54-4-44. Engaging in business after procurement of license--Maximum finance charge--Violation as misdemeanor--Loan void.

After procuring such license from the Division of Banking, the licensee may engage in the business of making loans and may contract for and receive interest charges and other fees at rates, amounts, and terms as agreed to by the parties which may be included in the principal balance of the loan and specified in the contract. However, no licensee may contract for or receive finance charges pursuant to a loan in excess of an annual rate of thirty-six percent, including all charges for any ancillary product or service and any other charge or fee incident to the extension of credit. A violation of this section is a Class 1 misdemeanor. Any loan made in violation of this section is void and uncollectible as to any principal, fee, interest, or charge.

Source: SL 1998, ch 280, § 9; SL 2017, ch 221 (Initiated Measure 21), § 2, eff. Nov. 16, 2016; SL 2017, ch 205, § 2.

54-4-44.1. Device, subterfuge, or pretense to evade maximum finance charge prohibited--Penalties.

No person may engage in any device, subterfuge, or pretense to evade the requirements of § 54-4-44, including, but not limited to, making loans disguised as a personal property sale and leaseback transaction; disguising loan proceeds as a cash rebate for the pretextual installment sale of goods or services; or making, offering, assisting, or arranging a debtor to obtain a loan with a greater rate of interest, consideration, or charge than is permitted by this chapter through any method including mail, telephone, internet, or any electronic means regardless of whether the person has a physical location in the state. Notwithstanding any other provision of this chapter, a violation of this section is subject to the penalties in § 54-4-44.

Source: SL 2017, ch 221 (Initiated Measure 21), § 3, eff. Nov. 16, 2016.

54-4-44.2. Motor vehicle purchase loan--Fees incident to extension of credit.

For purposes of § 54-4-44, fees contracted for or received that are "incident to the extension of credit" in connection with a loan for the purchase of a motor vehicle do not include fees for optional maintenance agreements and extended service contracts, official fees and taxes, sales tax, title fees, lien registration fees, and dealer documentary fees.

Source: SL 2017, ch 205, § 3.

54-4-44.3. Consumer default--Fees incident to extension of credit.

For the purposes of § 54-4-44 for all loans, late fees, return check fees, and attorney's fees incurred upon consumer default are not fees "incident to the extension of credit."

Source: SL 2017, ch 205, § 4.

54-4-44.4. Business-to-business lending exempt.

The provisions of § 54-4-44 that place limitations on licensees that are engaged in the business of making loans do not apply to a licensee engaged in business-to-business lending. For purposes of this section, the term, business-to-business lending, means any lending to or in furtherance of a business, commercial, or agricultural venture that is not for personal, family, or household use and is not secured by a nonpurchase money security interest in a motor vehicle. Any business-to-business lending subject to the provisions of this section shall be in an amount not less than five thousand dollars and only to a borrower with a federal employer identification number.

Source: SL 2017, ch 206, § 1; SL 2018, ch 272, § 1.