CHAPTER 2. Consumer Loans [22200. - 22470.]

Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2.

§§ 22200–22470 · 101 sections

1. ARTICLE 1. Definitions §§ 22200–22204 · 5 sections

   • § 22200 “Charges” include the aggregate interest, fees, bonuses, commissions, brokerage, discounts, expenses, and other forms of costs charged, contracted for, or…
   • § 22201 “Charges” include any profit or advantage of any kind that a licensee may contract for, collect, receive, or obtain by a collateral sale, purchase, or…
   • § 22202 “Charges” do not include any of the following: (a) Commissions received as a licensed insurance agent or broker in connection with insurance written as…
   • § 22203 “Consumer loan” means a loan, whether secured by either real or personal property, or both, or unsecured, the proceeds of which are intended by the borrower…
   • § 22204 (a) In addition to the definition of consumer loan in Section 22203, a “consumer loan” also means a loan of a principal amount of less than five thousand…
2. ARTICLE 2. Exemptions §§ 22250–22252 · 3 sections

   • § 22250 (a) The following sections do not apply to any loan of a bona fide principal amount of ten thousand dollars ($10,000) or more, or to a duly licensed finance…
   • § 22251 Any section that refers to this section does not apply to any loan of the bona fide principal amount specified in the regulatory ceiling provision of that…
   • § 22252 This chapter does not apply to a program administrator or a PACE solicitor.
3. ARTICLE 3. Loan Regulations §§ 22300–22347 · 53 sections

