Effective State Changes
ARIZONA
In Arizona, HB 2292 was signed into law on June 19, 2023. This bill will allow for the electronic documentation of vehicles’ permanent records and vehicle sale contracts. The law also permits a dealer and buyer to cancel the sale if properly documented and submitted to the Department of Transportation. Effective January 1, 2024.
CONNECTICUT
On June 28, 2023, SB 1032 was signed into law and provides for new disclosure requirements in the context of commercial financing. The bill defines commercial financing as a sales-based financing transaction of $250,000 or less that is not intended to be used primarily for personal, household, or family purposes. Among the disclosures it requires: the financing amount, finance charges, total repayment, term, payments, and other potential fees. It also requires commercial financing lenders to register with the Department of Banking by October 1, 2024. Effective July 1, 2024.
SB 1033 was signed into law June 29, 2023, by Governor Ned Lamont. The new law modifies the types of charges and fees included in the “Finance Charge” for the purposes of performing a Military Lending Act Annual Percentage Rate (“MAPR”) calculation. The new language includes charges and fees “in connection or concurrent with a small loan.” SB 1033 also raises the maximum size of a covered small loan from $15,000 to $50,000. Additionally, this bill adds language regarding guaranteed asset protection (GAP) waivers. It clarifies that GAP waivers are not insurance and require a pro rata refund method upon cancellation. And finally, this bill changes the maximum amount covered for Retail Installment Sales Contracts for consumer goods—which includes motor vehicle sales—from $50,000 to $75,000. Effective in part July 1, 2023, and October 1, 2023.
FLORIDA
HB 1353 creates the Florida Commercial Disclosure Law and delegates the enforcement of the new law to the Attorney General. The bill establishes definitions and requirements for certain commercial financing transactions, including disclosure requirements. Additionally, the bill prohibits certain conduct from brokers engaged in arranging commercial financing transactions. Effective July 1, 2023.
GEORGIA
HB 55 amends and repeals certain laws in the state of Georgia regarding financing, banking, and international banking corporations. Among other provisions, one small amendment stood out as it affects Ga. Code Ann. § 7-3-11 (the Georgia Installment Loan Act). In the section discussing interest the lawmakers changed a shall, to a may: “On loan contracts repayable in 18 months or less, the interest may be discounted in advance; and, on contracts repayable over a greater period, the interest may be added to the principal amount of the loan. On all contracts, interest or discount shall be computed proportionately on equal calendar months.” Effective July 1, 2023.
HAWAII
SB 1534 changes the way that electric vehicles are registered in the state of Hawaii. The state currently charges a $50 registration fee for all electric vehicles. Beginning July 1, 2025, this will be replaced by a mileage-based usage charge of up to $50 annually for electric vehicles. Effective in part July 1, 2023, and July 1, 2025.
MISSOURI
Governor Mike Parson signed SB 398 into law on July 6, 2023. This bill revises the Motor Vehicle Franchise Practices Act to specifically exclude certain entities from selling vehicles in the state. Additionally, the bill changes how manufacturers compensate dealers for the cost of work related to warranties and other repairs. Effective August 28, 2023.
NORTH CAROLINA
SB 329—Session Law 2023-60—was vetoed and then overridden by the legislature on June 27, 2023. This new law reduces the number of finance charge brackets from four to two and changes the maximum finance charge rates for consumer credit installment sale contracts to 24% for loans less than $3,000 and 21% for loans $3,000 or greater. The law also makes changes to the maximum finance charge rate for consumer credit installment sales contracts for motor vehicles that are repayable in at least six installments. The amended rates are:
- 20% for vehicles one to three model years old
- 26% for vehicles four to five model years old
- 30% for vehicles six model years old and older
The bill updates the applicable late fees for retail sales or motor vehicle sales transactions from $15 to $18. Effective October 1, 2023.
SB 331 was vetoed and then overridden by the legislature on June 27, 2023. This bill amends the North Carolina Consumer Finance Act and outlines the rate of interest that may be charged on consumer finance loans. The bill removes the definition for “amount of the loan” and instead adds a definition for “amount financed.” Notably, this definition includes allowed fees, such as the processing fee, and therefore departs from the traditional TILA amount financed. It also changes the language in the computation of interest section to apply to the “amount financed” as opposed to “principal.” The bill changes the upper threshold from $15,000 to $25,000. The rate of interest depends on the amount of the loan. The threshold and rate changes are as follows:
| Before 10/1/23 |
After 10/1/23 |
| Maximum Loan Amount: $15,000 |
Maximum Loan Amount: $25,000 |
| Loans up to $10,000 (melded/blended rates): |
Loans up to $12,000 (melded/blended rates): |
| $0 – $4,000 |
30% |
$0 – $4,000 |
33% |
| > $4,000 – $8,000 |
24% |
> $4,000 – $8,000 |
24% |
| > $8,000 – $10,000 |
18% |
> $8,000 – $12,000 |
18% |
| Loans > $10,000 (up to $15,000): 18% |
Loans > $12,000 (up to $25,000): 18% |
Additionally, this bill changes the amount of processing fees a licensee could charge at closing. The processing fees under the bill cannot exceed $30 for any loan up to $3,000 (an increase from $25 for loans up to $2,500), and for any loan exceeding $3,000, the fee would continue to be 1% of the amount financed (excluding the processing fee), not to exceed $150 (up from $40). The bill increases the allowed late fee amount from $15 to $18. The bill also includes provisions related to licensing and record keeping. Effective October 1, 2023.
OREGON
HB 2100 is a transportation bill that updates fees for driver licenses, permits, identification cards, and the reinstatement of driving privileges. Additionally, this bill will increase the Document Preparation fees that motor vehicle dealers are allowed to charge. Dealers using an integrator may charge $250 (increased from $150) and must pay the integrator $35 (increased from $25). Dealers who do not use an integrator may charge $200 (increased from $115). Effective January 1, 2024.
RHODE ISLAND
HB 5537 and companion bill SB 830 were signed into law by Governor McKee on June 20, 2023. Both bills state that a licensed new motor vehicle dealer may now conduct inspections of vehicle identification numbers and submit them to the police department for clearance with the National Crime Information Center (NCIC). Dealers can charge $10 for this, but then must pass this on to the city or town whose police department conducts the NCIC check. Effective June 20, 2023.
SB 829 directs the administrator of the Rhode Island Division of Motor Vehicles to create a limited power of attorney form for vehicle registrations, as well as promulgate the rules and requirements for using this form to register a vehicle. Effective January 1, 2024.
In this new role, Hardisty will lead the support team that oversees all of Carleton’s clients that utilize those calculation solutions and document services. From the client onboarding process to ongoing support, she will ensure that Carleton’s clients are getting the support that they expect.