Effective State Changes

NEW YORK

SB 4104A enacts the “Digital Fair Repair Act.” Signed into law by Governor Kathy Hochul on December 28, 2022, this new bill requires original equipment manufacturers to make diagnostic and repair information for digital electronic parts and equipment available to independent repair providers and consumers if such parts and information are provided to their own authorized repair providers. Effective December 28, 2023.

OHIO

SB 249 was signed into law on December 13, 2022. This bill creates a regulatory sandbox for novel financial services or products in the State of Ohio. Effective March 14, 2023.

Effective Federal Changes 

CONSUMER FINANCIAL PROTECTION BUREAU

Threshold Adjustment for Determining Exempt Transactions Re: Special Appraisal Requirements for Higher-Risk Mortgages under Reg. Z.—The Consumer Financial Protection Bureau and the Federal Reserve Board issued final rules amending the Regulation Z provision implementing Section 129H of the Truth in Lending Act, which establishes special appraisal requirements for higher-risk mortgages, dubbed higher-priced mortgage loans (HPMLs). The threshold for exempting loans from special appraisal requirements for HPMLs increased to $31,000 for 2023, up from $28,500 for 2022. Loans under the threshold amount will not be subject to the special appraisal requirements, such as the creditor obtaining a written appraisal based on a physical visit to the interior of the home before making a higher-priced mortgage loan. Effective January 1, 2023.

Specific dollar threshold adjustments were announced through the Consumer Protection Financial Bureau. The CPFB is required to make adjustments to dollar thresholds based on annual changes in the Consumer Price Index. Updates to the Ability to Repay/ Qualified Mortgage Rule, (“ATR/QM”) and Home Ownership Equity Protection Act (“HOEPA”), among others, were announced and become effective January 1, 2023.

HOEPA Annual Threshold Adjustments

• The adjusted total amount of the loan threshold will be $24,866, up from $22,969
• The adjusted points and fees trigger will be $1,243, up from $1,148

ATR/QM Threshold Adjustments

To meet qualified mortgage criteria, the combined points and fees cannot exceed the following:

• 8% of total loan amount for loans less than $15,541
• $1,243 for loans greater than or equal to $15,541 but less than $24,866
• 5% of total loan amount for loans greater than or equal to $24,866 but less than $74,599
• $3,730 for loans greater than or equal to $74,599 but less than $124,331
• 3% of total loan amount for loans greater than or equal to $124,331

In Case You Missed It 

ILLINOIS

The document preparation fee in the State of Illinois increased to $347.26. Effective January 1, 2023.

MICHIGAN

The document preparation fee in the State of Michigan has been adjusted to be the lesser of $260 or 5% of the cash price for 2023 and 2024. Effective January 13, 2023.

PENNSYLVANIA

The document preparation fee in the State of Pennsylvania for 2023 increased to $449 for electronic filings and $374 for non-electronic filings. Effective January 1, 2023.

Review of State Changes Effective in 2022

ALABAMA

HB 335 allows a Small Loan licensee to collect a closing fee of $50 or 4% of the loan amount, whichever is less, amongst other provisions. Effective March 29, 2022.

SB 52 revises the language surrounding Alabama’s warranty services for motor vehicle dealers. Effective June 1, 2022.

ARKANSAS

SB 225 updates registration fees for plug-in electric vehicles to $100 and hybrid electric vehicles to $50. Effective January 1, 2022.

HB 1912 provides a reduced sales and use tax rate for certain used motor vehicles, trailers, and semitrailers. Effective January 1, 2022.

CALIFORNIA

AB 1221 specifies that a service contract may be offered on a month-to-month or other periodic basis and continued until canceled by the buyer. Effective January 1, 2022.

COLORADO

On May 11, the Colorado Department of Regulatory Agencies, Division of Insurance amended credit insurance regulation 3 CCR 702 Reg. 4-9-2. Effective July 15, 2022.

SB 223 allows motor vehicle dealers to deliver vehicles, documents, and test-drive vehicles away from its principal place of business. Effective August 10, 2022.

DELAWARE

HB 429 clarifies that a GAP waiver is exempt from insurance regulation. Effective October 14, 2022.

FLORIDA

HB 749 allows for canceling the renewal of a service contract in the same manner as the contract was purchased. Effective June 3, 2022.

SB 546 prohibits a licensee from charging a prepayment penalty for paying back all or part of a loan principal before it is due. Effective October 1, 2022.

GEORGIA

HB 63 alters the alternative ad valorem tax on motor vehicles. Effective January 1, 2022.

HB 733 allows property insurance and GAP waivers to provide compensation if there is an accident, loss, or stolen vehicle. Effective July 1, 2022, in part, and January 1, 2023.

HB 891 obligates a new 0.125% fee on the gross loan amount for every new installment loan under the Georgia Installment Loan Act, which shall be paid by the licensee. Effective July 1, 2022.

HAWAII

HB 1192 created a new small dollar installment loan scheme for loans up to $1,500. Bill effective July 1, 2021; licensing requirements effective January 1, 2022.

ILLINOIS

The document preparation fee in the State of Illinois increased from $303.60 to $324.24. Effective January 1, 2022.

SB 58 restores the full sales tax trade-in credit on vehicle trade-ins. Effective January 1, 2022.

INDIANA

Bulletin 262 adjusts the credit life rates. Effective January 1, 2022.

