make any payment, or cause to be made any payment, whether in cash or otherwise, to a dealer in tangible goods or services, or to a retail seller as defined in section 1317.01 of the Revised Code, in connection with the making of a loan to a customer, patron, or other person who has done, or is doing, business with the dealer in tangible goods or services, or the retail seller. This section does not prohibit bona fide advertising practices involving only the borrowers.

Sec. 1321.15.  (A) No licensee shall knowingly induce or permit any person, jointly or severally, to be obligated, directly or contingently or both, under more than one contract of loan at the same time for the purpose or with the result of obtaining a higher rate of interest or greater charges than would otherwise be permitted upon a single loan made under sections 1321.01 to 1321.19 of the Revised Code.

(B) No licensee shall charge, contract for, or receive, directly or indirectly, interest and charges greater than such licensee would be permitted to charge, contract for, or receive without a license under sections 1321.01 to 1321.19 of the Revised Code on any part of an indebtedness for one or more than one loan of money if the amount of such indebtedness is in excess of five thousand dollars.

(C)(1) No licensee shall make a loan of one thousand dollars or less under sections 1321.01 to 1321.19 of the Revised Code that will obligate the borrower to pay an annual percentage rate for the loan that exceeds twenty-eight per cent, as calculated in compliance with the "Truth in Lending Act," 82 Stat. 149 (1980), 15 U.S.C. 1606, unless one of the following applies:

(a) The term of the loan is greater than three months.

(b) The loan contract requires the borrower to repay the loan in three or more monthly installments of substantially equal amounts.

(2) Any loan made by a licensee that meets the requirements of division (C)(1)(a) or (b) of this section shall be subject to section 1321.13 of the Revised Code.

(D) For the purpose of the limitations set forth in this section, the amount of any such indebtedness shall be determined by including the entire obligation of any person to the licensee for principal, direct or contingent or both, as borrower, indorser, guarantor, surety for, or otherwise, whether incurred or subsisting under one or more than one contract of loan, except that any contract of indorsement, guaranty, or suretyship that does not obligate the indorser, guarantor, or surety for any charges in excess of eight per cent per annum, is not included in such entire obligation. If a licensee acquires, directly or indirectly, by purchase or discount, bona fide obligations for goods or services owed by the person who received such goods or services to the person who provided such goods or services, then the amount of such purchased or discounted indebtedness to the licensee shall not be included in computing the aggregate indebtedness of such borrower to the licensee for the purpose of the prohibitions set forth in this section.

Sec. 1321.44. (A) A violation of section 1321.41 section 1321.36, 1321.39, 1321.40, 1321.41, or 1321.45 of the Revised Code is deemed an unfair or deceptive act or practice in violation of section 1345.02 of the Revised Code. A borrower injured by a violation of section 1321.41 of the Revised Code shall have a cause of action and be entitled to the same relief available to a consumer under section 1345.09 of the Revised Code, and all powers and remedies available to the attorney general to enforce sections 1345.01 to 1345.13 of the Revised Code are available to the attorney general to enforce section 1321.41 of the Revised Code.

(B) The superintendent of financial institutions or a borrower may bring directly an action to enjoin a violation of sections 1321.35 to 1321.48 of the Revised Code. The prosecuting attorney of the county in which the action may be brought may bring an action to enjoin a violation of sections 1321.35 to 1321.48 of the Revised Code only if the prosecuting attorney first presents any evidence of the violation to the attorney general and, within a reasonable period of time, the attorney general has not agreed to bring the action.

(C) The superintendent may initiate criminal proceedings under sections 1321.35 to 1321.48 of the Revised Code by presenting any evidence of criminal violation to the prosecuting attorney of the county in which the offense may be prosecuted. If the prosecuting attorney does not prosecute the violations, or at the request of the prosecuting attorney, the superintendent shall present any evidence of criminal violations to the attorney general, who may proceed in the prosecution with all the rights, privileges, and powers conferred by law on prosecuting attorneys, including the power to appear before grand juries and to interrogate witnesses before such grand juries. These powers of the attorney general are in addition to any other applicable powers of the attorney general.

(D) The prosecuting attorney of the county in which an alleged offense may be prosecuted may initiate criminal proceedings under sections 1321.35 to 1321.48 of the Revised Code.

(E) In order to initiate criminal proceedings under sections 1321.35 to 1321.48 of the Revised Code, the attorney general first shall present any evidence of criminal violations to the prosecuting attorney of the county in which the alleged offense may be prosecuted. If, within a reasonable period of time, the prosecuting attorney has not agreed to prosecute the violations, the attorney general may proceed in the prosecution with all the rights, privileges, and powers described in division (B) of this section.

(F) When a judgment under this section becomes final, the clerk of court shall mail a copy of the judgment, including supporting opinions, to the superintendent may be enforced pursuant to section 1321.61 of the Revised Code.

Sec. 1321.52.  (A)(1) No person, on that person's own behalf or on behalf of any other person, shall do either of the following without having first obtained a certificate of registration from the division of financial institutions:

(a) Advertise, solicit, or hold out that the person is engaged in the business of making loans secured by a mortgage on a borrower's real estate which is other than a first lien on the real estate;

(b) Engage in the business of lending or collecting the person's own or another person's money, credit, or choses in action for such loans.

(2) Each person issued a certificate is subject to all the rules prescribed under sections 1321.51 to 1321.60 of the Revised Code.

(B) All loans made to persons who at the time are residents of this state are considered as made within this state and subject to the laws of this state, regardless of any statement in the contract or note to the contrary.

(C) A registrant may make unsecured loans, loans secured by a mortgage on a borrower's real estate which is a first lien or other than a first lien on the real estate, loans secured by other than real estate, and loans secured by any combination of mortgages and security interests, on terms and conditions provided by sections 1321.51 to 1321.60 of the Revised Code.

(D)(1) If a lender that is subject to sections 1321.51 to 1321.60 of the Revised Code makes a loan in violation of division (A)(1) of this section, the lender has no right to collect, receive, or retain any interest or charges on that loan.

(2) If a registrant applies to the division for a renewal of the registrant's certificate after the date required by division (A)(4) of section 1321.53 of the Revised Code, but prior to the first day of August of that year, and the division approves the application, division (D)(1) of this section does not apply with respect to any loan made by the registrant while the registrant's certificate was expired.

(E) No person not located in Ohio shall make a loan under sections 1321.51 to 1321.60 of the Revised Code to a borrower in Ohio from an office not located in Ohio. Nothing in this section prohibits a business not located or licensed in Ohio from lending funds to Ohio borrowers who physically visit the out-of-state office of the business and obtain the disbursement of loan funds at that location.

Sec. 1321.53.  (A)(1) An application for a certificate of registration under sections 1321.51 to 1321.60 of the Revised Code shall contain an undertaking by the applicant to abide by those sections. The application shall be in writing, under oath, and in the form prescribed by the division of financial institutions, shall give the location where the business is to be conducted and the names and addresses of the partners, officers, or trustees of the applicant, and shall contain any further relevant information that the division may require. Applicants that are foreign corporations shall obtain and maintain a license pursuant to Chapter 1703. of the Revised Code before a certificate is issued or renewed.

