11102064D
HOUSE BILL NO. 2228
Offered January 12, 2011
Prefiled January 12, 2011
A BILL to amend and reenact § 6.2-312 of the Code of Virginia,
relating to open-end credit plans.
----------
Patrons-- O'Bannon and Abbott
----------
Referred to Committee on Commerce and Labor
----------
Be it enacted by the General Assembly of Virginia:
1. That § 6.2-312 of the Code of Virginia is amended
and reenacted as follows:
§ 6.2-312. Open-end credit plans.
A. Notwithstanding any provision of this chapter other than §
6.2-327, and except as provided in subsection C, a seller or
lender engaged in extending of goods to be used for personal, family, or
household purposes may extend
credit to the purchaser thereof, for the sole purpose of
financing the bona fide purchase price of such goods, under
an open-end credit plan and
may impose, on credit extended under the plan, finance charges and other
charges and fees at such rates and in such amounts and manner as may be agreed
upon by the creditor seller and the obligor, if
under the plan a finance charge is imposed upon the obligor if payment in full
of the unpaid balance is not received at the place designated by the creditor seller prior to the next billing date, which shall be at
least 25 days later than the prior billing date.
B. Notwithstanding the provisions of § 6.2-327 and subject to
the provisions of § 8.9A-204.1, any loan made by a
seller under this section may be secured in whole or in
part by a subordinate mortgage or deed of trust on residential real estate
improved by the construction thereon of housing consisting of one- to
four-family dwelling units.
C. (i)
A licensee, as defined in § 6.2-1800, shall not engage in the extension of
credit under an open-end credit plan described in this section and, (ii) a
third party shall not engage in the extension of credit under an open-end
credit plan described in this section at any office, suite, room, or place of
business where a licensee conducts the business of making payday loans. In
addition to any other remedies or penalties provided for a violation of this
section, any such extension of credit made by a licensee or third party in
violation of this subsection shall be unenforceable against the borrower.
D. No
person shall make a loan or otherwise extend credit under an open-end credit
plan or any other lending arrangement that is secured by a non-purchase money
security interest in a motor vehicle, as such term is defined in § 6.2-2200,
unless such loan or extension of credit is made in accordance with, or is
exempt from, the provisions of Chapter 22 (§ 6.2-2200 et seq.).
E. If a licensee, as
defined in § 6.2-1800, surrenders its license under Chapter 18 (§ 6.2-1800 et
seq.) or has its license revoked, and if following such surrender or revocation
of its license the former licensee engages in the extension of credit under an
open-end credit plan as described in this section, then the Commission shall
not issue to such former licensee, or to any affiliate of the former licensee,
a license under Chapter 18 (§ 6.2-1800 et seq.) for a period of 10 years from
the date such license is surrendered or revoked. As used in this subsection,
"affiliate of the former licensee" means a business entity that owns
or controls, is owned or controlled by, or is under common ownership or control
with, the former licensee.
2. That nothing contained in this act shall prohibit
the collection of any outstanding loan or extension of credit made under former
§ 6.1-330.78 or current 6.2-312 of the Code of Virginia in accordance with the
terms of a loan agreement made prior to the effective date of this act;
however, no additional extensions of credit or advances shall be made on or
after the effective date of this act under such a loan agreement that violates
the provisions of this act.
|