SB 383 requires the retail value for a used motor vehicle be established by a third-party valuation provider to determine GAP coverage. Effective July 1, 2022.

IOWA

Iowa released new regulations increasing the special annual registration fees for electric vehicles. Effective January 1, 2021, and January 1, 2022.

KENTUCKY

SB 91 allows for established motor vehicle dealers to deliver vehicles purchased on the internet to customers at their request. Effective July 14, 2022.

MASSACHUSETTS

On February 10, 2022, the Office of Consumer Affairs and Business Regulation released a letter stating a consumer may not be charged a cancellation fee for GAP waiver products.

MICHIGAN

Bulletin 2022-02-CF stated that the loan processing fee amount will remain at $400 from January 1, 2022 – December 31, 2023.

MINNESOTA

The Commerce Department published their periodic adjustment in dollar brackets, effective July 1, 2022.

NEW JERSEY

AB 5033 authorizes motor vehicle dealers to sell vehicles online provided they meet certain physical requirements for their business premises. Effective January 18, 2022.

NEW YORK

SB 4894 amends the law in New York requiring mail-loan checks to include any transaction fees and interest rates on the check. Effective September 2, 2022.

SB 898 amends A10118-A/S05470B and exempts transactions of at least $50,000 for auto dealers from commercial financing disclosures. Effective January 1, 2022.

NORTH CAROLINA

SB 425 changes current statutes governing GAP waivers. Effective January 1, 2022.

OKLAHOMA

SB 1687 specifically addresses 3-508B dollar bracket adjustments under the UCCC and ties the Consumer Price Index to December 2021. Effective November 1, 2022.

SB 1743 amends current law to allow financial protection products for motor vehicles to be offered, sold, or given to consumers. Effective November 1, 2022.

OREGON

Regulation 125958 establishes a rebate program for zero-emission vehicles in Oregon. Effective May 19, 2022.

PENNSYLVANIA

Pennsylvania’s maximum allowed document preparation fee for 2022 is either $351 or $422 (if electronically filed). Effective January 1, 2022.

RHODE ISLAND

HB 7781 and companion bill SB 2794, revises Title 19 to expand the definition of “Licensed Activities” to include retail installment sales. Effective June 29, 2022.

SOUTH CAROLINA

Orders 2021-02, 2021-03, and 2021-04 were adopted by the Department of Insurance for Prima Facie Credit A&H and Credit Property rates. Effective January 1, 2022.

The Department of Consumer Affairs released its biannual dollar bracket adjustment effective from July 1, 2022, through June 30, 2024. Effective July 1, 2022.

SOUTH DAKOTA

SB 160 exempts service contracts from the insurance code and defines theft protection products and items covered under its warranties. Effective July 1, 2022.

HB 1082 extends the motor vehicle excise tax on vehicles leased for more than twenty-eight days to include certain off-road vehicles. Effective July 1, 2022.

TEXAS

Released in January 2022, the dollar brackets and ceilings will increase for Consumer Loans and Retail Installment Contracts. Effective July 1, 2022.

UTAH

SB 183 requires certain financing entities register with the Department of Financial Institutions, amongst other provisions. Effective May 4, 2022.

VIRGINIA

The Order Adopting Adjusted Prima Facie Rates for the Triennium Commencing January 1, 2022, enacts new rates for a 3-year period. Effective January 1, 2022.

HB 1027 mandates that certain commercial financing providers register with the Commonwealth of Virginia’s State Corporation Commission. Effective July 1, 2022.

HB 259 and SB 216 are identical bills that alter the compensation from manufacturers and distributors for recall and warranty parts and service. Effective July 1, 2022.

WASHINGTON

SB 5000 reduces taxes by 50% on fuel-cell powered passenger cars, light duty trucks, and medium duty passenger vehicles powered by a fuel cell. Effective July 1, 2022.

SB 5974 raises the Documentary Service Fee motor vehicle dealers can charge from $150 to $200. Effective July 1, 2022.

WEST VIRGINIA

HB 4567 eliminates the municipal business and occupation or privilege tax for motor vehicle dealers over a three-year period. Effective June 9, 2022.

WYOMING

HB 64 defines theft protection programs, theft protection program warranties, and specifies that they are not insurance. Effective July 1, 2022.

Review of State Changes Effective in 2023 and Beyond

ALABAMA

SB 48 provides that a GAP waiver may offer provisions which waive a certain amount or provide credit towards a replacement vehicle. Effective January 1, 2023.

CALIFORNIA

Proposition 24 expands consumer privacy protections. Effective January 1, 2023.

AB 2001 allows licensees under the California Financing Law to designate employees who work remotely. Effective January 1, 2023.

AB 2956 allows for the suspension of a motor vehicle dealer license for a number of defined reasons. Effective January 1, 2023.

AB 2311 creates a number of new requirements for GAP waiver products under which a seller agrees to cancel or waive amounts due on the buyer’s sale contract. Effective January 1, 2023.

AB 1904 makes it a violation of California law to not present certain disclosures to a consumer of certain financial products. Effective January 1, 2023.

AB 2912 makes a product’s delivery date the starting date for any express warranty offered by a manufacturer, distributor, or retail seller. Effective January 1, 2023.

SB 1311 is the Military and Veteran Consumer Protection Act of 2022 and provides new and enhanced protections to servicemembers. Effective January 1, 2023.

AB 984 authorizes alternative license plates, stickers, tabs, and registration cards. Effective January 1, 2023.