(2) Upon the filing of the application and the payment by the applicant of two hundred dollars as an investigation fee and an annual registration fee as determined by the superintendent of financial institutions pursuant to section 1321.20 of the Revised Code, the division shall investigate the relevant facts. If the application involves investigation outside this state, the applicant may be required by the division to advance sufficient funds to pay any of the actual expenses of such investigation, when it appears that these expenses will exceed two hundred dollars. An itemized statement of any of these expenses which the applicant is required to pay shall be furnished the applicant by the division. No certificate shall be issued unless the fees have been submitted to the division, and no registration fee or investigation fee will be returned after a certificate has been issued.

(3) If an application for a certificate of registration does not contain all of the information required under division (A)(1) of this section, and if such information is not submitted to the division within ninety days after the application is filed, the superintendent may consider the application withdrawn and may retain the investigation fee.

(4) If the division finds that the financial responsibility, experience, character, and general fitness of the applicant are such as to command the confidence of the public and to warrant the belief that the business will be operated honestly and fairly in compliance with and within the purposes of sections 1321.51 to 1321.60 of the Revised Code, and that the applicant has the net worth and assets required by division (B) of this section, the division shall thereupon issue a certificate to the applicant. The certificate shall expire on the first day of July next after its issue, and on the first day of July in each succeeding year, unless renewed by payment of an annual fee, and any assessment, as determined by the superintendent pursuant to section 1321.20 of the Revised Code, on or before the last day of June of each year. No other fee or assessment shall be required of a registrant by the state or any political subdivision of the state.

If the division does not so find, it shall enter an order denying the application, and forthwith notify the applicant of the denial, the grounds for the denial, and the applicant's reasonable opportunity to be heard on the action in accordance with Chapter 119. of the Revised Code. In the event of denial, the division shall return the registration fee but retain the investigation fee.

(5) If there is a change of ten per cent or more in the ownership of a registrant, the division may make any investigation necessary to determine whether any fact or condition exists that, if it had existed at the time of the original application for a certificate of registration, the fact or condition would have warranted the division to deny the application under division (A)(4) of this section. If such a fact or condition is found, the division may, in accordance with Chapter 119. of the Revised Code, revoke the registrant's certificate.

(B) Each registrant that engages in lending under sections 1321.51 to 1321.60 of the Revised Code shall maintain both of the following:

(1) A net worth of at least fifty thousand dollars;

(2) For each certificate of registration, assets of at least fifty thousand dollars either in use or readily available for use in the conduct of the business.

(C) Not more than one place of business shall be maintained under the same certificate, but the division may issue additional certificates to the same registrant upon compliance with sections 1321.51 to 1321.60 of the Revised Code, governing the issuance of a single certificate. No change in the place of business of a registrant to a location outside the original municipal corporation shall be permitted under the same certificate without the approval of a new application, the payment of the registration fee as determined by the superintendent pursuant to section 1321.20 of the Revised Code and, if required by the superintendent, the payment of an investigation fee of two hundred dollars. When a registrant wishes to change its place of business within the same municipal corporation, it shall give written notice of the change in advance to the division, which shall provide a certificate for the new address without cost. If a registrant changes its name, prior to making loans under the new name it shall give written notice of the change to the division, which shall provide a certificate in the new name without cost. Sections 1321.51 to 1321.60 of the Revised Code do not limit the loans of any registrant to residents of the community in which the registrant's place of business is situated. Each certificate shall be kept conspicuously posted in the place of business of the registrant and is not transferable or assignable.

(D) Sections 1321.51 to 1321.60 of the Revised Code do not apply to any of the following:

(1) Persons lawfully doing business under the authority of any law of this state, another state, or the United States relating to banks, savings banks, trust companies, savings and loan associations, or credit unions;

(2) Life, property, or casualty insurance companies licensed to do business in this state;

(3) Any person that is a lender making a loan pursuant to sections 1321.01 to 1321.19 of the Revised Code or a business loan as described in division (B)(6)(5) of section 1343.01 of the Revised Code;

(4) Any governmental agency or instrumentality, or any entity included under division (B)(3) of section 1343.01 of the Revised Code.

(E) No person engaged in the business of selling tangible goods or services related to tangible goods may receive or retain a certificate under sections 1321.51 to 1321.60 of the Revised Code for such place of business.

Sec. 1321.542.  A violation of section 1321.52, 1321.551, 1321.56, 1321.57, 1321.571, 1321.59, 1321.591, or 1321.60 of the Revised Code may be enforced pursuant to section 1321.61 of the Revised Code when the violation involves a loan of one thousand dollars or less.

Sec. 1321.551.  No registrant shall conduct the business of making loans under sections 1321.51 to 1321.60 of the Revised Code in any office, room, or place of business in which any other business is solicited or engaged in, or in association or conjunction with any other such business, if the superintendent of financial institutions finds, pursuant to a hearing conducted in accordance with Chapter 119. of the Revised Code, that the other business is of such a nature that the conduct tends to conceal evasion of sections 1321.51 to 1321.60 of the Revised Code or of the rules adopted under those sections, and orders the registrant in writing to desist from the conduct. For purposes of this section, "other business" includes any business conducted by a person who is registered or is required to be registered as a credit services organization under section 4712.02 of the Revised Code, licensed as a check-cashing business under section 1315.22 of the Revised Code, engaged in the practice of debt adjusting pursuant to Chapter 4710. of the Revised Code, or is a lessor as defined in section 1351.01 of the Revised Code.

Sec. 1321.56.  Any person who willfully violates section 1321.57 or division (E) of section 1321.59 of the Revised Code shall forfeit to the borrower the amount of interest paid by the borrower. The maximum rate of interest applicable to any loan transaction that does not comply with section 1321.57 of the Revised Code shall be the rate that would be applicable in the absence of sections 1321.51 to 1321.60 of the Revised Code.

Sec. 1321.57.  (A) Notwithstanding any other provisions of the Revised Code other than division (E) of section 1321.59 of the Revised Code, a registrant may contract for and receive interest, calculated according to the actuarial method, at a rate or rates not exceeding twenty-one per cent per year on the unpaid principal balances of the loan. Loans may be interest-bearing or precomputed.

(B) For purposes of computation of time on interest-bearing and precomputed loans, including, but not limited to, the calculation of interest, a month is considered one-twelfth of a year, and a day is considered one three hundred sixty-fifth of a year when calculation is made for a fraction of a month. A year is as defined in section 1.44 of the Revised Code. A month is that period described in section 1.45 of the Revised Code. Alternatively, a registrant may consider a day as one three hundred sixtieth of a year and each month as having thirty days.

(C) With respect to interest-bearing loans:

(1)(a) Interest shall be computed on unpaid principal balances outstanding from time to time, for the time outstanding.

