CERTIFICATION OF ENROLLMENT

 

                   ENGROSSED HOUSE BILL 1411

 

 

 

 

 

 

                        55th Legislature

                      1997 Regular Session

Passed by the House March 7, 1997

  Yeas 70   Nays 25

 

 

 

Speaker of the

      House of Representatives

 

Passed by the Senate April 15, 1997

  Yeas 49   Nays 0

             CERTIFICATE

 

I, Timothy A. Martin, Chief Clerk of the House of Representatives of the State of Washington, do hereby certify that the attached is ENGROSSED HOUSE BILL 1411  as passed by the House of Representatives and the Senate on the dates hereon set forth.

 

 

 

President of the Senate

                          Chief Clerk

 

 

Approved Place Style On Codes above, and Style Off Codes below.  

                                FILED

          

 

 

Governor of the State of Washington

                   Secretary of State

                  State of Washington


          _______________________________________________

 

                     ENGROSSED HOUSE BILL 1411

          _______________________________________________

 

             Passed Legislature - 1997 Regular Session

 

State of Washington      55th Legislature     1997 Regular Session

 

By Representatives L. Thomas, Grant, Zellinsky, DeBolt and Benson

 

Read first time 01/24/97.  Referred to Committee on Financial Institutions & Insurance.

 

 

Authorizing the collection of fees and prepayment penalties for consumer loans.  


    AN ACT Relating to authorizing the collection of fees in connection with making consumer loans; amending RCW 31.04.105; and creating a new section.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

 

    Sec. 1.  RCW 31.04.105 and 1994 c 92 s 167 are each amended to read as follows:

    Every licensee may:

    (1) Lend money at a rate that does not exceed twenty-five percent per annum as determined by the simple interest method of calculating interest owed;

    (2)(a)(i) Until June 30, 2002, in connection with the making of a loan that is secured primarily by real estate, charge the borrower a nonrefundable loan origination fee, which may be included in the principal balance of the loan;

    (ii) After June 30, 2002, in connection with the making of a loan that is secured primarily by real estate, charge the borrower a nonrefundable loan origination fee not to exceed four percent of the first twenty thousand dollars and two percent thereafter of the principal amount of the loan advanced to or for the direct benefit of the borrower, which fee may be included in the principal balance of the loan;

    (b) In connection with the making of a loan that is not secured primarily by real estate, charge the borrower a nonrefundable((, prepaid,)) loan origination fee not to exceed four percent of the first twenty thousand dollars and two percent thereafter of the principal amount of the loan advanced to or for the direct benefit of the borrower, which fee may be included in the principal balance of the loan;

    (3) Agree with the borrower for the payment of fees ((for title insurance, appraisals, recording, reconveyance, and releasing)) to third parties who provide goods or services in connection with the preparation of the borrower's loan, including, but not limited to, credit reporting agencies, title companies, appraisers, structural and pest inspectors, and escrow companies, when such fees are actually paid by the licensee to a third party for such services or purposes and may include such fees in the amount of the loan.  However, no charge may be collected unless a loan is made, except for reasonable fees properly incurred in connection with the appraisal of property by a qualified, independent, professional, third-party appraiser selected by the borrower and approved by the lender or in the absence of borrower selection, selected by the lender;

    (4) Charge and collect a penalty of ten cents or less on each dollar of any installment payment delinquent ten days or more;

    (5) Collect from the debtor reasonable attorneys' fees, actual expenses, and costs incurred in connection with the collection of a delinquent debt, a repossession, or a foreclosure when a debt is referred for collection to an attorney who is not a salaried employee of the licensee;

    (6) Make open-end loans as provided in this chapter;

    (7) Charge and collect a fee for dishonored checks in an amount approved by the director; and

    (8) In accordance with Title 48 RCW, sell insurance covering real and personal property, covering the life or disability or both of the borrower, and covering the involuntary unemployment of the borrower.

 

    NEW SECTION.  Sec. 2.  The department of financial institutions shall monitor the impact on consumers of removing the origination fee limit for real estate loans under this act, particularly the relationship between the interest rate charged and origination fees.  The department shall report to the financial institutions committees of the legislature by October 1, 2001.

 


                            --- END ---