AB 1871 states that vehicle history reports must include information for the vehicle buyer to be able to contact the reporting business or agency. Effective January 1, 2023.

ILLINOIS

The document preparation fee in the State of Illinois increased to $347.26. Effective January 1, 2023.

KENTUCKY

HB 284 allows for the Kentucky Transportation Cabinet to establish an electronic title application and registration system. Effective date January 1, 2024.

HB 8 increases the county registration and renewal fees for electric vehicles to $120 and for hybrid vehicles to $60. Effective January 1, 2023.

LOUISIANA

HB 1031 imposes a road usage fee in the amount of $110 per year for electric vehicles and $60 per year on hybrid vehicles. Effective January 1, 2023.

MICHIGAN

The document preparation fee in the State of Michigan has been adjusted to be $260 or 5% of the cash price for 2023 and 2024. Effective January 13, 2023.

NEW JERSEY

SB 324 directs the New Jersey Motor Vehicle Commission to promulgate rules for electronic registration certificates. Effective May 1, 2023.

SB 902 imposes certain consumer protection requirements on service contract providers. Effective August 1, 2023.

NEW MEXICO

HB 132 enacts a 36% TILA APR rate cap for small dollar loans in New Mexico. Effective January 1, 2023.

PENNSYLVANIA

The document preparation fee in the State of Pennsylvania for 2023 increased to $449 for electronic filings and $374 for non-electronic. Effective January 1, 2023.

SOUTH CAROLINA

South Carolina Department of Insurance adopted Orders confirming Prima Facie Credit A&H and Credit Property insurance rates for 2023. Effective January 1, 2023.

UTAH

HB 186 raises the registration and renewal fees for plug-in hybrid vehicles and hybrid electric vehicles. Effective January 1, 2023.

Review of Federal Changes Effective in 2022

CONSUMER FINANCIAL PROTECTION BUREAU

Dollar threshold adjustments were announced for the Ability to Repay/ Qualified Mortgage Rule and HOEPA. Effective January 1, 2022.

The CFPB published its annual TILA threshold adjustment, as required by the Dodd-Frank Act. Effective January 1, 2022.

The CFPB delayed the mandatory compliance date for the new qualified mortgage (QM) final rule. The new effective date is October 1, 2022.

Review of Federal Changes Effective in 2023

CONSUMER FINANCIAL PROTECTION BUREAU

The CFPB published TILA threshold adjustments for Regulation M and Z from $61,000 to $66,400. Effective January 1, 2023.

FEDERAL TRADE COMMISSION

The FTC announced on November 15, 2022 that it was extending the compliance deadline for the revised Safeguards Rule by six months. Effective June 9, 2023.

Effective State Changes

CALIFORNIA        

SB 1193 authorizes the California DMV to send electronic notifications to citizens regarding their vehicles. Effective January 1, 2023.

MICHIGAN

SB 1064 was signed into law by Governor Whitmer on October 14, 2022. Among other provisions, the bill requires a new vehicle dealership to meet certain requirements before opening, such as: posting signage of operating hours, not locating within two hundred feet of another licensed dealer, and maintaining all books and records necessary to conduct business on site. Effective January 23, 2023.

WASHINGTON, D.C.

Approved by Mayor Muriel Bowser on July 27, 2022, B24 457/Act 24-0529 was sent for congressional review on August 9th. The bill has a projected enactment date of November 10, 2022. The bill authorizes and regulates remote notarizations. Effective November 10, 2022.

FEDERAL TRADE COMMISSION

The FTC voted and announced on November 15, 2022 that it was extending the compliance deadline for the revised Safeguards Rule by six months. The updated Safeguards Rule addresses the use and protection of customer’s personal data including requiring two-factor authentication and the creation of an incident response plan. The new effective date for compliance will be June 9, 2023.

Effective State Changes

CALIFORNIA

California AB 2960 was signed by Governor Gavin Newsom on September 18, 2022. This new law removes a January 1, 2023, repeal date and extends indefinitely a self-service storage facility owner’s authority to send a lien notice and other documentation via electronic mail when terminating the right of an occupant to the use of the storage space due to rent or other charges being unpaid for 14 consecutive days. Effective January 1, 2023.

On September 26, 2022, Governor Newsom signed into legislation AB 2380 which prohibits online pet retailers from offering or facilitating a loan or financing for the adoption or sale of a dog, cat, or rabbit. Effective January 1, 2023.

Governor Newsom signed AB 2912 into law on September 22, 2022. This law effectively makes a product’s delivery date the starting date for any express warranty offered by a manufacturer, distributor, or retail seller. Effective January 1, 2023.

The Military and Veteran Consumer Protection Act of 2022 (SB 1311) was signed into law by Governor Newsom on September 27, 2022, and provides new and enhanced protections to servicemembers. Amongst those protections, the bill provides that a security interest in personal property is void and cannot be perfected if it would cause a loan procured by a covered member in the course of purchasing the personal property to be exempt from the requirements of the federal Military Lending Act and, in the case of a security interest in a motor vehicle, if the loan also funds the purchase of a credit insurance product or credit-related ancillary product. Effective January 1, 2023.

Approved by the Governor on September 29, 2022, AB 984 makes permanent a pilot program authorizing the California Department of Motor Vehicles (“DMV”) to issue alternative license plates, stickers, tabs, and registration cards. The new law also provides an option for alternative plates with GPS-tracking technology for fleet vehicles, commercial vehicles and vehicles operating under an occupational license. Effective January 1, 2023.