(b) As an alternative to the method of computing interest set forth in division (C)(1)(a) of this section, a registrant may charge and collect interest for the first installment period based on elapsed time from the date of the loan to the first scheduled payment due date, and for each succeeding installment period from the scheduled payment due date to the next scheduled payment due date, regardless of the date or dates the payments are actually made.

(c) Whether a registrant computes interest pursuant to division (C)(1)(a) or (b) of this section, each payment shall be applied first to unpaid charges, then to interest, and the remainder to the unpaid principal balance. However, if the amount of the payment is insufficient to pay the accumulated interest, the unpaid interest continues to accumulate to be paid from the proceeds of subsequent payments and is not added to the principal balance.

(2) Interest shall not be compounded, collected, or paid in advance. However, both of the following apply:

(a) Interest may be charged to extend the first monthly installment period by not more than fifteen days, and the interest charged for the extension may be added to the principal amount of the loan.

(b) If part or all of the consideration for a new loan contract is the unpaid principal balance of a prior loan, the principal amount payable under the new loan contract may include any unpaid interest that has accrued. The resulting loan contract shall be deemed a new and separate loan transaction for purposes of this section. The unpaid principal balance of a precomputed loan is the balance due after refund or credit of unearned interest as provided in division (D)(3) of this section.

(D) With respect to precomputed loans:

(1) Loans shall be repayable in monthly installments of principal and interest combined, except that the first installment period may exceed one month by not more than fifteen days, and the first installment payment amount may be larger than the remaining payments by the amount of interest charged for the extra days; and provided further that monthly installment payment dates may be omitted to accommodate borrowers with seasonal income.

(2) Payments may be applied to the combined total of principal and precomputed interest until maturity of the loan. A registrant may charge interest after the original or deferred maturity of a precomputed loan at the rate specified in division (A) of this section on all unpaid principal balances for the time outstanding.

(3) When any loan contract is paid in full by cash, renewal, refinancing, or a new loan, one month or more before the final installment due date, the registrant shall refund, or credit the borrower with, the total of the applicable charges for all fully unexpired installment periods, as originally scheduled or as deferred, that follow the day of prepayment. If the prepayment is made other than on a scheduled installment due date, the nearest scheduled installment due date shall be used in such computation. If the prepayment occurs prior to the first installment due date, the registrant may retain one-thirtieth of the applicable charge for a first installment period of one month for each day from date of loan to date of prepayment, and shall refund, or credit the borrower with, the balance of the total interest contracted for. If the maturity of the loan is accelerated for any reason and judgment is entered, the registrant shall credit the borrower with the same refund as if prepayment in full had been made on the date the judgment is entered.

(4) If the parties agree in writing, either in the loan contract or in a subsequent agreement, to a deferment of wholly unpaid installments, a registrant may grant a deferment and may collect a deferment charge as provided in this section. A deferment postpones the scheduled due date of the earliest unpaid installment and all subsequent installments as originally scheduled, or as previously deferred, for a period equal to the deferment period. The deferment period is that period during which no installment is scheduled to be paid by reason of the deferment. The deferment charge for a one-month period may not exceed the applicable charge for the installment period immediately following the due date of the last undeferred installment. A proportionate charge may be made for deferment for periods of more or less than one month. A deferment charge is earned pro rata during the deferment period and is fully earned on the last day of the deferment period. If a loan is prepaid in full during a deferment period, the registrant shall make, or credit to the borrower, a refund of the unearned deferment charge in addition to any other refund or credit made for prepayment of the loan in full.

(E) A registrant, at the request of the borrower, may obtain, on one or more borrowers, credit life insurance, credit accident and health insurance, and unemployment insurance. The premium or identifiable charge for the insurance may be included in the principal amount of the loan and may not exceed the premium rate filed by the insurer with the superintendent of insurance and not disapproved by the superintendent. If a registrant obtains the insurance at the request of the borrower, the borrower shall have the right to cancel the insurance for a period of twenty-five days after the loan is made. If the borrower chooses to cancel the insurance, the borrower shall give the registrant written notice of this choice and shall return all of the policies or certificates of insurance or notices of proposed insurance to the registrant during such period, and the full premium or identifiable charge for the insurance shall be refunded to the borrower by the registrant. If the borrower requests, in the notice to cancel the insurance, that this refund be applied to reduce the balance of a precomputed loan, the registrant shall credit the amount of the refund plus the amount of interest applicable to the refund to the loan balance.

If the registrant obtains the insurance at the request of the borrower, the registrant shall not charge or collect interest on any insured amount that remains unpaid after the insured borrower's date of death.

(F) A registrant may require the borrower to provide insurance or a loss payable endorsement covering reasonable risks of loss, damage, and destruction of property used as security for the loan and with the consent of the borrower such insurance may cover property other than that which is security for the loan. The amount and term of required property insurance shall be reasonable in relation to the amount and term of the loan contract and the type and value of the security, and the insurance shall be procured in accordance with the insurance laws of this state. The purchase of this insurance through the registrant or an agent or broker designated by the registrant shall not be a condition precedent to the granting of the loan. If the borrower purchases the insurance from or through the registrant or from another source, the premium may be included in the principal amount of the loan.

(G) On loans secured by an interest in real estate, all of the following apply:

(1) A registrant may charge and receive up to two points, and a prepayment penalty not in excess of one per cent of the original principal amount of the loan. Points may be paid by the borrower at the time of the loan or may be included in the principal amount of the loan. On a refinancing, a registrant may not charge under division (G)(1) of this section either of the following:

(a) Points on the portion of the principal amount that is applied to the unpaid principal amount of the refinanced loan, if the refinancing occurs within one year after the date of the refinanced loan on which points were charged;

(b) A prepayment penalty.

(2) As an alternative to the prepayment penalty described in division (G)(1) of this section, a registrant may contract for, charge, and receive the prepayment penalty described in division (G)(2) of this section for the prepayment of a loan prior to two years after the date the loan contract is executed. This prepayment penalty shall not exceed two per cent of the original principal amount of the loan if the loan is paid in full prior to one year after the date the loan contract is executed. The penalty shall not exceed one per cent of the original principal amount of the loan if the loan is paid in full at any time from one year, but prior to two years, after the date the loan contract is executed. A registrant shall not charge or receive a prepayment penalty under division (G)(2) of this section if any of the following applies:

(a) The loan is a refinancing by the same registrant or a registrant to whom the loan has been assigned;

(b) The loan is paid in full as a result of the sale of the real estate that secures the loan;

(c) The loan is paid in full with the proceeds of an insurance claim against an insurance policy that insures the life of the borrower or an insurance policy that covers loss, damage, or destruction of the real estate that secures the loan.

(3) Division (G) of this section is not a limitation on discount points or other charges for purposes of section 501(b)(4) of the "Depository Institutions Deregulation and Monetary Control Act of 1980," 94 Stat. 161, 12 U.S.C.A. 1735f-7 note.