   • § 22300 No licensee shall directly or indirectly charge, contract for, or receive any interest or charge of any nature unless a loan is made.
   • § 22301 (a) No licensee shall directly or indirectly charge, contract for, or receive any interest or charge of any nature with respect to a loan of five thousand…
   • § 22302 (a) Section 1670.5 of the Civil Code applies to the provisions of a loan contract that is subject to this division. (b) A loan found to be unconscionable…
   • § 22303 Every licensee who lends any sum of money may contract for and receive charges at a rate not exceeding the sum of the following: (a) Two and one-half percent…
   • § 22304 As an alternative to the charges authorized by Section 22303, a licensee may contract for and receive charges at the greater of the following: (a) A rate not…
   • § 22304.5 (a) For any loan of a bona fide principal amount of at least two thousand five hundred dollars ($2,500) but less than ten thousand dollars ($10,000), as…
   • § 22305 In addition to the charges authorized by Section 22303, 22304, or 22304.5, a licensee may contract for and receive an administrative fee, which shall be fully…
   • § 22306 No amount in excess of that allowed by this article shall be directly or indirectly charged, contracted for, or received by any person, and the total charges…
   • § 22307 (a) Except as provided in Section 22305 and Article 4 (commencing with Section 22400), all charges on loans made under this division shall be computed and paid…
   • § 22307.5 A licensee shall not charge, impose, or receive any penalty for the prepayment of a loan. This section does not apply to a loan secured by real property.
   • § 22308 Notwithstanding Section 22307, a licensee may contract for and receive charges on the unpaid principal balance at a single annual percentage rate, applied on…
   • § 22309 Except as provided in Section 22305 and Article 4 (commencing with Section 22400), no charges on loans made pursuant to this division shall be paid, deducted,…
   • § 22310 (a) Except for a rebate or refund pursuant to any administrative, civil, or criminal action, or any act of the commissioner, a rebate or refund required to be…
   • § 22311 No person in connection with or incidental to the making of any loan regulated by this division may require the borrower to contract for purchase, or agree to…
   • § 22312 No person in connection with or incidental to the making of a loan shall require the borrower to enter into any collateral sales agreements or contracts, other…
   • § 22313 Insurance on tangible personal or real property offered as security shall not be deemed to be a collateral sale, purchase, or agreement within the terms of…
   • § 22314 (a) Credit insurance shall not be deemed to be a collateral sale, purchase, or agreement within the terms of Section 22201, 22311, or 22312 when the insurance…
   • § 22315 (a) Credit disability insurance written pursuant to Section 22314 shall not provide indemnity against the risk that the borrower will become disabled for a…
   • § 22316 A licensee may collect the cost of a lot book report purchased in lieu of the title insurance provided for in Section 22313. The cost is not included in…
   • § 22317 On any loan made that is secured by real property, an appraisal fee not to exceed the actual cost of the appraisal may be charged by the licensee if a written…
   • § 22317.2 (a) A licensee may collect a fee for use of an automated valuation model result prepared by a third party not to exceed the actual cost paid to the third party…
   • § 22317.5 On any loan secured by real property, a licensee may not do either of the following: (a) Fail to disburse funds in accordance with a commitment to make a loan…
   • § 22318 On any loan made that is secured by real property, an escrow fee of a reasonable amount may be charged. The fee shall be considered reasonable when paid to a…
   • § 22319 On any loan that is secured by real property, the fee to be paid to the trustee for reconveyance of the trust deed may be collected by the licensee for…
   • § 22320 With respect to a loan under this division, a fee not to exceed fifteen dollars ($15) for the return by a depository institution of a dishonored check,…
   • § 22320.5 (a) A licensee may contract for and receive a delinquency fee not in excess of one of the following amounts: (1) For a period in default of not less than 10…
   • § 22321 If credit loss-of-income insurance is provided pursuant to this division, it shall be subject to the following conditions: (a) The insurance shall provide…
   • § 22322 A loan lawfully made outside the state may be enforced in this state as to the unpaid principal balance of the loan together with the interest, consideration,…
   • § 22323 Any person who collects or attempts to collect in this state the unpaid principal balance of a loan made outside the state and a greater aggregate amount of…
   • § 22324 Any person who contracts for or negotiates in this state a loan to be made outside the state for the purpose of evading or avoiding the provisions of this…
   • § 22325 Every licensee shall display prominently in each licensed place of business a full and accurate schedule of the charges to be made and the method of computing…
   • § 22326 No person, except as authorized by this division, shall directly or indirectly charge, contract for, or receive any interest, discount, or consideration…
   • § 22327 No licensee shall knowingly induce any borrower to split up or divide any loan with any other licensee. No licensee shall induce or permit any borrower to be…
   • § 22328 (a) This section applies to a loan secured in whole or in part by a lien on a motor vehicle as defined by subdivision (k) of Section 2981 of the Civil Code.…
   • § 22329 (a) This section applies to a loan secured in whole or in part by a lien on a motor vehicle as defined by subdivision (k) of Section 2981 of the Civil Code.…
   • § 22329.5 A licensee, or the agent of a licensee, that has received a notice pursuant to Section 7507.6 of the Business and Professions Code, shall not make a subsequent…
   • § 22330 No licensee shall take a deed of trust, mortgage, or lien upon real property as security for any loan made under this division, except any lien as is created…
   • § 22331 No licensee shall take any confession of judgment or any power of attorney, except a power of attorney taken to effectuate the transfer of the ownership of any…
   • § 22332 No licensee shall take any note or promise to pay that does not accurately disclose the actual amount of the loan, the time for which it is made, and the…
   • § 22333 No licensee shall take any instrument in which blanks are left to be filled in after execution.
   • § 22334 (a) Except as provided in subdivision (b), a licensee shall not enter into any contract for a loan that provides for a scheduled repayment of principal over…
   • § 22335 The payment by any person in money, credit, goods, or things in action as consideration for any sale or assignment of, or order for, the payment of wages,…
   • § 22336 This article does not prohibit any licensee from contracting for, collecting, or receiving the following: (a) The statutory fee paid by the licensee to any…
   • § 22337 Each licensed finance lender shall: (a) Deliver or cause to be delivered to the borrower, or any one thereof, at the time the loan is made, a statement showing…
   • § 22338 Each licensed broker shall: (a) Deliver to the borrower, or any one thereof, at the time the final negotiation or arrangement is made, a statement showing in…
   • § 22339 Nothing contained in this article shall be construed to deny to any licensee hereunder the right of taking and using a security agreement that, in addition to…
   • § 22340 (a) A licensee may sell promissory notes evidencing the obligation to repay loans made by the licensee pursuant to this division or evidencing the obligation…
   • § 22340.1 (a) A licensee that is a finance lender may sell to (1) an institutional lender, or (2) an institutional investor described in paragraph (6) of subdivision (b)…
   • § 22341 (a) No licensee may make a loan to refinance a retail installment contract subject to Chapter 1 (commencing with Section 1801) of Title 2 of Part 4 of Division…
   • § 22342 (a) As used in this section, “instant loan check” or “live check” means any loan or extension of credit that is made available in the form of a check, draft,…
   • § 22345 (a) Any person who violates any provision of Section 987 of Title 10 of the United States Code, as amended by 126 Stat. 1785 (Public Law 112-239), or any…
   • § 22346 Any licensee that violates any provision of any of the following federal acts or regulations violates this division: (a) The federal Real Estate Settlement…
   • § 22347 The unique identifier of any licensed mortgage loan originator shall be clearly shown on all residential mortgage loan application forms, solicitations, or…
4. ARTICLE 3.6. Pilot Program for Increased Access to Responsible Small Dollar Loans §§ 22365–22381 · 18 sections

