1 STATE OF OKLAHOMA
1
2 1st Session of the 59th Legislature (2023)
2
3 SENATE BILL 793 By: Coleman
3
4
4
5
5
6 AS INTRODUCED
6
7 An Act relating to the Uniform Consumer Credit Code;
7 amending 14A O.S. 2021, Section 1-106, as amended by
8 Section 1, Chapter 207, O.S.L. 2022 (14A O.S. Supp.
8 2022, Section 1-106), which relates to change in
9 dollar amounts; reverting to a previous year's
9 Consumer Price Index; removing provision for
10 percentage change in the Index under certain
10 conditions; relinquishing certain rulemaking control
11 of the Administrator; amending 14A O.S. 2021, Section
11 1-301, which relates to definitions; modifying
12 definition; amending 14A O.S. 2021, Section 6-501,
12 which relates to administration; removing the
13 Consumer Credit Advisory Committee; and declaring an
13 emergency.
14
14
15
15
16 BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
16
17 SECTION 1. AMENDATORY 14A O.S. 2021, Section 1-106, as
17
18 amended by Section 1, Chapter 207, O.S.L. 2022 (14A O.S. Supp. 2022,
18
19 Section 1-106), is amended to read as follows:
19
20 Section 1-106. (1) From time to time the dollar amounts in
20
21 paragraphs (a), (b) and (c) of subsection (2) of Section 2-201,
21
22 paragraph (a) of subsection (1) of Section 2-203, subsection (1) of
22
23 Section 2-407, Section 2-413, paragraph (b) of subsection (1) of
23
24 Section 3-203, Section 3-203.1, subsection (4) of Section 3-508A,
24
Req. No. 719 Page 1
 1 subsection (1) of Section 3-510, paragraphs (a) and (b) of Section
1
2 3-511, Section 3-514, and subsections (2) and (3) of Section 5-103
2
3 of the Uniform Consumer Credit Code, are hereby designated as
3
4 subject to change and shall change, as provided in this section and
4
5 the rules of the Administrator, according to and to the extent of
5
6 changes in the Consumer Price Index for Urban Wage Earners and
6
7 Clerical Workers: U.S. City Average, All Items, 1967=100, compiled
7
8 by the Bureau of Labor Statistics, United States Department of
8
9 Labor, and hereafter referred to as the Index. The Index for
9
10 December of the year 1973 shall be deemed the Reference Base Index.
10
11 The dollar amounts established by rule of the Administrator in
11
12 paragraph (e) of subsection (1) of Section 2-104, paragraph (b) of
12
13 subsection (1) of Section 2-106 and paragraph (d) of Section 3-104
13
14 of the Uniform Consumer Credit Code in effect on January 1, 1982,
14
15 shall remain in full force and effect.
15
16 (2) From time to time, the dollar amounts in subsection (1) of
16
17 Section 3-508B of the Uniform Consumer Credit Code are hereby
17
18 designated as subject to change and shall change, as provided in
18
19 this section and the rules of the Administrator, according to and to
19
20 the extent of changes in the Consumer Price Index for Urban Wage
20
21 Earners and Clerical Workers: U.S. City Average, All Items, 1982-
21
22 84=100, compiled by the Bureau of Labor Statistics, United States
22
23 Department of Labor, and hereafter referred to as the Index. The
23
24
24
Req. No. 719 Page 2
 1 Index for December 2021 2020 shall be deemed the Reference Base
1
2 Index.
2
3 (3) The designated dollar amounts referenced in subsection (1)
3
4 of this section shall change on July 1 of each year if the
4
5 percentage of change, calculated to the nearest whole percentage
5
6 point, between the Index at the end of the preceding year and the
6
7 Reference Base Index is ten percent (10%) or more, but:
7
8 (a) the portion of the percentage change in the Index in
8
9 excess of a multiple of ten percent (10%) shall be
9
10 disregarded and the dollar amounts shall change only
10
11 in multiples of ten percent (10%) of the amounts
11
12 appearing in the Uniform Consumer Credit Code; and
12
13 (b) the dollar amounts shall not change if the amounts
13
14 required by this section are those currently in effect
14
15 pursuant to the Uniform Consumer Credit Code as a
15
16 result of earlier application of this section.