(H)(1) In addition to the interest and charges provided for by this section, no further or other amount, whether in the form of broker fees, placement fees, or any other fees whatsoever, shall be charged or, received, or required by the registrant, except costs and disbursements in connection with any suit to collect a loan or any lawful activity to realize on a security interest or mortgage after default, including reasonable attorney fees incurred by the registrant as a result of the suit or activity and to which the registrant becomes entitled by law, and except the following additional charges which may be included in the principal amount of the loan or collected at any time after the loan is made:

(a) The amounts of fees authorized by law to record, file, or release security interests and mortgages on a loan;

(b) With respect to a loan secured by an interest in real estate, the following closing costs, if they are bona fide, reasonable in amount, and not for the purpose of circumvention or evasion of this section:

(i) Fees or premiums for title examination, abstract of title, title insurance, surveys, title endorsements, title binders, title commitments, home inspections, or pest inspections; settlement or closing costs; courier fees; and any federally mandated flood plain certification fee;

(ii) If not paid to the registrant, an employee of the registrant, or a person related to the registrant, fees for preparation of a mortgage, settlement statement, or other documents, fees for notarizing mortgages and other documents, appraisal fees, and fees for any federally mandated inspection of home improvement work financed by a second mortgage loan;

(c) Fees for credit investigations not exceeding ten dollars.

(2) Division (H)(1) of this section does not limit the rights of registrants to engage in other transactions with borrowers, provided the transactions are not a condition of the loan.

(I) If the loan contract or security instrument contains covenants by the borrower to perform certain duties pertaining to insuring or preserving security and the registrant pursuant to the loan contract or security instrument pays for performance of the duties on behalf of the borrower, the registrant may add the amounts paid to the unpaid principal balance of the loan or collect them separately. A charge for interest may be made for sums advanced not exceeding the rate of interest permitted by division (A) of this section. Within a reasonable time after advancing a sum, the registrant shall notify the borrower in writing of the amount advanced, any interest charged with respect to the amount advanced, any revised payment schedule, and shall include a brief description of the reason for the advance.

(J)(1) In addition to points authorized under division (G) of this section, a registrant may charge and receive the following:

(a) With respect to secured loans: if the principal amount of the loan is less than five hundred dollars, loan origination charges not exceeding fifteen dollars; if the principal amount of the loan is at least five hundred dollars but less than one thousand dollars, loan origination charges not exceeding thirty dollars; if the principal amount of the loan is at least one thousand dollars but less than two thousand dollars, loan origination charges not exceeding one hundred dollars; if the principal amount of the loan is at least two thousand dollars but less than five thousand dollars, loan origination charges not exceeding two hundred dollars; and if the principal amount of the loan is at least five thousand dollars, loan origination charges not exceeding the greater of two hundred fifty dollars or one per cent of the principal amount of the loan.

(b) With respect to unsecured loans: if the principal amount of the loan is less than five hundred dollars, loan origination charges not exceeding fifteen dollars; if the principal amount of the loan is at least five hundred dollars but less than one thousand dollars, loan origination charges not exceeding thirty dollars; if the principal amount of the loan is at least one thousand dollars but less than five thousand dollars, loan origination charges not exceeding one hundred dollars; and if the principal amount of the loan is at least five thousand dollars, loan origination charges not exceeding the greater of two hundred fifty dollars or one per cent of the principal amount of the loan.

(2) If a refinancing occurs within ninety days after the date of the refinanced loan, a registrant may not impose loan origination charges on the portion of the principal amount that is applied to the unpaid principal amount of the refinanced loan.

(3) Loan origination charges may be paid by the borrower at the time of the loan or may be included in the principal amount of the loan.

(K) A registrant may charge and receive check collection charges not greater than twenty dollars plus any amount passed on from other financial institutions for each check, negotiable order of withdrawal, share draft, or other negotiable instrument returned or dishonored for any reason.

(L) If the loan contract so provides, a registrant may collect a default charge on any installment not paid in full within ten days after its due date. For this purpose, all installments are considered paid in the order in which they become due. Any amounts applied to an outstanding loan balance as a result of voluntary release of a security interest, sale of security on the loan, or cancellation of insurance shall be considered payments on the loan, unless the parties otherwise agree in writing at the time the amounts are applied. The amount of the default charge shall not exceed the greater of five per cent of the scheduled installment or fifteen dollars.

(M) With respect to a loan it has made under sections 1321.51 to 1321.60 of the Revised Code, a registrant may not do any of the following:

(1) Charge or receive a fee for cashing a proceeds check or money order disbursed to fund the loan;

(2) Require a borrower to cash a proceeds check or money order disbursed to fund the loan at the place of business of the registrant, an affiliate of the registrant, or any specified third party;

(3) Seek or obtain directly or indirectly compensation from any affiliate or third party that provides check-cashing services to cash a proceeds check or money order disbursed to fund the loan by the registrant.

Sec. 1321.571.  As an alternative to the interest permitted in division (A) of section 1321.57 and in division (B) of section 1321.58 of the Revised Code, a registrant may contract for and receive interest at any rate or rates agreed upon or consented to by the parties to the loan contract or open-end loan agreement, but not exceeding an annual percentage rate of twenty-five per cent.

Nothing in this section shall be construed to permit a licensee to contract for or receive an annual percentage rate that is greater than what is permitted in division (E) of section 1321.59 of the Revised Code for loans described in that division.

Sec. 1321.59.  (A) No registrant under sections 1321.51 to 1321.60 of the Revised Code shall permit any borrower to be indebted for a loan made under sections 1321.51 to 1321.60 of the Revised Code at any time while the borrower is also indebted to an affiliate or agent of the registrant for a loan made under sections 1321.01 to 1321.19 of the Revised Code for the purpose or with the result of obtaining greater charges than otherwise would be permitted by sections 1321.51 to 1321.60 of the Revised Code.

(B) No registrant shall induce or permit any person to become obligated to the registrant under sections 1321.51 to 1321.60 of the Revised Code, directly or contingently, or both, under more than one contract of loan at the same time for the purpose or with the result of obtaining greater charges than would otherwise be permitted by sections 1321.51 to 1321.60 of the Revised Code.

(C) No registrant shall refuse to provide information regarding the amount required to pay in full a loan under sections 1321.51 to 1321.60 of the Revised Code when requested by the borrower or by another person designated in writing by the borrower.

(D) On any loan or application for a loan under sections 1321.51 to 1321.60 of the Revised Code secured by a mortgage on a borrower's real estate which is other than a first lien on the real estate, no person shall pay or receive, directly or indirectly, fees or any other type of compensation for services of a broker that, in the aggregate, exceed the lesser of one thousand dollars or one per cent of the principal amount of the loan.

(E)(1) No registrant shall make a loan of one thousand dollars or less under sections 1321.51 to 1321.60 of the Revised Code that will obligate the borrower to pay an annual percentage rate for the loan that exceeds twenty-eight per cent, as calculated in compliance with the "Truth in Lending Act," 82 Stat. 149 (1980), 15 U.S.C. 1606, unless one of the following applies:

(a) The term of loan is greater than three months.

