1 STATE OF OKLAHOMA
2 1st Session of the 59th Legislature (2023)
3 HOUSE BILL 1543 By: Moore
4
5
6 AS INTRODUCED
7 An Act relating to the Uniform Consumer Credit Code;
amending 14A O.S. 2021, Section 1-106,as last amended
8 by Section 1, Chapter 207, O.S.L. 2022 (14A O.S.
Supp. 2022, Section 1-106), which relates to changes
9 in certain dollar amounts; amending 14A O.S. 2021,
Section 1-301, which relates to definitions;
10 modifying definition; amending 14A O.S. 2021, Section
6-501, which relates to the Department of Consumer
11 Credit; eliminating references to Consumer Credit
Advisory Committee; and providing an effective date.
12
13
14
15 BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
16 SECTION 1. AMENDATORY 14A O.S. 2021, Section 1-106, as
17 amended by Section 1, Chapter 207, O.S.L. 2022 (14A O.S. Supp. 2022,
18 Section 1-106), is amended to read as follows:
19 Section 1-106. (1) From time to time the dollar amounts in
20 paragraphs (a), (b) and (c) of subsection (2) of Section 2-201,
21 paragraph (a) of subsection (1) of Section 2-203, subsection (1) of
22 Section 2-407, Section 2-413, paragraph (b) of subsection (1) of
23 Section 3-203, Section 3-203.1, subsection (4) of Section 3-508A,
24 subsection (1) of Section 3-510, paragraphs (a) and (b) of Section
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1 3-511, Section 3-514, and subsections (2) and (3) of Section 5-103
2 of the Uniform Consumer Credit Code, are hereby designated as
3 subject to change and shall change, as provided in this section and
4 the rules of the Administrator, according to and to the extent of
5 changes in the Consumer Price Index for Urban Wage Earners and
6 Clerical Workers: U.S. City Average, All Items, 1967=100, compiled
7 by the Bureau of Labor Statistics, United States Department of
8 Labor, and hereafter referred to as the Index. The Index for
9 December of the year 1973 shall be deemed the Reference Base Index.
10 The dollar amounts established by rule of the Administrator in
11 paragraph (e) of subsection (1) of Section 2-104, paragraph (b) of
12 subsection (1) of Section 2-106 and paragraph (d) of Section 3-104
13 of the Uniform Consumer Credit Code in effect on January 1, 1982,
14 shall remain in full force and effect.
15 (2) From time to time, the dollar amounts in subsection (1) of
16 Section 3-508B of the Uniform Consumer Credit Code are hereby
17 designated as subject to change and shall change, as provided in
18 this section and the rules of the Administrator, according to and to
19 the extent of changes in the Consumer Price Index for Urban Wage
20 Earners and Clerical Workers: U.S. City Average, All Items, 1982-
21 84=100, compiled by the Bureau of Labor Statistics, United States
22 Department of Labor, and hereafter referred to as the Index. The
23 Index for December 2021 2020 shall be deemed the Reference Base
24 Index.
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1 (3) The designated dollar amounts referenced in subsection (1)
2 of this section shall change on July 1 of each year if the
3 percentage of change, calculated to the nearest whole percentage
4 point, between the Index at the end of the preceding year and the
5 Reference Base Index is ten percent (10%) or more, but:
6 (a) the portion of the percentage change in the Index in
7 excess of a multiple of ten percent (10%) shall be
8 disregarded and the dollar amounts shall change only
9 in multiples of ten percent (10%) of the amounts
10 appearing in the Uniform Consumer Credit Code; and
11 (b) the dollar amounts shall not change if the amounts
12 required by this section are those currently in effect
13 pursuant to the Uniform Consumer Credit Code as a
14 result of earlier application of this section.
15 (4) The designated dollar amounts referenced in subsection (2)
16 of this section shall change on July 1 of each year if the
17 percentage of change, calculated to the nearest whole percentage
18 point, between the Index at the end of the preceding year and the
19 Reference Base Index is one percent (1%) or more, but:
20 (a) the portion of the percentage change in the Index in
21 excess of three percent (3%) shall be disregarded and
22 shall change only in multiples of one percent (1%), to
23 a maximum of three percent (3%); and
24
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1 (b) the dollar amounts shall not change if the amounts
2 required by this section are those currently in effect
3 pursuant to the Uniform Consumer Credit Code as a
4 result of earlier application of this section.