16
17 (4) The designated dollar amounts referenced in subsection (2)
17
18 of this section shall change on July 1 of each year if the
18
19 percentage of change, calculated to the nearest whole percentage
19
20 point, between the Index at the end of the preceding year and the
20
21 Reference Base Index is one percent (1%) or more, but:
21
22 (a) the portion of the percentage change in the Index in
22
23 excess of three percent (3%) shall be disregarded and
23
24
24
Req. No. 719 Page 3
 1 shall change only in multiples of one percent (1%), to
1
2 a maximum of three percent (3%); and
2
3 (b) the dollar amounts shall not change if the amounts
3
4 required by this section are those currently in effect
4
5 pursuant to the Uniform Consumer Credit Code as a
5
6 result of earlier application of this section.
6
7 (5) If the Index is revised, the percentage of change pursuant
7
8 to this section shall be calculated on the basis of the revised
8
9 Index. If a revision of the Index changes the Reference Base Index,
9
10 a revised Reference Base Index shall be determined by multiplying
10
11 the Reference Base Index then applicable by the rebasing factor
11
12 furnished by the United States Bureau of Labor Statistics. If the
12
13 Index is superseded, the Index referred to in this section shall be
13
14 the one represented by the United States Bureau of Labor Statistics
14
15 as reflecting most accurately changes in the purchasing power of the
15
16 dollar for consumers.
16
17 (6) The rules of the Administrator shall:
17
18 (a) include the method for calculating the changes in
18
19 dollar amounts required by subsection (2) of this
19
20 section;
20
21 (b) be amended in accordance with the Administrative
21
22 Procedures Act to include changes in the Index
22
23 required by subsection (3) of this section including,
23
24 if applicable, the numerical equivalent of the
24
Req. No. 719 Page 4
 1 Reference Base Index under a revised Reference Base
1
2 Index and the designation or title of any index
2
3 superseding the Index; and
3
4 (c) provide for appropriate notice to licensees and other
4
5 interested persons of any changes in the dollar
5
6 amounts which result from changes required by
6
7 subsection (2) of this section no later than April 30
7
8 of each year. Each dollar amount subject to change as
8
9 provided in this section shall be listed in an
9
10 appendix to the rules of the Administrator and shall
10
11 be published in the Oklahoma Administrative Code.
11
12 Changes to the appendix shall be submitted to the
12
13 Secretary of State prior to the annual deadline for
13
14 submitting material for publication in the Code.
14
15 Changes in the appendix shall not be construed as
15
16 rulemaking.
16
17 (7) A person does not violate the Uniform Consumer Credit Code
17
18 with respect to a transaction otherwise complying with the Uniform
18
19 Consumer Credit Code if he or she relies on dollar amounts either
19
20 determined according to subsection (2) of this section or appearing
20
21 in the last rule of the Administrator announcing the then current
21
22 dollar amounts.
22
23 SECTION 2. AMENDATORY 14A O.S. 2021, Section 1-301, is
23
24 amended to read as follows:
24
Req. No. 719 Page 5
 1 Section 1-301. In addition to definitions appearing in
1
2 subsequent articles, in this title:
2
3 (1) "Actuarial Method" means the method, defined by rules
3
4 adopted by the Administrator, of allocating payments made on a debt
4
5 between principal or amount financed and loan finance charge or
5
6 credit service charge pursuant to which a payment is applied first
6
7 to the accumulated loan finance charge or credit service charge and
7
8 the balance is applied to the unpaid principal or unpaid amount
8
9 financed.
9
10 (2) "Administrator" means the Administrator designated in the
10
11 article (Article 6) on administration under Section 6-103 of this
11
12 title.
12
13 (3) "Agreement" means the bargain of the parties in fact as
13
14 found in their language or by implication from other circumstances
14
15 including course of dealing or usage of trade or course of
15
16 performance.
16
17 (4) "Agricultural purpose" means a purpose related to the
17
18 production, harvest, exhibition, marketing, transportation,
18
19 processing, or manufacture of agricultural products by a natural
19
20 person who cultivates, plants, propagates, or nurtures the
20
21 agricultural products. "Agricultural products" includes
21
22 agricultural, horticultural, viticultural, and dairy products,
22
23 livestock, wildlife, poultry, bees, forest products, fish and
23
24 shellfish, and any products thereof, including processed and
24
Req. No. 719 Page 6
 1 manufactured products, and any and all products raised or produced
1
2 on farms and any processed or manufactured products thereof.
2
3 (5) "Closing costs" with respect to a debt secured by an
3
4 interest in land includes:
4
5 (a) fees or premiums for title examination, title
5
6 insurance or similar purposes including surveys;
6
7 (b) fees for preparation of a deed, settlement statement
7
8 or other documents;
8
9 (c) escrows for future payments of taxes and insurance;
9
10 (d) fees for notarizing deeds and other documents;
10
11 (e) appraisal fees; and
11
12 (f) credit reports.