On September 30, 2022, the Governor signed AB 1871 into law. Under this bill, vehicle history reports must include contact information for the vehicle buyer to contact the reporting business or agency. Among other provisions, it provides a cause of action for a buyer to bring against any report provider who does not comply with this statute. Effective January 1, 2023.

AB 2594 will now require the DMV to refuse the renewal of a person’s vehicle registration if they fail to pay toll fees or late fees. Effective January 1, 2023.

SB 1193 authorizes the California DMV to send electronic notifications to citizens regarding their vehicles. Effective January 1, 2023.

DELAWARE

HB 429 clarifies that a guaranteed asset protection waiver is exempt from insurance regulation. Effective immediately.

MICHIGAN

SB 1064 was signed into law by Governor Whitmer on October 14, 2022. Among other provisions, the bill requires a new vehicle dealership to meet certain requirements before opening, such as: posting signage of operating hours, not locating within two hundred feet of another licensed dealer, and maintaining all books and records necessary to conduct business on site. Effective January 23, 2023.

SOUTH CAROLINA

On October 14, 2022, the South Carolina Department of Insurance adopted Orders 2022-01, 2022-02, and 2022-03 confirming Prima Facie Credit A&H and Credit Property insurance rates for 2023. Under 2022-01, the Credit A&H rates for insurance sold in conjunction with consumer credit transactions in 2023 will remain the same as current rates in 2022. The 12-month rate per $100 of Initial Insured Indebtedness will be as follows:

• 14-day Retro: $1.38
• 30-day Retro: $1.30

Under Order 2022-02, the 3-day retroactive A&H rate for insurance sold in conjunction with loans will remain $0.25 per $5.00 of monthly indemnity. Under Order 2022-03, credit property rates have decreased for Automobile Fire and Theft, Automobile Collision, and Household Goods – Dual Interest. The rate for Household Goods – Single Interest remains the same. Effective January 1, 2023.

OKLAHOMA

Senate Bill 1687 changes the upper threshold for Section 3-508B loans to $3,000. The bill also adds three new tiers for loans greater than $1,620. Effective November 1, 2022.

CFPB – ANNUAL REGULATION M & Z ADJUSTMENTS

The Consumer Financial Protection Bureau (“CFPB”) published its annual Truth in Lending Act threshold adjustment, as required by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. For 2023, the exemption threshold amount for Regulation M and Z will increase from $61,000 to $66,400. Effective January 1, 2023.

Effective State Changes

CALIFORNIA

Governor Gavin Newsom signed AB 2001 on August 26, 2022. This law allows licensees under the California Financing Law to designate employees who work remotely, so long as a consumer’s personal information is stored on an encrypted device or media in that location. Effective January 1, 2023.

On September 13, 2022, Governor Newsom approved AB 2956. The provisions in this bill allow for the suspension of a motor vehicle dealer license for a number of reasons, like abandoning a principal place of business, the cancelation or suspension of corporate status, or if the licensee’s seller’s permit is suspended, revoked, or canceled by the Department of Tax and Fee Administration. Effective January 1, 2023.

California AB 2311was enacted by the Governor on September 13, 2022. This act creates a number of new contractual obligations under which the seller agrees to cancel or waive all or part of amounts due on the buyer’s sale contract. Among other provisions, the law:

• Prohibits the sale of a GAP waiver where the loan-to-value ratio exceeds the maximum loan-to-value ratio of 4% of the underlying loan’s principal;
• Contains specific rules for the refund of GAP waiver amounts at termination;
• Allows the buyer to recover three times the amount of GAP charges if a holder of a contract includes GAP waiver;
• Defines a GAP waiver as optional and conditional to the sale contract;
• Creates a restriction that the purchase of a GAP waiver cannot be required to get a loan, particular loan terms, or a certain price;
• Requires that the cost of the GAP waiver must be a separately stated add-on item;
• Requires that the name and mailing address of any third-party GAP waiver administrator known at the date of the sale.

Effective January 1, 2023.

California AB 1904 was signed on September 15th. It states that it is a violation of California law to not present certain disclosures to a consumer of financial products like debt settlement agreements or within advertising from student loan debt relief providers and credit repair companies. Effective January 1, 2023.

NORTH CAROLINA

Governor Roy Cooper signed HB 776 on July 8, 2022. Following trends seen throughout the pandemic, this law allows notaries to perform online notarial acts. Effective July 1, 2023.

RHODE ISLAND

HB 7781 was enacted on June 29, 2022, by Governor Daniel McKee. This bill allows employees of licensed financial institutions to work remotely, and also requires loan originators and mortgage brokers to pay a fee and license with the Nationwide Multistate Licensing System. Effective immediately.

Effective State Changes

DELAWARE

HB 481 was signed into law on August 4, 2022. The act increases consumer protections for students enrolled in private postsecondary schools for student loans, distance learning, and defines other predatory practices. Effective immediately.

HAWAII

HB 1411 requires that the transferee’s and transferor’s address be provided on the certificate of ownership when a title to a motor vehicle is exchanged and imposes a fine for providing false or fraudulent information. Effective July 1, 2022.

MICHIGAN

SB 706 creates the Michigan Council of Future Mobility to analyze the development and creation of an automated vehicle roadway, automated vehicle roadway system, or other related infrastructure. The bill empowers the Michigan Department of Transportation (“MDOT”) to designate a segment of a roadway as an automated vehicle roadway and charge a fee for its use. Additionally, MDOT must report to the House and Senate an update on automated vehicle roadways by July 25, 2023, and thereafter every two years. Effective July 25, 2022.