(b) The loan contract requires the borrower to repay the loan in three or more monthly installments of substantially equal amounts.

(2) Any loan made by a registrant that meets the requirements of division (E)(1)(a) or (b) of this section shall be subject to section 1321.57 of the Revised Code.

Sec. 1321.591. No registrant or licensee shall use unfair, deceptive, or unconscionable means to collect or attempt to collect any claim. Without limiting the general application of the foregoing, the following conduct is deemed to violate this section:

(A) The collection of or the attempt to collect any interest or other charge, fee, or expense incidental to the principal obligation unless such interest or incidental fee, charge, or expense is expressly authorized by the agreement creating the obligation and by law.

(B) Any communication with a consumer whenever it is known that the consumer is represented by an attorney and the attorney's name and address are known, or could be easily ascertained, unless the attorney fails to answer correspondence, return telephone calls or discuss the obligation in question, or unless the attorney consents to direct communication with the consumer.

(C) Placing a telephone call or otherwise communicating by telephone with a consumer or third party, at any place, including a place of employment, falsely stating that the call is urgent or an emergency.

(D) Using profane or obscene language or language that is intended to unreasonably abuse the listener or reader.

(E) Placing telephone calls without disclosure of the caller's identity and with the intent to annoy, harass, or threaten any person at the number called.

(F) Causing expense to any person in the form of long distance telephone tolls, text messaging fees, or other charges incurred by a form of communication, by concealment of the true purpose of the communication.

(G) Causing a telephone to ring or engaging any person in telephone conversation repeatedly or continuously, or at unusual times, or at times known to be inconvenient, with the intent to annoy, abuse, oppress, or threaten any person at the called number.

Sec. 1321.61. (A) As used in this section, "violation" means either of the following:

(1) A violation of section 1321.02, 1321.11, 1321.12, 1321.13, 1321.14, 1321.15, 1321.17, 1321.52, 1321.551, 1321.56, 1321.57, 1321.571, 1321.59, 1321.591, or 1321.60 of the Revised Code when the violation involves a loan of one thousand dollars or less;

(2) A violation of section 1321.36, 1321.39, 1321.40, 1321.41, or 1321.45 of the Revised Code.

(B) A violation is deemed an unfair or deceptive act or practice that violates section 1345.02 of the Revised Code. A borrower injured by a violation shall have a cause of action and be entitled to the same relief available to a consumer under section 1345.09 of the Revised Code, and all powers and remedies available to the attorney general to enforce sections 1345.01 to 1345.13 of the Revised Code are available to the attorney general to take enforcement action regarding a violation.

(C) The superintendent of financial institutions or a borrower may bring directly an action to enjoin a violation. The prosecuting attorney of the county in which the action may be brought may bring an action to enjoin a violation only if the prosecuting attorney first presents any evidence of the violation to the attorney general and, within a reasonable period of time, the attorney general has not agreed to bring the action.

(D) The superintendent may initiate criminal proceedings for a violation by presenting any evidence of a criminal offense to the prosecuting attorney of the county in which the offense may be prosecuted. If the prosecuting attorney does not prosecute the violation, or at the request of the prosecuting attorney, the superintendent shall present any evidence of criminal offenses to the attorney general, who may proceed in the prosecution with all the rights, privileges, and powers conferred by law on prosecuting attorneys, including the power to appear before grand juries and to interrogate witnesses before such grand juries. These powers of the attorney general are in addition to any other applicable powers of the attorney general.

(E) The prosecuting attorney of the county in which an alleged offense may be prosecuted may initiate criminal proceedings for a violation.

(F) In order to initiate criminal proceedings for a violation, the attorney general first shall present any evidence of a criminal offense to the prosecuting attorney of the county in which the alleged offense may be prosecuted. If, within a reasonable period of time, the prosecuting attorney has not agreed to prosecute the violation, the attorney general may proceed in the prosecution with all the rights, privileges, and powers described in division (C) of this section.

(G) When a judgment under this section becomes final, the clerk of court shall mail a copy of the judgment, including supporting opinions, to the superintendent.

Sec. 1321.99.  (A) Whoever violates section 1321.02 of the Revised Code is guilty of a felony of the fifth degree.

(B) Whoever violates section 1321.13 of the Revised Code shall be fined not less than one hundred nor more than five hundred dollars or imprisoned not more than six months, or both.

(C) Whoever violates section 1321.14 of the Revised Code shall be fined not less than fifty nor more than two hundred dollars for a first offense; for a second offense such person shall be fined not less than two hundred nor more than five hundred dollars and imprisoned for not more than six months.

(D) Whoever willfully violates division (C) of section 1321.15 or section 1321.57, 1321.58, 1321.59, or 1321.60 of the Revised Code shall be fined not less than one five hundred nor more than five hundred one thousand dollars.

(E) Whoever violates section 1321.52 of the Revised Code is guilty of a felony of the fifth degree.

(F) Whoever violates division (A) of section 1321.73 of the Revised Code shall be fined not more than five hundred dollars or imprisoned not more than six months, or both.

(G) Whoever violates section 1321.41 of the Revised Code is guilty of a misdemeanor of the first degree.

Sec. 1322.01.  As used in sections 1322.01 to 1322.12 of the Revised Code:

(A) "Buyer" means an individual who is solicited to purchase or who purchases the services of a mortgage broker for purposes other than obtaining a business loan as described in division (B)(6)(5) of section 1343.01 of the Revised Code.

(B) "Consumer reporting agency" has the same meaning as in the "Fair Credit Reporting Act," 84 Stat. 1128, 15 U.S.C.A. 1681a, as amended.

(C) "Employee" means an individual for whom a mortgage broker, in addition to providing a wage or salary, pays social security and unemployment taxes, provides workers' compensation coverage, and withholds local, state, and federal income taxes. "Employee" also includes any shareholder, member, or partner of a registrant who acts as a loan officer or operations manager of the registrant, but for whom the registrant is prevented by law from making income tax withholdings.

(D) "Licensee" means any person that has been issued a loan officer license under sections 1322.01 to 1322.12 of the Revised Code.

(E) "Loan officer" means an employee who originates mortgage loans in consideration of direct or indirect gain, profit, fees, or charges. "Loan officer" also includes an employee who solicits financial and mortgage information from the public for sale to another mortgage broker.

(F) "Mortgage" means any indebtedness secured by a deed of trust, security deed, or other lien on real property.

(G) "Mortgage broker" means any of the following:

(1) A person that holds that person out as being able to assist a buyer in obtaining a mortgage and charges or receives from either the buyer or lender money or other valuable consideration readily convertible into money for providing this assistance;

(2) A person that solicits financial and mortgage information from the public, provides that information to a mortgage broker, and charges or receives from the mortgage broker money or other valuable consideration readily convertible into money for providing the information;

(3) A person engaged in table-funding or warehouse-lending mortgage loans that are first lien mortgage loans.

(H) "Operations manager" means the individual responsible for the everyday operations, compliance requirements, and management of a mortgage broker business.

