Skip to main content

Search

Consumer Credit Regulation: N.H. Rev. Stat. Ann. §§ 399-A:1 to 399-A:24 (Small Loans).

What types of lenders does it apply to (e.g., banks vs. non-banks)? Any person engaged in the business of making small loans, including closed-end loans, open-end loans, title loans, and payday loans. §§ 399-A:1(XX), 399-A:2. Chapter does not apply to banks, trust companies, insurance companies, savings or building and loan associations, credit unions, or lenders that exclusively make educational loans. §§ 399-A:1(XII), 399-A:2(III), 399-A:3.

Consumer Credit Regulation: N.J. Stat. Ann. §§ 17:11C-1 to 17:11C-49 (West) (New Jersey Consumer Finance Licensing Act).

What types of lenders does it apply to (e.g., banks vs. non-banks)? Applies to anyone making covered loans, but depository institutions, trust companies, insurance companies, and pawnbrokers are exempt. § 17:11C-6.

Licensure requirements and implications of licensure: License required to engage in consumer loan business, i.e., make consumer loans of $50,000 or less at rates greater than a non-licensee may charge. § 17:11C-3. Loan made without a required license is void unless lender meets statutory good faith error requirements. § 17:11C-33(b).

Consumer Credit Regulation: N.Y. Banking Law §§ 340 to 361 (McKinney) (Licensed Lender Law).

What types of lenders does it apply to (e.g., banks vs. non-banks)? Applies to anyone making loans of $25,000 or less to an individual for personal, family, household, or investment purposes (up to $50,000 if a business or commercial loan) who charges more than otherwise legal rate. Does not apply to pawnbrokers licensed under Gen. Bus. Law §§ 40–55. Banking Law § 340.

Consumer Credit Regulation: N.C. Gen. Stat. §§ 24-1 to 24-11.2 (Interest—General Provisions).

What types of lenders does it apply to (e.g., banks vs. non-banks)? Applies to all lenders. §§ 24-1.1(a), 53-141(2) (applying these rates to industrial banks).

Licensure requirements and implications of licensure: Not a licensing statute.

Size and length of loans to which the statute applies, and any restrictions in the statute on these features: Does not apply to loans over $300,000. § 24-1.1(f).

Consumer Credit Regulation: Okla. Stat. tit. 59, § 3150 to 3150.27 (Small Lenders Act) (applicable to loans made on or after August 1, 2020).

What types of lenders does it apply to (e.g., banks vs. non-banks)? Banks, savings institutions, trust companies, building and loan associations, industrial loan associations, and credit unions are ineligible for licensure. § 3150.2(C).

Licensure requirements and implications of licensure: All persons engaged in the business of making small loans as defined by this Act must be licensed. § 3150.2.

Consumer Credit Regulation: Tenn. Code Ann. §§ 45-5-101 to 45-5-612 (Industrial Loan and Thrift Companies).

What types of lenders does it apply to (e.g., banks vs. non-banks)? Industrial loan and thrift companies, industrial banks, industrial investment companies. § 45-5-103(a). Law is inapplicable to banks (other than industrial banks), savings and loan associations, credit unions, insurance companies, any other persons engaged in the business of making loans who are subject to supervision and regulation by a state or federal administrative agency, and licensed pawnbrokers. § 45-5-104.

Consumer Credit Regulation: Va. Code Ann. §§ 6.2-1500 to 6.2-1543 (Consumer Finance Companies).

What types of lenders does it apply to (e.g., banks vs. non-banks)? Does not apply to banks, savings institutions, trust companies, building and loan associations, industrial loan associations, credit unions, licensed pawnbrokers, or persons operating in accordance with the specific provisions of any other provision of title 6.2, which includes provisions regarding vehicle title lenders, short-term loan lenders, and mortgage lenders. § 6.2-1503.

Consumer Credit Regulation: Wis. Stat. § 138.09 (Licensed Lenders).

What types of lenders does it apply to (e.g., banks vs. non-banks)? Does not apply to banks, savings banks, savings and loan associations, trust companies, credit unions, or any of their affiliates, or to payday loans. § 138.09(1a).

Licensure requirements and implications of licensure: Must obtain license to do business under provision, charge interest authorized by provision, or assess finance charge on consumer loan over 18% per year. § 138.09(1m)(a).