5 (5) If the Index is revised, the percentage of change pursuant
6 to this section shall be calculated on the basis of the revised
7 Index. If a revision of the Index changes the Reference Base Index,
8 a revised Reference Base Index shall be determined by multiplying
9 the Reference Base Index then applicable by the rebasing factor
10 furnished by the United States Bureau of Labor Statistics. If the
11 Index is superseded, the Index referred to in this section shall be
12 the one represented by the United States Bureau of Labor Statistics
13 as reflecting most accurately changes in the purchasing power of the
14 dollar for consumers.
15 (6) The rules of the Administrator shall provide for
16 appropriate notice to licensees and other interested
17 persons of any changes in the dollar amounts which
18 result from changes required by subsection (2) of this
19 section no later than April 30 of each year. Each
20 dollar amount subject to change as provided in this
21 section shall be listed in an appendix to the rules of
22 the Administrator and shall be published in the
23 Oklahoma Administrative Code. Changes to the appendix
24 shall be submitted to the Secretary of State prior to
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1 the annual deadline for submitting material for
2 publication in the Code. Changes in the appendix
3 shall not be construed as rulemaking.
4 (a) include the method for calculating the changes in
5 dollar amounts required by subsection (2) of this
6 section;
7 (b) be amended in accordance with the Administrative
8 Procedures Act to include changes in the Index
9 required by subsection (3) of this section including,
10 if applicable, the numerical equivalent of the
11 Reference Base Index under a revised Reference Base
12 Index and the designation or title of any index
13 superseding the Index; and
14 (c)
15 (b)
16 (7) A person does not violate the Uniform Consumer Credit
17 Code with respect to a transaction otherwise complying
18 with the Uniform Consumer Credit Code if he or she
19 relies on dollar amounts either determined according
20 to subsection (2) of this section or appearing in the
21 last rule of the Administrator announcing the then
22 current dollar amounts.
23 SECTION 2. AMENDATORY 14A O.S. 2021, Section 1-301, is
24 amended to read as follows:
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1 Section 1-301.
2 In addition to definitions appearing in subsequent articles, in
3 this title:
4 (1) "Actuarial Method" means the method, defined by rules
5 adopted by the Administrator, of allocating payments made on a debt
6 between principal or amount financed and loan finance charge or
7 credit service charge pursuant to which a payment is applied first
8 to the accumulated loan finance charge or credit service charge and
9 the balance is applied to the unpaid principal or unpaid amount
10 financed.
11 (2) "Administrator" means the Administrator designated in the
12 article (Article 6) on administration under Section 6-103 of this
13 title.
14 (3) "Agreement" means the bargain of the parties in fact as
15 found in their language or by implication from other circumstances
16 including course of dealing or usage of trade or course of
17 performance.
18 (4) "Agricultural purpose" means a purpose related to the
19 production, harvest, exhibition, marketing, transportation,
20 processing, or manufacture of agricultural products by a natural
21 person who cultivates, plants, propagates, or nurtures the
22 agricultural products. "Agricultural products" includes
23 agricultural, horticultural, viticultural, and dairy products,
24 livestock, wildlife, poultry, bees, forest products, fish and
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1 shellfish, and any products thereof, including processed and
2 manufactured products, and any and all products raised or produced
3 on farms and any processed or manufactured products thereof.
4 (5) "Closing costs" with respect to a debt secured by an
5 interest in land includes:
6 (a) fees or premiums for title examination, title
7 insurance or similar purposes including surveys;
8 (b) fees for preparation of a deed, settlement statement
9 or other documents;
10 (c) escrows for future payments of taxes and insurance;
11 (d) fees for notarizing deeds and other documents;
12 (e) appraisal fees; and
13 (f) credit reports.
14 (6) "Conspicuous": A term or clause is "conspicuous" when it
15 is so written that a reasonable person against whom it is to operate
16 ought to have noticed it. Whether a term or clause is conspicuous
17 or not is for decision by the court.
18 (7) "Credit" means the right granted by a creditor to a debtor
19 to defer payment of debt or to incur debt and defer its payment.
20 (8) "Earnings" means compensation paid or payable to an
21 individual or for the individual's account for personal services
22 rendered or to be rendered by the individual, whether denominated as
23 wages, salary, commission, bonus, or otherwise, and includes
24
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1 periodic payments pursuant to a pension, retirement, or disability
2 program.