NEW JERSEY

SB 902 was signed on August 5, 2022. This bill imposes certain consumer protection requirements on service contract providers. When the service contract is a home warranty or extended warranty, the provider must disclose that the product being offered is separate from any product, service warranty, or extended warranty which may be provided by a home builder or manufacturer. Effective August 1, 2023.

RHODE ISLAND

HB 6645 extends the period of time a motor vehicle purchaser may temporarily use their old license plates ten days, for a total of 30 days. Effective immediately.

Effective State Changes

COLORADO

HB 1359 was approved on June 3, 2022, and enacts the Colorado Household Financial Recovery Pilot Program Act, an act focused on supporting Colorado individuals and households impacted by the COVID-19 Pandemic. The act outlines requirements for making loans under this Pilot Program. Effective June 3, 2022.

HB 1410 allows Lenders to authorize work from remote locations, provided certain requirements are followed. Effective 90 days following adjournment, unless a referendum is filed.

FLORIDA

HB 389 revises some of the licensing requirements for licensure as a money services business. Effective October 1, 2022.

ILLINOIS

HB 5220 modifies the Financial Institutions Code by changing the definition of “Financial institutions” to include “consumer installment lenders, payday lenders, sales finance agencies, and any other industry or business that offers services or products that are regulated under any Act administered by the Director.” The act clarifies the Division of Financial Institutions of the Department’s supervisory authority. The act further addresses collection agency requirements and violations. Effective January 1, 2023.

LOUISIANA

HB 610 clarifies definitions and duties relating to student loan servicers. In a similar vein, HB 789 clarifies definitions and requirements for a “private education lender.” Effective August 1, 2022.

HB 1031 imposes a road usage fee in the amount of $110 per year for electric vehicles and $60 per year on hybrid vehicles. Effective January 1, 2023.

MARYLAND

HB 962 and SB 643 are companion bills that address data security standards and security breach notice requirements for businesses that receive and maintain personal information of Maryland residents. Effective October 1, 2022.

OKLAHOMA

Oklahoma HB 3419 creates Service Oklahoma, a division of the Office of Management and Enterprise Services. Among other duties, Service Oklahoma takes over the powers, duties and responsibilities previously exercised by the Driver License Services Division of the Department of Public Safety and the Motor Services Division of the Oklahoma Tax Commission. The act changes references to a “motor license agent” to “licensed operator.”  Effective in part January 1, 2023.

OREGON

Regulation 125958 establishes a rebate program for zero-emission vehicles in Oregon. The regulation removes the previous expiration date of January 2, 2024. Effective May 19, 2022.

RHODE ISLAND

The fiscal bill, HB 7123, repeals the motor vehicle and trailer excise tax. Effective July 1, 2022. However, the motor vehicle and trailer excise tax for the city of East Providence shall continue until July 1, 2023.

HB 7781 and companion bill SB 2794, revise Title 19 of the General Laws of Rhode Island to expand the definition of “Licensed Activities” to specifically include retail installment sales. Effective June 29, 2022.

KENTUCKY

House Bill 8 imposes a number of new taxes and increases the county registration and renewal fees for electric vehicles to $120 and for hybrid vehicles to $60. We had previously published the county registration and renewal fees were effective immediately and the fees for electric vehicles were $140 and for hybrid vehicles $70. Effective January 1, 2023.

Effective State Changes

COLORADO

House Bill 1351 delays the implementation of higher road safety surcharges and road usage fees set to go in effect on July 1, 2022, and moves the effective dates to January 1, 2024, and April 1, 2023, respectively. Effective immediately.

On June 8, 2022, Governor Jared Polis signed Senate Bill 179 into law. This law allows a motor vehicle dealer to lose their license if the exhaust emissions parts are altered on a new vehicle. Effective August 10, 2022.

Senate Bill 223 was signed into law on June 7, 2022 and will allow motor vehicle dealers to deliver sold vehicles, documents, and test-drive vehicles away from its principal place of business. Effective August 10, 2022.

FLORIDA

House Bill 749 was signed by Governor Ron DeSantis on June 3, 2022. Amongst other provisions, the act allows for canceling the renewal of a service contract in the same manner as the contract was purchased. Effective immediately.

Senate Bill 546 was enacted on June 23, 2022. The bill amends the Florida Consumer Finance Act and prohibits a licensee from charging a prepayment penalty for paying back all or part of a loan principal before it is due. The bill also states what assets or other surety bonds, or certificates of deposit are necessary to make a loan under the Act. Effective October 1, 2022.

GEORGIA

Governor Brian Kemp signed House Bill 891 on May 2, 2022. Amongst other items regarding the servicing of loans made under the Georgia Installment Loan Act, this law obligates a new 0.125% fee on the gross loan amount for every new installment loan, refinance of an installment loan, or modification of any loan resulting in a new or amended agreement. This fee must be paid by the licensee and not charged to the borrower. Effective July 1, 2022.

KENTUCKY

House Bill 8 was vetoed on April 8, 2022, but the bill was overridden by the House and Senate on April 13, 2022. The bill imposes a number of new taxes and increases the county registration and renewal fees for electric vehicles to $140 and for hybrid vehicles to $70. Effective immediately.

