Skip to main content

Search

Consumer Credit Regulation: 12 U.S.C. § 1735f-7a. State constitution or laws limiting mortgage interest, discount points, and finance or other charges; exemption for obligations made after March 31, 1980

(a) Applicability to loan, mortgage, credit sale, or advance; applicability to deposit, account, or obligation

(1) The provisions of the constitution or the laws of any State expressly limiting the rate or amount of interest, discount points, finance charges, or other charges which may be charged, taken, received, or reserved shall not apply to any loan, mortgage, credit sale, or advance which is—

Consumer Credit Regulation: 12 C.F.R. § 190.2 Definitions.

For the purposes of this part, the following definitions apply:

(a) Loans mean any loans, mortgages, credit sales, or advances.

(b) Federally-related loans include any loan:

(1) Made by any lender whose deposits or accounts are insured by any agency of the Federal government;

(2) Made by any lender regulated by any agency of the Federal government;

Consumer Credit Regulation: 12 C.F.R. § 190.3 Operation.

(a) The provisions of the constitution or law of any state expressly limiting the rate or amount of interest, discount points, finance charges, or other charges which may be charged, taken, received, or reserved shall not apply to any Federally-related loan:

(1) Made after March 31, 1980; and

(2) Secured by a first lien on:

(i) Residential real property;

Consumer Credit Regulation: 12 C.F.R. § 190.4 Federally-related residential manufactured housing loans—consumer protection provisions.

(a) Definitions. As used in this section:

(1) Prepayment. A “prepayment” occurs upon—

(i) Refinancing or consolidation of the indebtedness;

(ii) Actual prepayment of the indebtedness by the debtor, whether voluntarily or following acceleration of the payment obligation by the creditor; or

(iii) The entry of a judgment for the indebtedness in favor of the creditor.

Consumer Credit Regulation: 12 C.F.R. § 190.100 Status of Interpretations issued under Public Law 96-161.

The OCC continues to adhere to the views expressed in the formal Interpretations issued under the authority of section 105(c) of Public Law 96-161, 93 Stat. 1233 (1979). These interpretations, which relate to the temporary preemption of state interest ceilings contained in Public Law 96-161, may be found at 45 FR 2840 (Jan. 15, 1980); 45 FR 6165 (Jan. 25, 1980); 45 FR 8000 (Feb. 6, 1980); 45 FR 15921 (Mar. 12, 1980).

Consumer Credit Regulation: 12 C.F.R. § 190.101 State criminal usury statutes.

(a) Section 501 provides that “the provisions of the constitution or laws of any state expressly limiting the rate or amount of interest, discount points, finance charges, or other charges shall not apply to any” Federally-related loan secured by a first lien on residential real property, a residential manufactured home, or all the stock allocated to a dwelling unit in a residential housing cooperative. 12 U.S.C. 1735f–7 note (Supp. IV 1980).

Consumer Credit Regulation: 1.1.2 Topics Covered and Relation to Other NCLC Treatises

This treatise examines federal and state restrictions on consumer credit transactions, and federal preemption of the state restrictions. It focuses on interest rates, fees, third-party charges, rebates of unearned interest, late charges and other credit terms for non-mortgage credit. Other NCLC treatises detail limits on creditor remedies where a consumer defaults on a credit obligation—debt collection, collection lawsuits, repossessions, credit reporting, and garnishment. This treatise focuses on the origination of non-mortgage credit obligations and their terms.

Consumer Credit Regulation: 1.1.3 Why This Treatise

There is a widespread belief that regulation of consumer credit is minimal—that federal law offers few protections, that state limits have been deregulated, and that those state limits that do exist can be avoided through federal preemption, rate exportation, or other means. The true picture today is far more complex.

Consumer Credit Regulation: 1.1.5 Pleadings, Primary Sources, and Practice Tools

The digital version of the treatise also includes pleadings and discovery, practice tools, and primary sources, that can easily be downloaded, emailed, and cut and pasted into documents. They are listed at the bottom of the table of contents found in the left pane and are fully searchable. Search filters allow users to search only for pleadings, only for primary sources, or only for practice tools. Searching for pleadings is recommended using the Advanced Pleadings Search tool, found above the Search box.