(I) "Originate" means to do any of the following:

(1) Negotiate or arrange, or offer to negotiate or arrange, a mortgage loan between a person that makes or funds mortgage loans and a buyer;

(2) Issue a commitment for a mortgage loan to a buyer;

(3) Place, assist in placement, or find a mortgage loan for a buyer.

(J) "Registrant" means any person that has been issued a mortgage broker certificate of registration under sections 1322.01 to 1322.12 of the Revised Code.

(K) "Superintendent of financial institutions" includes the deputy superintendent for consumer finance as provided in section 1181.21 of the Revised Code.

(L) "Table-funding mortgage loan" means a mortgage loan transaction in which the mortgage is initially payable to the mortgage broker, the mortgage broker does not use the mortgage broker's own funds to fund the transaction, and, by the terms of the mortgage or other agreement, the mortgage is simultaneously assigned to another person.

(M) "Warehouse-lending mortgage loan" means a mortgage loan transaction in which the mortgage is initially payable to the mortgage broker, the mortgage broker uses the mortgage broker's own funds to fund the transaction, and the mortgage is sold or assigned before the mortgage broker receives a scheduled payment on the mortgage.

Sec. 1343.01.  (A) The parties to a bond, bill, promissory note, or other instrument of writing for the forbearance or payment of money at any future time, may stipulate therein for the payment of interest upon the amount thereof at any rate not exceeding eight per cent per annum payable annually, except as authorized in division (B) of this section.

(B) Any party may agree to pay a rate of interest in excess of the maximum rate provided in division (A) of this section when:

(1) The original amount of the principal indebtedness stipulated in the bond, bill, promissory note, or other instrument of writing exceeds one hundred thousand dollars;

(2) The payment is to a broker or dealer registered under the "Securities Exchange Act of 1934," 48 Stat. 881, 15 U.S.C. 78A, as amended, for carrying a debit balance in an account for a customer if such debit balance is payable on demand and secured by stocks, bonds or other securities;

(3) The instrument evidences a loan secured by a mortgage or deed of trust on real estate where the loan has been approved, insured, guaranteed, purchased, or for which an offer or commitment to insure, guarantee, or purchase has been received, in whole or in part, by the federal government or any agency or instrumentality thereof, the federal national mortgage association, the federal home loan mortgage corporation, or the farmers home administration, all of which is authorized pursuant to the "National Housing Act," 12. U.S.C. 1701; the "Serviceman's Readjustment Act," 38 U.S.C. 1801; the "Federal Home Loan Bank Act," 12 U.S.C. 1421; and the "Rural Housing Act," 42 U.S.C. 1471, amendments thereto, reenactments thereof, enactments parallel thereto, or in substitution therefor, or regulations issued thereunder; or by the state or any agency or instrumentality thereof authorized pursuant to Chapter 122. of the Revised Code, or rules issued thereunder.

(4) The instrument evidences a loan secured by a mortgage, deed of trust, or land installment contract on real estate which does not otherwise qualify for exemption from the provisions of this section, except that such rate of interest shall not exceed eight per cent in excess of the discount rate on ninety-day commercial paper in effect at the federal reserve bank in the fourth federal reserve district at the time the mortgage, deed of trust, or land installment contract is executed.

(5) The instrument is payable on demand or in one installment and is not secured by household furnishings or other goods used for personal, family, or household purposes.

(6)(a) The loan is a business loan to a business association or partnership, a person owning and operating a business as a sole proprietor; any persons owning and operating a business as joint venturers, joint tenants, or tenants in common; any limited partnership; or any trustee owning or operating a business or whose beneficiaries own or operate a business, except that:

(i) Any loan which is secured by an assignment of an individual obligor's salary, wages, commissions, or other compensation for services or by his the individual obligor's household furniture or other goods used for his the individual obligor's personal, family, or household purposes shall be deemed not a loan within the meaning of division (B)(6)(5) of this section;

(ii) Any loan which otherwise qualifies as a business loan within the meaning of division (B)(6)(5) of this section shall not be deemed disqualified because of the inclusion, with other security consisting of business assets of any such obligor, of real estate occupied by an individual obligor solely as his the individual obligor's residence.

(b) As used in division (B)(6)(5)(a) of this section, "business" means a commercial, agricultural, or industrial enterprise which is carried on for the purpose of investment or profit. "Business" does not mean the ownership or maintenance of real estate occupied by an individual obligor solely as his the individual obligor's residence.

Sec. 1345.01.  As used in sections 1345.01 to 1345.13 of the Revised Code:

(A) "Consumer transaction" means a sale, lease, assignment, award by chance, or other transfer of an item of goods, a service, a franchise, or an intangible, to an individual for purposes that are primarily personal, family, or household, or solicitation to supply any of these things. "Consumer transaction" does not include transactions between persons, defined in sections 4905.03 and 5725.01 of the Revised Code, and their customers, except for transactions involving a loan made pursuant to sections 1321.35 to 1321.48 of the Revised Code, transactions involving a loan of one thousand dollars or less made pursuant to sections 1321.01 to 1321.19 or 1321.51 to 1321.60 of the Revised Code, and transactions in connection with residential mortgages between loan officers, mortgage brokers, or nonbank mortgage lenders and their customers;. "Consumer transaction" does not include transactions between certified public accountants or public accountants and their clients; transactions between attorneys, physicians, or dentists and their clients or patients; and transactions between veterinarians and their patients that pertain to medical treatment but not ancillary services.

(B) "Person" includes an individual, corporation, government, governmental subdivision or agency, business trust, estate, trust, partnership, association, cooperative, or other legal entity.

(C) "Supplier" means a seller, lessor, assignor, franchisor, or other person engaged in the business of effecting or soliciting consumer transactions, whether or not the person deals directly with the consumer. If the consumer transaction is in connection with a residential mortgage, "supplier" does not include an assignee or purchaser of the loan for value, except as otherwise provided in section 1345.091 of the Revised Code. For purposes of this division, in a consumer transaction in connection with a residential mortgage, "seller" means a loan officer, mortgage broker, or nonbank mortgage lender.

(D) "Consumer" means a person who engages in a consumer transaction with a supplier.

(E) "Knowledge" means actual awareness, but such actual awareness may be inferred where objective manifestations indicate that the individual involved acted with such awareness.

(F) "Natural gas service" means the sale of natural gas, exclusive of any distribution or ancillary service.

(G) "Public telecommunications service" means the transmission by electromagnetic or other means, other than by a telephone company as defined in section 4927.01 of the Revised Code, of signs, signals, writings, images, sounds, messages, or data originating in this state regardless of actual call routing. "Public telecommunications service" excludes a system, including its construction, maintenance, or operation, for the provision of telecommunications service, or any portion of such service, by any entity for the sole and exclusive use of that entity, its parent, a subsidiary, or an affiliated entity, and not for resale, directly or indirectly; the provision of terminal equipment used to originate telecommunications service; broadcast transmission by radio, television, or satellite broadcast stations regulated by the federal government; or cable television service.