12
13 (6) "Conspicuous": A term or clause is "conspicuous" when it
13
14 is so written that a reasonable person against whom it is to operate
14
15 ought to have noticed it. Whether a term or clause is conspicuous
15
16 or not is for decision by the court.
16
17 (7) "Credit" means the right granted by a creditor to a debtor
17
18 to defer payment of debt or to incur debt and defer its payment.
18
19 (8) "Earnings" means compensation paid or payable to an
19
20 individual or for the individual's account for personal services
20
21 rendered or to be rendered by the individual, whether denominated as
21
22 wages, salary, commission, bonus, or otherwise, and includes
22
23 periodic payments pursuant to a pension, retirement, or disability
23
24 program.
24
Req. No. 719 Page 7
 1 (9) "Lender credit card or similar arrangement" means an
1
2 arrangement or loan agreement, other than a seller credit card,
2
3 pursuant to which a lender gives a debtor the privilege of using a
3
4 credit card, letter of credit, or other credit confirmation or
4
5 identification in transactions out of which debt arises:
5
6 (a) by a lender's honoring a draft or similar order for
6
7 the payment of money drawn or accepted by the debtor;
7
8 (b) by the lender's payment or agreement to pay the
8
9 debtor's obligations; or
9
10 (c) by the lender's purchase from the obligee of the
10
11 debtor's obligations.
11
12 (10) (a) "Subsection 10 mortgage" means a consumer credit
12
13 transaction that is secured by the consumer's
13
14 principal dwelling, other than a residential mortgage
14
15 transaction, a reverse mortgage transaction, or a
15
16 transaction under an open-end credit plan, if:
16
17 (i) the annual percentage rate at consummation of the
17
18 transaction will exceed by more than eight (8)
18
19 percentage points for first-lien loans, or by
19
20 more than ten (10) percentage points for
20
21 subordinate-lien loans, the yield on treasury
21
22 securities having comparable periods of maturity
22
23 on the fifteenth day of the month immediately
23
24 preceding the month in which the application for
24
Req. No. 719 Page 8
 1 the extension of credit is received by the
1
2 creditor; or
2
3 (ii) the total points and fees payable by the consumer
3
4 at or before closing will exceed the greater of:
4
5 (aa) eight percent (8%) of the total loan amount;
5
6 or
6
7 (bb) Four Hundred Dollars ($400.00).
7
8 (b) After the two-year period beginning on the effective
8
9 date of the regulations promulgated under Section 155
9
10 of the Riegle Community Development and Regulatory
10
11 Improvement Act of 1994, and no more frequently than
11
12 biennially after the first increase or decrease under
12
13 this subsection, the Administrator may by rule
13
14 increase or decrease the number of percentage points
14
15 specified in subparagraph (i) of paragraph (a) of this
15
16 subsection, if the Administrator determines that the
16
17 increase or decrease is consistent with the consumer
17
18 protections against abusive lending provided by the
18
19 amendments made by subtitle B of Title I of the Riegle
19
20 Community Development and Regulatory Improvement Act
20
21 of 1994 and is warranted by the need for credit.
21
22 Such an increase or decrease may not result in the
22
23 number of percentage points referred to in this
23
24
24
Req. No. 719 Page 9
 1 subsection being less than eight (8) percentage points
1
2 or greater than twelve (12) percentage points.
2
3 In determining whether to increase or decrease the
3
4 number of percentage points, the Administrator shall
4
5 consult with representatives of consumers, including
5
6 low-income consumers, and lenders.
6
7 (c) The amount specified in division (bb) of subparagraph
7
8 (ii) of paragraph (a) of this subsection shall be
8
9 adjusted annually on January 1 by the annual
9
10 percentage change in the Consumer Price Index, as
10
11 reported on June 1 of the year preceding such
11
12 adjustment.
12
13 (d) For purposes of subparagraph (ii) of paragraph (a) of
13
14 this subsection, points and fees shall include:
14
15 (i) all items included in the finance charge, except
15
16 interest or the time-price differential;
16
17 (ii) all compensation paid to mortgage brokers;
17
18 (iii) each of the charges listed in 15 U.S.C., Section
18
19 1605(e), except an escrow for future payment of
19
20 taxes, unless:
20
21 (aa) the charge is reasonable;
21
22 (bb) the creditor receives no direct or indirect
22
23