Consumer Credit Regulation: Kan. Stat. Ann. §§ 16a-2-101 to 16a-9-102 (Consumer Credit Code).

What types of lenders it applies to (e.g., banks vs. non-banks): Act applies to “consumer credit transactions,” broadly defined. § 16a-1-301(5). Excludes extensions of credit to government or governmental agencies, certain transactions under public utility or common carrier tariffs, licensed pawnbrokers (except for disclosure requirements), and transactions covered by the insurance premium finance act. § 16a-1-202.

Consumer Credit Regulation: Mass. Gen. Laws ch. 140, §§ 114B, 114C; 209 Mass. Code Regs. § 26.01.

What types of lenders it applies to (e.g., banks vs. non-banks): Any creditor. § 114B.

Licensure requirements and implications of licensure: None.

Size and length of loans to which the statute applies, and any restrictions in the statute on these features: Statute is silent.

Other restrictions on applicability of statute (e.g., it only applies if lender takes a mortgage on real property): Applies to open-end credit plans. § 114B. Section 114C applies to credit card issuers.

Consumer Credit Regulation: Mich. Comp. Laws §§ 493.1 to 493.24 (Regulatory Loan Act).

What types of lenders it applies to (e.g., banks vs. non-banks): Applies generally to lenders, but exempts banks, savings banks, industrial banks, trust companies, building and loan associations, credit unions, and licensed pawnbrokering. §§ 493.2, 493.20.

Licensure requirements and implications of licensure: Must have license to make loans at rate higher than non-licensee can charge. § 493.2(1).

Size and length of loans to which the statute applies, and any restrictions in the statute on these features: Statute is silent.

Consumer Credit Regulation: Mich. Comp. Laws §§ 445.1851 to 445.1864 (Credit Reform Act).

What types of lenders it applies to (e.g., banks vs. non-banks): Act applies to extensions of credit made by regulated lenders. § 445.1854. “Regulated lender” means a depository institution, a licensee under the consumer financial services act, the motor vehicle sales finance act, or the regulatory loan act (summarized above), or a seller under the home improvement finance act. § 445.1852(i).

Consumer Credit Regulation: Mich. Comp. Laws §§ 493.101 to 493.114 (Regulatory Loans; Credit Card Arrangements).

What types of lenders it applies to (e.g., banks vs. non-banks): Applies generally to lenders that offer credit cards, but excludes banks, savings and loan associations, credit unions, and retail sellers or other creditors under the Retail Installment Sales Act, except that, to the extent such a lender uses the rate authority provided in the Act, it must also comply with the Act’s other substantive provisions. § 493.114(1).

Consumer Credit Regulation: Miss. Code Ann. § 75-17-19 (Revolving Charge Agreements).

What types of lenders it applies to (e.g., banks vs. non-banks): Any lender or issuer of credit cards and any retail seller. § 75-17-19(1).

Licensure requirements and implications of licensure: Statute is silent.

Size and length of loans to which the statute applies, and any restrictions in the statute on these features: Statute is silent.

Other restrictions on applicability of statute (e.g., it only applies if lender takes a mortgage on real property): Statute is silent.

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

What types of lenders it applies 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 it applies 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.C. Gen. Stat. § 24-11 (Open-End Credit).

What types of lenders it applies to (e.g., banks vs. non-banks): Does not apply to banks, savings and loan associations, savings banks, or credit unions. § 24-9.

Licensure requirements and implications of licensure: Statute is silent. Note that §§ 53-166(a) and 53-168(a) require a creditor to have a license if it makes loans that exceed the interest rates provided by this chapter.

Size and length of loans to which the statute applies, and any restrictions in the statute on these features: Statute is silent.

Consumer Credit Regulation: 8.6.8.2 Minimum Payment Repayment Disclosures

In response to the problem of low minimum payments, the Credit CARD Act added a requirement that lenders disclose the actual number of months that it will take to pay off the balance on an account if the consumer makes only the minimum payment.482 Lenders are required to provide the following warning in periodic statements using the exact language below:483