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SB 489 - Amends the Consumer Finance Act - North Carolina Key Vote


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Title: Amends the Consumer Finance Act

Vote Smart's Synopsis:

Vote to pass a bill that amends various provisions of the Consumer Finance Act concerning licensed lenders and interest rates, effective July 1, 2013.


  • Prohibits an individual from engaging in the business of “lending” in amounts of $15,000 or less (Sec. 1).
  • Specifies that, for the purposes of this bill, the term “lending” is to include, but is not limited to, endorsing or otherwise securing loans or contracts for the repayment of loans (Sec. 1). 
  • Authorizes a licensee to make installment loans in total amounts not exceeding $15,000 (Sec. 4).
  • Authorizes licensed lenders to charge the following interest rates on loan amounts (Sec.4): 
    • For loans up to $10,000, 30 percent interest per year on the first $5,000 on outstanding balances;
    • For loans up to $10,000, 24 percent interest per year for the second $5,000 on outstanding balances; and
    • For loans over $10,000, 18 percent interest per year on outstanding balances.
  • Prohibits installment loans from being repayable in less than 12 months or more than 96 months (Sec. 4).
  • Authorizes a licensee to charge a 1 time fee of up to $15 for each single late payment (Sec. 5).
  • Authorizes a licensee to charge a late payment fee for any payment made 10 days or more after the due date (Sec. 5).
  • Prohibits licensed lenders from making loans to active military service members ranked E4 or lower unless certain requirements are met including, but not limited to, the following requirements (Sec. 7):
    • The licensee notifies the borrower’s company-level commander before the loan is completed, and sent a copy of the contract once the loan is complete; and
    • The borrower is authorized to withdraw from the contract within 30 days after signing the contract.
  • Prohibits a licensed lender from contacting a military service member or military service member’s spouse if he or she has been deployed to combat (Sec. 7).