MINNESOTA

Signed into law on June 2, 2022, by Governor Tim Walz, House File 3255 clarifies unlawful and unfair practices which car dealer manufacturers, distributors, and their affiliated entities are prohibited in engaging in with their franchise vehicle dealers. Effective August 1, 2022.

MISSOURI

House Bill 2416 will now allow motor vehicle dealers to conduct sales and other activities away from their registered place of business. Effective August 28, 2022.

NEW HAMPSHIRE

Senate Bill 442 requires the New Hampshire DMV to suspend registration privileges until all unpaid tolls and administrative fees are paid by the offender. It also prohibits the sale of said vehicle until those tolls and fines are paid as well. Effective January 1, 2023.

WASHINGTON

Senate Bill 5974 raises the Documentary Service Fee motor vehicle dealers can charge from $150 to $200. Effective July 1, 2022.

COLORADO

Colorado published Credit Insurance rate adjustments. Effective July 15, 2022.

OKLAHOMA

The Department of Consumer Credit published the changes in dollar brackets for Retail Installment Sales and Consumer Loans. Effective July 1, 2022.

SOUTH CAROLINA

The Department of Consumer affairs has updated their Supervised Loans and Consumer Credit Sales dollar brackets. Effective July 1, 2022.

TEXAS

The Texas Office of Consumer Credit Commissioner published dollar amount brackets and ceilings subject to adjustment in the Texas Financial Code for Retail Installment Sales and Consumer Loans. Effective July 1, 2022.

Effective State Changes

COLORADO

On May 11, 2022, the Colorado Department of Regulatory Agencies, Division of Insurance amended credit insurance regulation 3 CCR 702 Reg. 4-9-2. The amendments renamed the regulation “Credit Insurance for Life, Accident and Health, and Property and Casualty”, altered refund policies, updated the filing requirements for rate submissions, and contains a new Appendix A that is a Summary of Component-Based Rates, among other provisions. The prima facie life and A&H rates do not apply to credit union accounts. Among the rate adjustments are:

Single Premium Gross Life Only rates:

• Single Decreasing Life (SDL)                            $.49/$100/yr
• Single Level Life (SLL)                                        $.90/$100/yr
• Joint Decreasing Life (JDL)                               $.809/$100/yr (165% of single rate)
• Joint Level Life (JLL)                                          $1.485/$100/yr (165% of single rate)

Single Premium Net Payoff and MOB Life coverage Rates:

• Single Life                                                             $.75/$1000/mo
• Joint Life                                                               $1.238/$1000/mo (165% of single rate)

Single Premium IUI Rates:   30 Retro 9 Month Benefit

• Without Family Leave                                        $4.62/$100/yr

Effective July 15, 2022.

GEORGIA

House Bill 733 was signed into law on May 6, 2022. Among many provisions, the new bill changes the definition of property insurance and guaranteed asset protection waivers to provide for compensation or a reduction in financing charges in the event of an accident, total loss, or stolen motor vehicle. Effective July 1, 2022, in part, and January 1, 2023.

HAWAII

House Bill 153 was adopted on April 7, 2022, and urges Hawaii’s counties to allow for vehicle registration taxes and fees to be paid on a pro-rated semi-annual basis. Effective immediately.

NEBRASKA

On April 18, 2022, Governor Pete Ricketts signed Legislative Bill 750 into effect. The bill makes technical corrections, revises numerous provisions related to enforcement dates, and gives the Director of the Nebraska DMV the ability to register apportioned vehicles for monthly, quarterly, or yearly renewal periods. Effective immediately.

NEW YORK

Governor Kathy Hochul signed Senate Bill 4894 on May 5, 2022. The bill amends the law in New York regarding mail-loan checks to include any transaction fees and interest rates on the check, prohibits lending institutions from issuing these checks unless requested, and provides that failure to destroy or return a mail-loan check is not an acceptance of its terms. Effective September 2, 2022.

OKLAHOMA

The Department of Consumer Credit published the changes in dollar amounts which will become effective July 1, 2022. Included in the adjustments are the following:

Retail Installment Sales, §2-201:

The greater of:

• 30% of the amount financed up to $1,740; plus
• 21% of the excess to $5,800; plus
• 15% of the remainder to $61,000.

OR

• 21% Simple Interest

The dollar amounts under §3-508A remain the same, except for the new loan closing fee permitted under §3-508A(4). The allowed closing fee changes from $28.85 originally specified under SB 796 and increases the allowable charge to $167.33.

For loans subject to § 3-508B of the Oklahoma Code the maximum charge structure is:

Loan Amount	Acquisition Charge	Handling Charge
Up to $173.94		$5.80 per $29.00 of principal
$173.94-$203.00	1/10 of the amount of principal	$17.40 per month
$203.01-$406.00	1/10 of the amount of principal	$20.30 per month
$406.01-$580.00	1/10 of the amount of principal	$23.20 per month
$580.01-$870.00	1/10 of the amount of principal	$26.10 per month
$870.01-$1,160.00	1/10 of the amount of principal	$29.00 per month
$1,160.01-$1,450.00	1/10 of the amount of principal	$31.90 per month
$1,450.01-$1,740.00	1/10 of the amount of principal	$34.80 per month

The maximum delinquency charge for consumer credit sales and consumer loans will increase from $27.00 to $29.00. Effective July 1, 2021.