3 (9) "Lender credit card or similar arrangement" means an
4 arrangement or loan agreement, other than a seller credit card,
5 pursuant to which a lender gives a debtor the privilege of using a
6 credit card, letter of credit, or other credit confirmation or
7 identification in transactions out of which debt arises:
8 (a) by a lender's honoring a draft or similar order for
9 the payment of money drawn or accepted by the debtor;
10 (b) by the lender's payment or agreement to pay the
11 debtor's obligations; or
12 (c) by the lender's purchase from the obligee of the
13 debtor's obligations.
14 (10) (a) "Subsection 10 mortgage" means a consumer credit
15 transaction that is secured by the consumer's
16 principal dwelling, other than a residential mortgage
17 transaction, a reverse mortgage transaction, or a
18 transaction under an open-end credit plan, if:
19 (i) the annual percentage rate at consummation of the
20 transaction will exceed by more than eight (8)
21 percentage points for first-lien loans, or by
22 more than ten (10) percentage points for
23 subordinate-lien loans, the yield on treasury
24 securities having comparable periods of maturity
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1 on the fifteenth day of the month immediately
2 preceding the month in which the application for
3 the extension of credit is received by the
4 creditor; or
5 (ii) the total points and fees payable by the consumer
6 at or before closing will exceed the greater of:
7 (aa) eight percent (8%) of the total loan amount;
8 or
9 (bb) Four Hundred Dollars ($400.00).
10 (b) After the two-year period beginning on the effective
11 date of the regulations promulgated under Section 155
12 of the Riegle Community Development and Regulatory
13 Improvement Act of 1994, and no more frequently than
14 biennially after the first increase or decrease under
15 this subsection, the Administrator may by rule
16 increase or decrease the number of percentage points
17 specified in subparagraph (i) of paragraph (a) of this
18 subsection, if the Administrator determines that the
19 increase or decrease is consistent with the consumer
20 protections against abusive lending provided by the
21 amendments made by subtitle B of Title I of the Riegle
22 Community Development and Regulatory Improvement Act
23 of 1994 and is warranted by the need for credit.
24
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1 Such an increase or decrease may not result in the
2 number of percentage points referred to in this
3 subsection being less than eight (8) percentage points
4 or greater than twelve (12) percentage points.
5 In determining whether to increase or decrease the
6 number of percentage points, the Administrator shall
7 consult with representatives of consumers, including
8 low-income consumers, and lenders.
9 (c) The amount specified in division (bb) of subparagraph
10 (ii) of paragraph (a) of this subsection shall be
11 adjusted annually on January 1 by the annual
12 percentage change in the Consumer Price Index, as
13 reported on June 1 of the year preceding such
14 adjustment.
15 (d) For purposes of subparagraph (ii) of paragraph (a) of
16 this subsection, points and fees shall include:
17 (i) all items included in the finance charge, except
18 interest or the time-price differential;
19 (ii) all compensation paid to mortgage brokers;
20 (iii) each of the charges listed in 15 U.S.C., Section
21 1605(e), except an escrow for future payment of
22 taxes, unless:
23 (aa) the charge is reasonable;
24
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1 (bb) the creditor receives no direct or indirect
2 compensation; and
3 (cc) the charge is paid to a third party
4 unaffiliated with the creditor;
5 (iv) premiums or other charges for credit life,
6 accident, health, or loss-of-income insurance, or
7 debt-cancellation coverage, whether or not the
8 debt-cancellation coverage is insurance under
9 applicable law, that provides for cancellation of
10 all or part of the consumer's liability in the
11 event of the loss of life, health, or income or
12 in the case of accident, written in connection
13 with the credit transaction; and
14 (v) such other charges as the Administrator
15 determines to be appropriate.
16 (e) The provisions of this subsection shall not be
17 construed to limit the rate of interest or the finance
18 charge that a person may charge a consumer for any
19 extension of credit.
20 (11) "Official fees" means:
21 (a) fees and charges prescribed by law which actually are
22 or will be paid to public officials for determining
23 the existence of or for perfecting, releasing, or
24
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1 satisfying a security interest related to a consumer
2 credit sale, consumer lease, or consumer loan; or
3 (b) premiums payable for insurance in lieu of perfecting a
4 security interest other