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.

House Bill 5260 revamps the Michigan Vehicle Code in order to change the requirements for used vehicle dealer training. On February 23, 2022, Michigan’s Governor Gretchen Whitmer signed the new law into effect which modified provisions governing dealer training programs, training programs for designated individuals, and continuing education training programs. Among other provisions, the new law also specified that certain training requirements could be satisfied by attending a training program that was conducted by the Secretary of State or a qualified trade organization. These training programs can now be conducted online or by other electronic means. Effective immediately.

NEW MEXICO

On March 1, 2022, Governor Michelle Lujan Grisham signed House Bill 132 enacting a 36% TILA Annual Percentage Rate (“APR”) rate cap for small dollar loans in New Mexico. This law amends the New Mexico Small Loan Act of 1955 and the New Mexico Bank Installment Loan Act of 1959 to make them substantially similar for consumers.

• Threshold: The new law regulates loans up to $10,000 (increased from the previous $5,000 cap).

• Rate: A maximum 36% TILA APR limit replaces the previous limit of 175% TILA APR.
• Fees:
  • Fees included in the finance charge, and therefore subject to the 36% APR Cap, include:
    • Charges for ancillary products or services sold or any fee charges in connection or concurrent with the extension of credit; or
    • Any credit insurance premium or fee and any charge for single premium credit insurance or any other fee related to insurance.
    • *These fees above are specifically included in the New Mexico finance charge definition for purposes of calculating the APR, even if TILA Regulation Z would have excluded them.
  • Amounts paid to a public officially in relation with the extension of credit are specifically excluded from the finance charge.
  • For loans that are $500 or less, a new fee is allowed that may not exceed 5% of the total principal and may be imposed only once a year. This fee is excluded from the finance charge, and therefore the 36% APR Cap.
• Removed Provisions: The new law removed provisions previously included in both laws, including:
  • The 24-month maximum term;
  • Prohibitions on late fees, non-sufficient funds fees, origination fees, prepayment penalties, and charges for ancillary products. Effective January 1, 2023.

NEW YORK

Senate Bill 7721 amends the tax laws in the State of New York to remove language that allowed a lessor with a lease containing a terminal rental adjustment clause to pay the sales tax on the full value of the leased vehicle at the beginning of the lease, as opposed to paying the tax over time. Governor Kathy Hochul signed the bill on February 24, 2022. In addition, the new law clarifies that if a lessor refunds a portion of the receipt to the lessee, then the lessee can claim a credit for the sales taxes paid on the amount refunded. A lessor may claim a credit against any sales taxes paid by the lessee that was refunded if they can show the amount was previously returned. Effective 30-days following the passage of this bill before the next quarterly tax season begins.

SOUTH DAKOTA

On March 7, 2022, Senate Bill 160 was signed into law by Governor Kristi Noem. This bill exempts service contracts from the insurance code. The new law addresses specific requirements for service contract coverage of different vehicle components. Additionally, the law defines theft protection products and items covered under its warranties. Effective July 1, 2022.

Effective State Changes

ARKANSAS

On December 17, 2021, the Division of Workforce Services in the Arkansas Department of Commerce adopted the Forgiveness of Student Loan Program Rule. The program assists eligible employees with the repayment of qualifying student loans. Effective January 1, 2022.

NEW JERSEY

Signed into law on January 18, 2022, Assembly Bill 5033 authorizes motor vehicle dealers to sell motor vehicles online provided they meet certain physical requirements for their business premises. In addition, it allows dealers to obtain electronic signatures for motor vehicle purchases and leases. Effective immediately.

Assembly Bill 6162 established new building requirements for new and used motor vehicle dealers in regard to the size and signage of their business premises. Effective immediately.

NEW YORK

Senate Bill 2767 was signed into law by Governor Kathy Hochul on December 22, 2021. The new law establishes the private student loan refinance task force. Effective immediately.

WISCONSIN

Signed into law on December 3, 2021, Senate Bill 437 eliminated the state of emergency exception for an unregistered vehicle to operate on a highway unless the registration has been mailed or delivered to the Department of Transportation or the vehicle displayed a temporary plate. The new law creates an exception for operating an unregistered vehicle due to an imminent public disaster, imminent death, or great bodily harm. Effective December 5, 2021.

Review of State Changes Effective in 2021

ARIZONA

HB 2721 required Arizona motor vehicle dealers to disclose any Document Fee they charge in advertisements. Effective September 28, 2021.

SB 1463 made technical changes and established new fees for Premium Finance Companies and Advance Fee Loan Brokers. Effective retroactively to June 30, 2020.

ARKANSAS

HB 1893 exempted certain electric and hybrid vehicles from registration fees. Effective retroactively to October 1, 2019.

CALIFORNIA

AB 1864 enacted the California Consumer Financial Protection Law. Effective January 1, 2021.

COLORADO

SB 21-076 imposed a per-transaction fee up to $3, set by the Department of Revenue, on third-party providers to issue titles, registrations, and liens. Effective July 7, 2021.

CONNECTICUT

HB 6100 modernized the motor vehicle Lemon Law. Effective October 1, 2021.

FLORIDA

SB 50 required internet marketplace providers and persons outside of Florida to remit discretionary sales surtax. Effective, in part, on July 1, 2021.

GEORGIA

HB 111 clarified language around credit unions and banks and established the right for a hardship or convenience deferment of an installment loan. Effective July 1, 2021.

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 State of Illinois increased its document preparation fee to $303.60. Effective January 1, 2021.

SB 1792 a maximum charge of 36% APR computed like the MAPR for consumer loans, motor vehicle sales, and retail installment sales. Effective March 23, 2021.