(H) "Loan officer" has the same meaning as in section 1322.01 of the Revised Code, except that it does not include an employee of a bank, savings bank, savings and loan association, credit union, or credit union service organization organized under the laws of this state, another state, or the United States; an employee of a subsidiary of such a bank, savings bank, savings and loan association, or credit union; or an employee of an affiliate that (1) controls, is controlled by, or is under common control with, such a bank, savings bank, savings and loan association, or credit union and (2) is subject to examination, supervision, and regulation, including with respect to the affiliate's compliance with applicable consumer protection requirements, by the board of governors of the federal reserve system, the comptroller of the currency, the office of thrift supervision, the federal deposit insurance corporation, or the national credit union administration.

(I) "Residential mortgage" or "mortgage" means an obligation to pay a sum of money evidenced by a note and secured by a lien upon real property located within this state containing two or fewer residential units or on which two or fewer residential units are to be constructed and includes such an obligation on a residential condominium or cooperative unit.

(J) "Mortgage broker" has the same meaning as in section 1322.01 of the Revised Code, except that it does not include a bank, savings bank, savings and loan association, credit union, or credit union service organization organized under the laws of this state, another state, or the United States; a subsidiary of such a bank, savings bank, savings and loan association, or credit union; an affiliate that (1) controls, is controlled by, or is under common control with, such a bank, savings bank, savings and loan association, or credit union and (2) is subject to examination, supervision, and regulation, including with respect to the affiliate's compliance with applicable consumer protection requirements, by the board of governors of the federal reserve system, the comptroller of the currency, the office of thrift supervision, the federal deposit insurance corporation, or the national credit union administration; or an employee of any such entity.

(K) "Nonbank mortgage lender" means any person that engages in a consumer transaction in connection with a residential mortgage, except for a bank, savings bank, savings and loan association, credit union, or credit union service organization organized under the laws of this state, another state, or the United States; a subsidiary of such a bank, savings bank, savings and loan association, or credit union; or an affiliate that (1) controls, is controlled by, or is under common control with, such a bank, savings bank, savings and loan association, or credit union and (2) is subject to examination, supervision, and regulation, including with respect to the affiliate's compliance with applicable consumer protection requirements, by the board of governors of the federal reserve system, the comptroller of the currency, the office of thrift supervision, the federal deposit insurance corporation, or the national credit union administration.

(L) For purposes of divisions (H), (J), and (K) of this section:

(1) "Control" of another entity means ownership, control, or power to vote twenty-five per cent or more of the outstanding shares of any class of voting securities of the other entity, directly or indirectly or acting through one or more other persons.

(2) "Credit union service organization" means a CUSO as defined in 12 C.F.R. 702.2.

Sec. 1351.031. No lessor shall engage, directly or indirectly, in any fraudulent or deceptive act, practice, or course of business in connection with a lease-purchase agreement, including knowingly acting in or abetting a scheme to create an evasion of restrictions on fees or charges as set forth in Chapter 1321. of the Revised Code.

Sec. 4710.02.  (A) Subject to division (C) of this section, a person engaged in debt adjusting shall do all of the following:

(1) Unless specifically instructed otherwise by a debtor, disburse to the appropriate creditors all funds received from the debtor, less any contributions not prohibited by division (B) of this section, within thirty days of receipt of the funds from the debtor;

(2) Maintain a separate trust account for the receipt of any funds from debtors and the disbursement of the funds to creditors on behalf of the debtors;

(3) Charge or accept only reasonable fees or contributions in accordance with division (B) of this section;

(4) Establish and implement a policy that allows for the waiver or discontinuation of fees or contributions not prohibited by division (B) of this section if the debtor is unable to pay such fees or contributions.

(B) If fees or contributions for providing debt adjusting services are charged or accepted, directly or indirectly, no person providing or engaged in debt adjusting shall do any of the following:

(1) Charge or accept a fee or contribution exceeding seventy-five dollars from a debtor residing in this state for an initial consultation or initial set up of a debt management plan or similar plan;

(2) Charge or accept consultation fees or contributions exceeding one hundred dollars per calendar year from a debtor residing in this state;

(3) Charge or accept a periodic fee or contribution from a debtor residing in this state for administering a debt management plan or similar plan, which fee or contribution exceeds eight and one-half per cent of the amount paid by the debtor each month for distribution to the debtor's creditors or thirty dollars, whichever is greater.

(4) Engage, directly or indirectly, in any fraudulent or deceptive act, practice, or course of business in connection with the offer, sale or provision of debt adjusting services, including, but not limited to, knowingly acting in or abetting a scheme to create an evasion of restrictions on fees or charges as set forth in Chapter 1321. of the Revised Code.

(C) Division (A) or (B) of this section does not prohibit a person engaged in debt adjusting for a debtor who is residing in this state from charging the debtor a reasonable fee for insufficient funds transactions that is in addition to fees or contributions not prohibited by division (B) of this section.

(D) Any person that engages in debt adjusting, annually, shall arrange for and undergo an audit conducted by an independent, third party, certified public accountant of the person's business, including any trust funds deposited and distributed to creditors on behalf of debtors. Both of the following apply to an audit described in this division:

(1) The person shall file the results of the audit and the auditor's opinion with the consumer protection division of the attorney general.

(2) The attorney general shall make available a summary of the results of the audit and the auditor's opinion upon written request of a person and payment of a fee not exceeding the cost of copying the summary and opinion.

(E) A person engaged in debt adjusting shall obtain and maintain at all times insurance coverage for employee dishonesty, depositor's forgery, and computer fraud in the amount of ten per cent of the monthly average for the immediate preceding six months of the aggregate amount of all deposits made with the person by all debtors. The insurance coverage shall comply with all of the following:

(1) The insurance coverage is not less than one hundred thousand dollars.

(2) The insurance coverage includes a deductible that does not exceed ten per cent of the face amount of the policy coverage.

(3) The insurance coverage is issued by an insurer rated at least A- or its equivalent by a nationally recognized rating organization.

(4) The insurance coverage provides that thirty days advance written notice be given to the consumer protection division of the attorney general before coverage is terminated.

(F)(1) No person engaged in debt adjusting shall fail to comply with division (A) of this section or shall violate division (B) of this section.

(2) No person engaged in debt adjusting shall fail to comply with divisions (D) and (E) of this section.

Sec. 4712.01.  As used in sections 4712.01 to 4712.14 of the Revised Code:

(A) "Buyer" means an individual who is solicited to purchase or who purchases the services of a credit services organization for purposes other than obtaining a business loan as described in division (B)(6)(5) of section 1343.01 of the Revised Code.

(B) "Consumer reporting agency" has the same meaning as in the "Fair Credit Reporting Act," 84 Stat. 1128, 15 U.S.C.A. 1681a, as amended.