Senate Bill 1276 directs the Oklahoma Tax Commission to create a program to allow electronic filing, storage, and delivery of boat and vehicle certificates of title. The program will also allow lienholders to perfect, assign, and release a lien on a boat or vehicle in lieu of submission and maintenance of paper documents. Effective July 1, 2022.

Senate Bill 1687 specifically addresses 3-508B dollar bracket adjustments under the Uniform Consumer Credit Code and ties the Consumer Price Index to the December 2021 Index. The bill changes the upper threshold for Section 3-508B loans to $3,000. The bill also adds three new tiers for loans greater than $1,620 (the highest tier in effect as of November 1, 2021). We note that SB 1687 appears to use the dollar amounts in effect as of November 1, 2021, but doesn’t adjust for the dollar amounts effective as of July 1, 2022. The dollar amount adjustment effective July 1, 2022, as put forth by the Department of Consumer Credit, does not include the bottom three tiers. The dollar amounts, as stated in SB 1687 are:

Loan Amount	Acquisition Charge	Handling Charge
Up to $161.95		$5.40 per $27.00 of principal
$161.95-$189.00	1/10 of the amount of principal	$16.20 per month
$189.01-$378.00	1/10 of the amount of principal	$18.90 per month
$378.01-$540.00	1/10 of the amount of principal	$21.60 per month
$540.01-$810.00	1/10 of the amount of principal	$24.30 per month
$810.01-$1,080.00	1/10 of the amount of principal	$27.00 per month
$1,080.01-$1,350.00	1/10 of the amount of principal	$29.70 per month
$1,350.01-$1,620.00	1/10 of the amount of principal	$32.40 per month
$1,620.01-$2,000.00	1/10 of the amount of principal	$40.00 per month
$2,000.01-$2,500.00	1/10 of the amount of principal	$50.00 per month
$2,500.01-$3,000.00	1/10 of the amount of principal	$60.00 per month

Effective November 1, 2022.

Senate Bill 1743 amends current law to allow financial protection products for motor vehicles to be offered, sold, or given to consumers. Furthermore, the bill defines these products as an agreement not to be considered insurance and directs the Insurance Commissioner to draft new rules to enforce of the act. Effective November 1, 2022.

TEXAS

Released in January 2022, the dollar amount brackets and ceilings subject to adjustment in the Texas Financial Code will increase as follows:

Consumer Loans – §342.201

(Add-On Rates)

$18 per $100 per annum of the cash advance to $2,400 plus,

$  8 per $100 per annum of the excess to $20,000

OR

(Simple Melded Rates)

30% per annum of the cash advance to $4,000 plus,

24% of the excess to $8,400 plus,

18% of the remainder to $20,000

Retail Installment Sales (“Other Goods”) – §345.055

$12 per $100 per annum of the principal balance to $4,000 plus,

$10 per $100 per annum of the excess to $8,000 plus,

$  8 per $100 per annum of the remainder.

Effective July 1, 2022.

VIRGINIA

House Bill 259 and Senate Bill 216 are identical bills that were passed following Governor Youngkin’s recommendations. This law alters the current law for motor vehicle franchisees which only provides compensation from manufacturers and distributors for recall and warranty parts and service. Now, those franchisees will receive compensation from maintenance parts and service and body-shop repairs. Effective July 1, 2022.

Effective State Changes

ALABAMA

House Bill 91 will now allow county officials to contract with a third-party vendor for vehicle print-on-demand validation decals, emblems, and registration receipts. Effective April 5, 2022.

Governor Kay Ivey signed House Bill 335 into law on March 29, 2022. The amended law now allows a licensee making Small Loans under Ala. Code § 5-18, to collect a closing fee of $50 or 4% of the loan amount, whichever is less. This fee may be paid from the proceeds and financed. Upon full prepayment of any loan under Ala. Code § 5-18, any closing fee collected is subject to the refund provisions of the act, however the licensee may retain up to $25 of the closing fee. Effective immediately.

Senate Bill 48 provides that a guaranteed asset protection (“GAP”) waiver may offer provisions which waive a certain amount or provide credit towards a replacement vehicle. The bill also allows for an excess wear and use waiver for lease agreements. Effective January 1, 2023.

Signed by Governor Ivey on March 1, 2022, Senate Bill 52 revises the language surrounding Alabama’s warranty services for motor vehicle dealers. Additionally, it authorizes charges for pre-delivery services and compensation for services under those warranty contracts. Effective June 1, 2022.

INDIANA

House Bill 1167 pushes back certain deadlines required of the Indiana BMV to establish a state-wide electronic lien system. Effective in part July 1, 2022, and January 1, 2023.

Governor Eric Holcomb signed House Bill 1351 on March 19, 2022. This Trade Regulation affects all businesses in Indiana which own or use the personal information of an Indiana resident for commercial purposes and will now require notification of a data breach within 45-days of discovery. Effective July 1, 2022.

Among many other provisions, Senate Bill 383 corrects references to the UCCC effective date, amends the provisions in the UCCC governing authorized finance charges for consumer loans other than supervised loans, and establishes provisions concerning permitted additional charges for GAP agreements. The new law also states that the average retail value for a used motor vehicle should be established by a third-party valuation provider to determine GAP coverage instead of the National Automobile Dealers Association average retail value. Effective July 1, 2022.

KENTUCKY

House Bill 284 provides for the Kentucky Transportation Cabinet to establish an electronic title application and registration system for required forms and fees, allow certain entities to send title transfers and fleet registrations, and sets appropriate fees, charges, and policies for the new system. Effective date January 1, 2024.