INDIANA

Indiana published dollar adjustments under the consumer credit code for sales, supervised loans, and small loans. Effective January 1, 2021 – December 31, 2023.

IOWA

HF 235 removed requirements to collect a service charge for loans and also prohibited a creditor from collecting a minimum charge upon prepayment. Effective July 1, 2021.

LOUISIANA

SB 67 raised the Documentary Service Fee for the sale of a motor vehicle from $200 to $425. Effective August 1, 2021.

MAINE

LD 522 granted to Maine consumers the right to void a loan that is fraudulently procured under Maine finance law. Effective June 28, 2021.

MARYLAND

SB 281 extended the statutory and regulatory authority of Office of the Commissioner of Financial Regulation’s through July 1, 2032. Effective April 13, 2021.

MICHIGAN

Bulletin 2021-04 adjusted the documentary preparation fee cap to $230. The fee is the lesser of $230 or 5% of the cash price of the motor vehicle. Effective January 15, 2021.

MISSISSIPPI

HB 1075 reenacted the Mississippi Credit Availability Act through July 2026. Effective July 1, 2021.

NEBRASKA

LB 363 defined licensing requirements for sales financing companies who offer installment sales contracts. Effective immediately, March 17, 2021.

NEW HAMPSHIRE

HB 610 required retail sellers, sale finance companies, small loan lenders, debt adjusters, and money transmitters to license with the NMLS. Effective October 9, 2021.

NEW YORK

A10118-A/ S05470B required certain disclosures for commercial financing transactions. Effective June 21, 2021. (Effective date updated to January 1, 2022 per SB 898.)

NORTH DAKOTA

SB 2103 amended money broker loan charges, expanded licensing exemptions, and changed deferred presentment service transaction procedures. Effective August 1, 2021.

OKLAHOMA

The Department of Consumer Credit published the changes in dollar brackets for §2-201, § 3-508(B). The dollar amounts for § 3-508(A) are the same. Effective July 1, 2021.

SB 796 amended the Oklahoma Uniform Commercial Code, specifically changing the brackets, rates, and ceilings of Section 3-508A. Effective November 1, 2021.

PENNSYLVANIA

Pennsylvania’s maximum allowed document preparation fee for 2021 is either $328 or $394 (if electronically filed). Effective January 1, 2021.

SOUTH CAROLINA

Orders 2020-03, 2020-04, and 2020-05 confirmed Prima Facie Credit A&H and Credit Property rates for 2021. Effective January 1, 2021 – December 31, 2021.

SOUTH DAKOTA

SB 8 defined supervised banks, credit unions, foreign banks, and trusts as subject to examination and enforcement. Effective July 1, 2021.

TENNESSEE

HB 421 increased fees and added new fees an industrial loan entity may charge under Tennessee law. Effective July 1, 2021.

TEXAS

The Texas OCCC released the dollar brackets and ceilings for Consumer Loans and Retail Installment Sales. Effective July 1, 2021.

VIRGINIA

HB 789 set a maximum interest rate of 36% for Installment Loans, Open-End Credit Plans, Short Term Lenders, and Motor Vehicle Title Loans. Effective January 1, 2021.

WISCONSIN

Revised Prima Facie Credit Life and Credit Accident and Sickness Insurance rates were released on October 15, 2020. Effective January 1, 2021 – December 31, 2024.

WYOMING

HB 8 capped a consumer loan finance charge at 36% per year on the principal that is equal or less than $1,000, and 21% on the principal above $1,000. Effective July 1, 2021.

Review of State Changes Effective in 2022 & 2023

ARKANSAS

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

HB 1042 repeals the long-term rental vehicle excise tax. Effective January 13, 2022.

SB 184 repeals the Arkansas Pawnbroker Act. Effective January 13, 2022.

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

CALIFORNIA

SB 908 enacts the Debt Collection Act (“DCLA”). Effective January 1, 2022.

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.

AB 424 enacts the Private Student Loan Collections Reform Act. Effective July 1, 2022.

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

GEORGIA

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

ILLINOIS

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

HB 3940 amends the Motor Vehicle Franchise Act. Effective January 1, 2022.

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

INDIANA

HB 1285 sets up a statewide electronic titling and lien system. Effective, in part, on January 1, 2022.

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

IOWA

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

HF 719 creates the Insurance Data Security Act which enacts standards for data security and data breach investigations. Effective January 1, 2022.

MICHIGAN

HB 4117 allows the Secretary of State to issue vehicle registrations for two years if requested by the vehicle owner. Effective October 1, 2022.

NEW JERSEY

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

NEW MEXICO

Prima Facie Credit Insurance Rates were updated by Bulletin 2021-0028 and will go into effect on February 1, 2022.

NEW YORK

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 makes changes to the current statutes governing Guaranteed Asset Protection Waivers. Effective January 1, 2022.

OREGON

SB 485 declares a student loan emergency and creates new procedures in Oregon for student loan lenders. Effective July 1, 2022.

PENNSYLVANIA

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

VIRGINIA

The Virginia Consumer Data Protection Act establishes rights for Virginia consumers to control how companies use their personal data. Effective January 1, 2023.

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.

WASHINGTON

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

Review of Federal Changes Effective in 2021

CONSUMER FINANCIAL PROTECTION BUREAU

Dollar threshold adjustments announced for the Ability to Repay/ Qualified Mortgage Rule and HOEPA. Effective January 1, 2021.

The CFPB published its annual TILA threshold adjustment, as required by the Dodd-Frank. Effective January 1, 2021.

The CFPB released a notice to collect and report on credit applications made by small businesses. Comments were accepted until November 29, 2021.

On October 30, 2020, the CFPB released the Final Rule for Debt Collection Practices—Regulation F. Effective November 30, 2021.

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. Effective January 1, 2022.

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