   • § 22365 (a) The Pilot Program for Increased Access to Responsible Small Dollar Loans is hereby established. (b) For purposes of this article: (1) “Commissioner” means…
   • § 22366 (a) Any entity licensed under this chapter that wishes to participate in the program, that is in good standing with the commissioner and has no outstanding…
   • § 22367 Every entity approved by the commissioner to participate in the program shall file with the commissioner on or before March 15 an annual report consistent with…
   • § 22368 Except as otherwise provided, nothing in this article shall exempt any licensee from any of the provisions of this division or Section 1632 of the Civil Code.
   • § 22369 No licensee may offer or make a loan, nor impose any charges or fees pursuant to Section 22370, nor use a finder pursuant to Section 22371, without prior…
   • § 22370 (a) A loan made pursuant to this section shall comply with the following requirements: (1) The loan shall be unsecured. (2) Interest on the loan shall accrue…
   • § 22371 (a) A licensee who is approved by the commissioner to participate in the program may use the services of one or more finders as provided in this article. In…
   • § 22372 (a) A finder may perform one or more of the following services for a licensee at the finder’s physical location for business: (1) Distributing, circulating,…
   • § 22373 (a) At the time the finder receives or processes an application for a program loan, the finder shall provide the following statement to the applicant, on…
   • § 22374 (a) A finder may be compensated by the licensee pursuant to the written agreement between the licensee and the finder, as described in Section 22376.…
   • § 22375 A licensee that utilizes the service of a finder shall do all of the following: (a) Notify the commissioner within 15 days of entering into a contract with a…
   • § 22376 All arrangements between a licensee and a finder shall be set forth in a written agreement between the parties. The agreement shall contain a provision…
   • § 22377 (a) The commissioner may examine the operations of each licensee and each finder to ensure that the activities of the licensee and the finder are in compliance…
   • § 22378 Notwithstanding the requirements of Section 22102 and its implementing regulations, a licensee accepted to participate in the program may appoint one or more…
   • § 22379 (a) Notwithstanding any other law, the commissioner shall examine each licensee that is accepted into the program, and each finder whose services were used by…
   • § 22380 (a) On or before July 1, 2015, and annually on or before July 1, 2017, to July 1, 2026, inclusive, the commissioner shall post a report on the commissioner’s…
   • § 22380.5 (a) The Pilot Program for Affordable Credit-Building Opportunities as described in Article 3.5 (commencing with Section 22348) is abolished. (b) All powers,…
   • § 22381 This article shall remain in effect only until January 1, 2028, and as of that date is repealed.
5. ARTICLE 4. Charges On Scheduled Balances §§ 22400–22402 · 3 sections

   • § 22400 This article applies only to loan contracts payable in substantially equal and consecutive monthly installments of principal and charges combined, the first of…
   • § 22401 With respect to precomputed loans, licensees shall be subject only to, comply only with, and derive authority only from Sections 22400 and 22402,…
   • § 22402 When charges on a loan of an original bona fide principal amount of five thousand ($5,000) or more have been precomputed in a manner similar to that provided…
6. ARTICLE 5. Open-End Loan Programs §§ 22450–22467 · 18 sections

   • § 22450 As used in this division, “open-end credit program” means a licensee’s plan for making open-end loans pursuant to a loan agreement that sets forth the terms…
   • § 22451 If an open-end credit program is not primarily for the purpose of purchasing or leasing goods or services from the licensee, then all credit extended through…
   • § 22452 Subject to the written approval of the commissioner of the licensee’s plan of business for making open-end loans as not being misleading or deceptive and…
   • § 22453 The minimum monthly payment shall be determined by any of the following: (a) The amount calculated by multiplying the unpaid principal balance, after an…
   • § 22454 On open-end loans, the licensee may contract for and receive the fees, costs, and expenses permitted on other loans, including those permitted by subdivisions…
   • § 22455 (a) In lieu of subdivisions (b), (c), (d), (e), and (f) of Section 22314, with respect to open-end loans, a licensee may provide credit insurance with the…
   • § 22456 Section 22309 shall apply to open-end loans with the following variations: (a) To comply with Section 22309, in the case of open-end loan advances directly to…
   • § 22457 In lieu of Section 22332, the open-end loan agreement shall contain the name, address, and license number of the finance lender and shall disclose the nature…
   • § 22458 In lieu of subdivision (a) of Section 22337, with respect to open-end loans, except in the case of an account that the licensee deems to be uncollectible, or…
   • § 22459 Subdivision (e) of Section 22337 shall not apply to an open-end loan that has no balance outstanding if the open-end loan agreement continues in effect.
   • § 22460 Section 22333 shall not apply to a change in terms of an open-end loan if notice is given to the borrower in accordance with subsection (c) of Section 226.9 of…
   • § 22461 Subdivision (a) of Section 22151, Sections 22154 and 22325, and subdivision (b) of Section 22337 shall not apply to a licensee with respect to advances made…
   • § 22462 The payment of fees for participation in an open-end credit program, the acceptance by a borrower of the form of the licensee’s program, and the borrower’s…
   • § 22463 Nothing in this article limits the authority of the commissioner to disapprove advertising with respect to open-end loans pursuant to Section 22165.
   • § 22464 This article does not apply to loans other than open-end loans.
   • § 22465 Section 22400 does not apply to open-end loans.
   • § 22466 An open-end loan is in compliance with Section 22330 if it is an open-end loan of a bona fide principal amount of five thousand dollars ($5,000) or more as…
   • § 22467 (a) Any section that refers to this section or that is subject to Section 22251 does not apply to any open-end loan of the bona fide principal amount specified…
7. ARTICLE 6. Disclosure of Loan Applications § 22470 · 1 section

   • § 22470 (a) (1) Upon the request of a person who has obtained a police report pursuant to Section 530.6 of the Penal Code, a finance lender engaged in the business of…