AN ACT TO MODERNIZE THE LOAN ORIGINATION FEE FOR NORTH CAROLINA BANKS AND TO ADJUST THE LATE PAYMENT CHARGE FOR CERTAIN LOANS.
Senate committee substitute makes the following changes to the 1st edition.
Deletes the content of the previous edition and replaces it with the following.
Amends GS 24-1.1 to limit bank loan origination fees for loans or extension of credit with a principal amount of $100,000 or greater to 1/4 of 1% of the principal amount and to an amount ranging from $150 to $250 for loans or extension of credit with a principal amount ranging from $0 to $99,999 (was, the origination fee could not exceed the greater of 1/4 of 1% of the outstanding balance or $50). Makes additional technical and clarifying changes.
Amends GS 24-10.1 to set the following limitations on late payment charges, which under current law are capped at 4% of the amount of the payment past due. A late payment charge must not exceed (1) the amount disclosed with particularity to the borrower under the Federal Consumer Credit Protection Act, if applicable; (2) for a loan or extension of credit that meets all of the following conditions, the greater of $35 or 4% of the amount of the payment past due: the loan or extension of credit is made by a bank or savings institution organized under the law of this state or the United States, the loan or extension of credit is not secured by real property, and the loan or extension of credit is governed by GS 24-1.1. Limits the charge to 4% of the amount of the payment past due for any other type of loan or extension of credit governed by GS 24-1.1 (concerning a loan, purchase money loan, advance, commitment for a loan or forbearance) or GS 24-1.1A (concerning home loans). Makes additional organizational, clarifying, and technical changes.
Effective October 1, 2018, and applies to contracts entered into, renewed, or modified on or after that date.
Makes conforming changes to the act's titles.
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