Florida Senate - 2015                                    SB 1012
       By Senator Richter
       23-00852B-15                                          20151012__
    1                        A bill to be entitled                      
    2         An act relating to consumer loans; amending s.
    3         516.031, F.S.; providing terms for certain consumer
    4         loans made by licensees; specifying authorized amounts
    5         of certain fees and charges; authorizing a borrower to
    6         rescind an installment loan within a specified period;
    7         requiring the licensee to refund or credit the
    8         borrower certain charges under specified conditions;
    9         amending s. 516.07, F.S.; prohibiting a licensee from
   10         making payments to a person as a reward for referring
   11         loan applications to the licensee under certain
   12         circumstances; providing an effective date.
   14  Be It Enacted by the Legislature of the State of Florida:
   16         Section 1. Subsection (1) of section 516.031, Florida
   17  Statutes, is amended to read:
   18         516.031 Finance charge; maximum rates.—
   19         (1) INTEREST RATES.—
   20         (a) A licensee may lend any sum of money up to $25,000. A
   21  licensee may not take a security interest secured by land on any
   22  loan less than $1,000. The licensee may charge, contract for,
   23  and receive thereon interest charges as provided and authorized
   24  by this section. The maximum interest rate shall be 30 percent
   25  per annum, computed on the first $3,000 of the principal amount;
   26  24 percent per annum on that part of the principal amount
   27  exceeding $3,000 and up to $4,000; and 18 percent per annum on
   28  that part of the principal amount exceeding $4,000 and up to
   29  $25,000. The original principal amount as used in this section
   30  is the same as the amount financed as defined by the federal
   31  Truth in Lending Act and Regulation Z of the Board of Governors
   32  of the Federal Reserve System. In determining compliance with
   33  the statutory maximum interest and finance charges set forth
   34  herein, the computations used shall be simple interest and not
   35  add-on interest or any other computations. If two or more
   36  interest rates are applied to the principal amount of a loan,
   37  the licensee may charge, contract for, and receive interest at
   38  that single annual percentage rate which, if applied according
   39  to the actuarial method to each of the scheduled periodic
   40  balances of principal, would produce at maturity the same total
   41  amount of interest as would result from the application of the
   42  two or more rates otherwise permitted, based upon the assumption
   43  that all payments are made as agreed.
   44         (b) As an alternative to charging the rates set forth in
   45  paragraph (a), a licensee may provide a consumer installment
   46  loan of not less than $300 or more than $2,000 for a loan term
   47  that is not less than 6 months or more than 24 months where the
   48  licensee may charge:
   49         1. A one-time processing fee not to exceed the lesser of 10
   50  percent of the amount financed or $150; and
   51         2. An installment loan handling charge that does not
   52  exceed:
   53         a. Five dollars per $100 of the amount financed per month
   54  on an installment loan for loan amounts of at least $300 but not
   55  more than $500; or
   56         b. Four dollars per $100 of the amount financed per month
   57  on an installment loan for loan amounts of more than $500 but
   58  not more than $2,000.
   59         (c) No further charges are authorized in connection with an
   60  installment loan made pursuant to paragraph (b), except:
   61         1. Actual and reasonable attorney fees and court costs as
   62  determined by the court in which suit is filed.
   63         2. A delinquency charge of up to $15 for each payment that
   64  is in default for 10 days or more if the charge is agreed upon
   65  in writing between the parties at time the loan is made.
   66         3. A bad check charge as set forth in paragraph (3)(b).
   67         (d) A borrower may rescind an installment loan made under
   68  paragraph (b) by returning the amount of the loan to the
   69  licensee no later than the end of the 5th business day after the
   70  day on which the loan was made. Upon such return, the licensee
   71  shall promptly cancel the processing fee and the installment
   72  loan handling charge.
   73         (e) If the outstanding balance of an installment loan made
   74  pursuant to paragraph (b) is paid in full with cash, a new loan,
   75  or renewal of the existing loan at least 30 days before the date
   76  that the final installment is due, the licensee shall refund or
   77  credit to the borrower the unearned portion of any installment
   78  loan handling charge made in connection with the loan. The
   79  refund or credit shall be calculated according to the actuarial
   80  method from the date of the loan until the date the loan is paid
   81  in full.
   82         Section 2. Paragraph (k) of subsection (1) of section
   83  516.07, Florida Statutes, is amended to read:
   84         516.07 Grounds for denial of license or for disciplinary
   85  action.—
   86         (1) The following acts are violations of this chapter and
   87  constitute grounds for denial of an application for a license to
   88  make consumer finance loans and grounds for any of the
   89  disciplinary actions specified in subsection (2):
   90         (k) Paying money or anything else of value, directly or
   91  indirectly, to any person as compensation, inducement, or reward
   92  for referring loan applicants to a licensee if such amount is
   93  charged directly or indirectly to the borrower.
   94         Section 3. This act shall take effect July 1, 2015.