(C)(1) "Credit services organization" means any person that, in return for the payment of money or other valuable consideration readily convertible into money for the following services, sells, provides, or performs, or represents that the person can or will sell, provide, or perform, one or more of the following services:

(a) Improving a buyer's credit record, history, or rating;

(b) Obtaining an extension of credit by others for a buyer;

(c) Providing advice or assistance to a buyer in connection with division (C)(1)(a) or (b) of this section;

(d) Removing adverse credit information that is accurate and not obsolete from the buyer's credit record, history, or rating;

(e) Altering the buyer's identification to prevent the display of the buyer's credit record, history, or rating.

(2) "Credit services organization" does not include any of the following:

(a) A person that makes or collects loans, to the extent these activities are subject to licensure or registration by this state;

(b) A mortgage broker, as defined in section 1322.01 of the Revised Code, that holds a valid certificate of registration under sections 1322.01 to 1322.12 of the Revised Code;

(c) A lender approved by the United States secretary of housing and urban development for participation in a mortgage insurance program under the "National Housing Act," 48 Stat. 1246 (1934), 12 U.S.C.A. 1701, as amended;

(d) A bank, savings bank, or savings and loan association, or a subsidiary or an affiliate of a bank, savings bank, or savings and loan association. For purposes of division (C)(2)(d) of this section, "affiliate" has the same meaning as in division (A) of section 1101.01 of the Revised Code and "bank," as used in division (A) of section 1101.01 of the Revised Code, is deemed to include a savings bank or savings and loan association.

(e) A credit union organized and qualified under Chapter 1733. of the Revised Code or the "Federal Credit Union Act," 84 Stat. 994 (1970), 12 U.S.C.A. 1751, as amended;

(f) A budget and debt counseling service, as defined in division (D) of section 2716.03 of the Revised Code, provided that the service is a nonprofit organization exempt from taxation under section 501(c)(3) of the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C.A. 501, as amended, and that the service is in compliance with Chapter 4710. of the Revised Code;

(g) A consumer reporting agency that is in substantial compliance with the "Fair Credit Reporting Act," 84 Stat. 1128, 15 U.S.C.A. 1681a, as amended.

(h) A mortgage banker;

(i) Any political subdivision, or any governmental or other public entity, corporation, or agency, in or of the United States or any state of the United States;

(j) A college or university, or controlled entity of a college or university, as defined in section 1713.05 of the Revised Code;

(k) A motor vehicle dealer licensed pursuant to Chapter 4517. of the Revised Code acting within the scope and authority of that license or a motor vehicle auction owner licensed pursuant to Chapters 4517. and 4707. of the Revised Code acting within the scope and authority of that license.

(D) "Extension of credit" means the right to defer payment of debt, or to incur debt and defer its payment, offered or granted primarily for personal, family, or household purposes. "Extension of credit" does not include a mortgage.

(E) "Mortgage" means any indebtedness secured by a deed of trust, security deed, or other lien on real property.

(F) "Mortgage banker" means any person that makes, services, or buys and sells mortgage loans and is approved by the United States department of housing and urban development, the United States department of veterans affairs, the federal national mortgage association, or the federal home loan mortgage corporation.

(G) "Superintendent of financial institutions" includes the deputy superintendent for consumer finance as provided in section 1181.21 of the Revised Code.

Sec. 4712.07.  No credit services organization, salesperson, agent, or representative of a credit services organization, or independent contractor that sells or attempts to sell the services of a credit services organization shall do any of the following:

(A) Charge or receive directly or indirectly from a buyer money or other consideration readily convertible into money until all services the organization has agreed to perform for the buyer are completed within the time periods described in division (A)(3) of section 4712.05 of the Revised Code.

(B) Charge or receive directly or indirectly from a buyer money or other consideration readily convertible into money for the referral of the buyer to a person that makes an extension of credit or to a consumer reporting agency, except when credit has actually been extended as a result of that referral;

(C) Make or use a false or misleading representation in the offer or sale of the services of the organization, including either of the following:

(1) Guarantying or otherwise stating that the organization is able to delete an adverse credit history, unless the representation clearly discloses that this can be done only if the credit history is inaccurate or obsolete;

(2) Guarantying or otherwise stating that the organization is able to obtain an extension of credit regardless of the buyer's previous credit problems or credit history, unless the representation clearly discloses the eligibility requirements for obtaining an extension of credit.

(D) Engage, directly or indirectly, in an unconscionable, unfair, or deceptive act or practice, as those terms are used and defined in Chapter 1345. of the Revised Code, in connection with the offer or sale of the services of a credit services organization;

(E)(1) Make or advise a buyer to make a false or misleading statement concerning the buyer's creditworthiness, identification, credit standing, or credit capacity to any of the following:

(a) A consumer reporting agency;

(b) A person that has made an extension of credit to the buyer;

(c) A person to which the buyer is applying for an extension of credit.

(2) Division (E)(1) of this section applies to any statement that the organization, salesperson, agent, representative, or independent contractor knows or should know to be false or misleading through the exercise of reasonable care.

(F) Advertise or cause to be advertised, in any manner, the services of a credit services organization without being registered with the division of financial institutions;

(G) Fail to maintain a statutory agent as required under division (E) of section 4712.02 of the Revised Code;

(H) Transfer or assign a certificate of registration issued by the division pursuant to section 4712.02 of the Revised Code;

(I) Submit the buyer's disputes to a consumer reporting agency without the buyer's knowledge as evidenced by positive identification, including the buyer's correct current residence address, and written authorization personally signed by the buyer;

(J) Fail to maintain, for a period of time as determined by the superintendent of financial institutions, all of the following:

(1) A log of all contracts;

(2) Copies of each contract;

(3) Documentation that substantiates the validity of the representation made pursuant to division (A)(5) of section 4712.05 of the Revised Code;

(4) Any other record specified by the superintendent.

(K) Contact a consumer reporting agency, by telephone or otherwise, for the purpose of submitting or obtaining information relative to any buyer, and state or imply that he or she is the buyer or the buyer's attorney, guardian, or other legal representative;

(L) Engage, directly or indirectly, in any fraudulent or deceptive act, practice, or course of business in connection with the offer or sale of the services of a credit services organization, including knowingly acting in or abetting a scheme to create an evasion of restrictions on fees or charges as set forth in Chapter 1321. of the Revised Code.

Section 2. That existing sections 1315.26, 1321.02, 1321.12, 1321.13, 1321.131, 1321.14, 1321.15, 1321.44, 1321.52, 1321.53, 1321.551, 1321.56, 1321.57, 1321.571, 1321.59, 1321.99, 1322.01, 1343.01, 1345.01, 4710.02, 4712.01, and 4712.07 of the Revised Code are hereby repealed.

Section 3.  Section 1321.14 of the Revised Code is presented in this act as a composite of the section as amended by both Am. Sub. S.B. 293 and Sub. H.B. 495 of the 121st General Assembly. The General Assembly, applying the principle stated in division (B) of section 1.52 of the Revised Code that amendments are to be harmonized if reasonably capable of simultaneous operation, finds that the composite is the resulting version of the section in effect prior to the effective date of the section as presented in this act.