Consumer Credit Regulation: G.3 OCC/OTS Interpretations

The Office of the Comptroller of the Currency and the former Office of Thrift Supervision have issued a large number of interpretive and advisory letters concerning preemption of state law. The full text and summaries of letters that were issued prior to the enactment of the Dodd-Frank Act are available as online companion material to this treatise.

Credit Discrimination: 2.5 Scope of State Credit Discrimination Statutes

By and large, the scope of state credit discrimination statutes follows the scope of the federal statute they are modeled after. Nevertheless, sometimes the scope of a state statute will be broader than the scope of the analogous federal statute, and it may prove particularly valuable in those situations.

Credit Discrimination: 2.6 Scope of State UDAP Statutes

Occasionally, a state statute generally prohibiting unfair or deceptive acts or practices (a UDAP statute) may be used to challenge credit discrimination not prohibited by any other statute, or a UDAP claim may be useful if a discrimination statute does not provide a sufficient remedy.332 Nevertheless, various scope issues may limit the applicability of a state UDAP statute to credit discrimination.

Credit Discrimination: 2.7 Summary of Key ECOA and FHA Provisions

An advocate will often have to choose whether to bring claims under the Equal Credit Opportunity Act (ECOA) or the Fair Housing Act (FHA). Claims under both laws are not viable in some cases because of a provision in the ECOA that no person aggrieved by an ECOA violation and, in the same transaction, by a violation of the FHA’s prohibitions concerning residential real estate-related discrimination can recover under both the ECOA and the FHA.342

Key advantages and disadvantages of each law are discussed below:

Credit Discrimination: 7.1 Introduction and History of Redlining

Redlining refers to the practice of separating out certain neighborhoods for disparate treatment as to mortgage or other types of lending. Redlining began as a result of the policies of the Home Owners’ Loan Corporation (HOLC) in the 1930s. The HOLC was created to help families prevent the loss of homes through foreclosure.1

Credit Discrimination: 7.2.1 The ECOA, FHA, and Federal Civil Rights Acts

To the extent redlining is based on a desire to avoid making loans to certain ethnic or racial groups—or loans in areas where such groups predominate—the practice involves disparate treatment on a prohibited basis in clear violation of credit discrimination statutes.11 Precedent has developed over the years allowing plaintiffs to use the Fair Housing Act (FHA) to challenge such redlining practices.12 The Equal Credit Opportunity Act (ECOA) and civil rights statutes may also be used to challenge redl

Credit Discrimination: 7.2.2 Government Enforcement Actions

Government enforcement actions have focused on alleged illegal redlining or discriminatory marketing practices.26 Most of the government enforcement actions were filed with simultaneous settlement agreements or consent decrees. Although these cases have no direct precedential value, they are important models for public and private fair lending cases.

Credit Discrimination: 7.3.1 Overview

Insurance redlining is the practice of “charging higher rates or declining to write insurance for people who live in particular areas (figuratively, sometimes literally, enclosed with a red line on a map).”90 The definition is usually expanded to include discrimination against individuals on the basis of a factor unrelated to risk in providing residential property and casualty insurance.

Credit Discrimination: 7.3.2 The Impact of Insurance Redlining

Insurance redlining seriously undermines the ability of affected individuals to purchase and safeguard their homes. According to one court: “[T]he availability of housing is . . . dependent on the availability of insurance. It is elementary that without insurance, mortgage financing will be unavailable, because a mortgage lender simply will not lend money on the [uninsured] property.

Credit Discrimination: 7.3.3 Detecting Insurance Redlining

Insurance redlining, like other forms of discrimination, occurs in overt, as well as subtle, ways. Listed below are a few ways to detect unlawful insurance discrimination practices:

Application Criteria: Suspicious signs include applications that require, for example, information on the age or value of a dwelling, prior insurance history (some insurers will not accept customers who have been turned down by other insurance companies), credit rating, or property inspections only in certain neighborhoods.

Credit Discrimination: 7.3.4.1 The ECOA

The official interpretations of Regulation B explicitly state that it is not a violation of Regulation B for a creditor to obtain and use information about an applicant’s age, sex, or marital status for the purpose of determining insurance eligibility and premium rates, although not for the credit decision itself.111 Still, the Equal Credit Opportunity Act (ECOA) may be applicable when credit has been denied or some other adverse action was taken because the applicant refused to purchase insurance.