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SENATE BILL NO. 5948
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AS AMENDED BY THE HOUSE
C 318 L 87
State of Washington 50th Legislature 1987 Regular Session
By Senators Bottiger and Newhouse
Read first time 2/20/87 and referred to Committee on Financial Institutions.
AN ACT Relating to interest rates on retail installment contracts for the purchase of motor vehicles; amending RCW 63.14.130; and providing an effective date.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec. 1. Section 13, chapter 236, Laws of 1963 as last amended by section 5, chapter 280, Laws of 1984 and RCW 63.14.130 are each amended to read as follows:
The service charge shall be inclusive of all charges incident to investigating and making the retail installment contract or charge agreement and for the privilege of making the installment payments thereunder and no other fee, expense or charge whatsoever shall be taken, received, reserved or contracted therefor from the buyer.
(1) Except as provided in subsection (2) of this section, the service charge, in a retail installment contract, shall not exceed the highest of the following:
(a) A rate on outstanding unpaid balances which exceeds six percentage points above the average, rounded to the nearest one-quarter of one percent, of the equivalent coupon issue yields (as published by the Federal Reserve Bank of San Francisco) of the bill rates for twenty-six week treasury bills for the last market auctions conducted during February, May, August, and November of the year prior to the year in which the retail installment contract is executed; or
(b) Ten dollars.
(2) The service charge in a retail installment contract for the purchase of a motor vehicle shall not exceed the highest of the following:
(a) A rate on outstanding unpaid balances which exceeds six percentage points above the average, rounded to the nearest one-quarter of one percent, of the equivalent coupon issue yield (as published by the Federal Reserve Bank of San Francisco) of the bill rate for twenty-six week treasury bills for the last market auction conducted during February, May, August, or November, as the case may be, prior to the quarter in which the retail installment contract for purchase of the motor vehicle is executed; or
(b) Ten dollars.
As used in this subsection, "motor vehicle" means every device capable of being moved upon a public highway and in, upon, or by which any person or property is or may be transported or drawn upon a public highway, except for devices moved by human or animal power or used exclusively upon stationary rails or tracks.
(3) The service charge in a retail charge agreement, revolving charge agreement, lender credit card agreement, or charge agreement, shall not exceed one and one-half percent per month on the outstanding unpaid balances. If the service charge so computed is less than one dollar for any month, then one dollar may be charged.
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(4) A service charge may be computed on the median amount within a range
which does not exceed ten dollars and which is a part of a published schedule
of consecutive ranges applied to an outstanding balance, provided the median
amount is used in computing the service charge for all balances within such
range.
NEW SECTION. Sec. 2. This act shall take effect January 1, 1988.