House Bill 474 requires insurance licensees in Kentucky to investigate known and potential cybersecurity events. By establishing relevant definitions, requirements, and protocols, this new bill will also punish licensees who fail to follow obligations surrounding a cybersecurity event. Finally, this law authorizes the insurance commissioner to investigate, examine, and enforce all provisions for compliance. Effective January 1, 2023.

On April 7, 2022, House Bill 494 was signed into law establishing the Student Education Loan Servicing, Licensing, and Protection Act of 2022. The new bill establishes licensing, abusive practices, record requirements and other conditions to be a student loan servicer in Kentucky. Effective July 14, 2022.

Senate Bill 91 allows for established motor vehicle dealers to deliver vehicles purchased on the Internet to customers at their request. The bill also enables the Motor Vehicle Commission to establish fees for other licensee activities. Effective July 14, 2022.

MAINE

Legislative Document 1843 allows for the Maine Secretary of State to set up an electronic lien titling program following the evaluation of such a need and report back to the legislature by January 1, 2023. Effective July 19, 2022.

MASSACHUSETTS

On February 10, 2022, the Commonwealth of Massachusetts’ Office of Consumer Affairs and Business Regulation in the Division of Banks released a letter regarding the charging of fees when a Massachusetts’s consumer cancels a GAP Waiver product. The position of the Division is that a Massachusetts consumer may not be charged a cancellation fee.

MISSISSIPPI

Senate Bill 2831 establishes the Taxation of Remote and internet-based Computer Software Products and Services Study Committee to study and advise the State of Mississippi on taxing remote and internet software products and services. Effective March 28, 2022.

SOUTH CAROLINA

The Department of Consumer Affairs released its biannual dollar bracket adjustment effective from July 1, 2022, through June 30, 2024. Among the dollar bracket adjustments are:

• The consumer credit sale, consumer lease, and consumer loans defined maximum amount changes from $105,000 to $115,000. (§2.104(1)(e), §2.106(1)(b), and §3.104(d), respectively).
• The maximum delinquency charge for sales and loans transactions changes from $21.00 to $23.00. (§2.203(1) and §3.203(1), respectively).
• The minimum delinquency charge changes from $8.40 to $9.20. (§ 2.203(2)).

Effective July 1, 2022.

SOUTH DAKOTA

House Bill 1082 extends the motor vehicle excise tax on vehicles leased for more than twenty-eight days to include certain off-road vehicles. Effective July 1, 2022.

VIRGINIA

Governor Glenn Youngkin enacted House Bill 1027 on April 11, 2022. This new bill mandates that certain commercial financing providers register with the Commonwealth of Virginia’s State Corporation Commission. Providers or brokers of sales-based financing products will now need to provide certain disclosures with any new offers for financing. The bill also has provisions regarding arbitration, arbitration proceedings, and contractual language allowed in these financing agreements. Finally, the bill expressly provides for its enforcement by the Office of the Attorney General. Effective July 1, 2022.

Senate Bill 215 allows the Virginia DMV to expand the electronic titling program for new motor vehicles to all applications. Additionally, the bill allows the Department to register all vehicles online and charge certain fees to fund these programs. Effective July 1, 2022.

On April 11, 2022, Senate Bill 383 was signed into law by Governor Youngkin. The new law eliminates a required hearing prior to the State Corporation Commission determining the actual loss ratio and adjusting the prima facie credit insurance rates. The new law provides notification of such ratio and rate changes and then an opportunity for a hearing. Effective July 1, 2022.

UTAH

Utah Governor Spencer Cox signed House Bill 186 raising the registration and renewal fees for plug-in hybrid vehicles and hybrid electric vehicles, as well as establishing the road usage rate and charge cap for the next several years. Effective January 1, 2023.

Senate Bill 183 was enacted on March 24, 2022. The new law creates the Commercial Financing Registration and Disclosure Act requiring certain financing entities register with the Department of Financial Institutions if they are providing accounts receivable purchase transactions, commercial loans, or commercial open-end credit. It also requires those entities to provide certain disclosures with their commercial financing products. Effective May 4, 2022.

WASHINGTON

House Bill 1736 creates the Washington Student Loan Program. Administered by the Washington Student Achievement Council, the program is required to consult with the Office of the State Treasurer and the State Investment Board on design and implementation. Effective June 9, 2022.

WEST VIRGINIA

Signed into law on March 12, 2022, by Governor Jim Justice, House Bill 4560 is mostly concerned with regulating interactions between motor vehicle dealers, distributors, wholesalers, and motor vehicle manufacturers. Among other provisions, the bill clarifies how distance is determined between dealerships, how manufacturers and distributors use dealership property, and how manufacturer performance standards are set. Effective June 10, 2022.

House Bill 4567 eliminates the municipal business and occupation or privilege tax for motor vehicle dealers over a three-year period by decreasing the tax on new automobiles that have never been registered. At the end of that three-year period the municipal business and occupation or privilege tax will be eliminated for new vehicles. Effective June 9, 2022.

WYOMING

On March 15, 2022, House Bill 64 was signed into effect. The bill defines theft protection programs, theft protection program warranties, and specifies that they are not insurance. Additionally, the bill amends the scope of service contracts to include repair or maintenance due to road hazards and the replacement of a vehicle key or key fob. Effective July 1, 2022.