State Codes and Statutes

State Codes and Statutes

Statutes > North-carolina > Chapter_53 > GS_53-180

§ 53‑180.  Limitationsand prohibitions on practices and agreements.

(a)        Time and PaymentLimitation. – Except as otherwise provided in this Article, no licensee makinga loan pursuant to G.S. 53‑173 shall enter into any contract of loanunder this Article providing for any scheduled repayment of principal more than25 months from the date of making the contract if the cash advance is sixhundred dollars ($600.00) or less; more than 37 months from the date of makingthe contract if the cash advance is in excess of six hundred dollars ($600.00)but not in excess of fifteen hundred dollars ($1,500); more than 49 months fromthe date of making the contract if the cash advance is in excess of fifteenhundred dollars ($1,500) but not in excess of two thousand five hundred dollars($2,500); or more than 61 months if the cash advance is in excess of twothousand five hundred dollars ($2,500). Every loan contract shall provide forrepayment of the amount loaned in substantially equal installments, either ofprincipal or of principal and charges in the aggregate, at approximately equalperiodic intervals of time. Nothing contained herein shall prevent a loan beingconsidered a new loan because the proceeds of the loan are used to pay anexisting contract.

(b)        No Assignment ofEarnings. – A licensee may not take an assignment of earnings of the borrowerfor payment or as security for payment of a loan. An assignment of earnings inviolation of this section is unenforceable by the assignee of the earnings andis revocable by the borrower. A sale of unpaid earnings made in considerationof the payment of money to or for the account of the seller of the earnings isdeemed to be a loan to the seller by an assignment of earnings.

(c)        Limitation onDefault Provisions. – An agreement between a licensee and a borrower pursuantto a loan under this Article with respect to default by the borrower isenforceable only to the extent that (i) the borrower fails to make a payment asrequired by the agreement, or (ii) the prospect of payment, performance, orrealization of collateral is significantly endangered or impaired, the burdenof establishing the prospect of a significant endangerment or impairment beingon the licensee.

(d)        Prohibitions onDiscrimination. – No licensee shall deny any extension of credit ordiscriminate in the fixing of the amount, duration, application procedures orother terms or conditions of such extension of credit because of the race,color, religion, national origin, sex or marital status of the applicant or anyother person connected with the transaction.

(e)        Limitation onAttorney's Fees. – With respect to a loan made pursuant to the provisions ofG.S. 53‑173, the agreement may not provide for payment by the borrower ofattorney fees.

(f)         No Real Propertyas Security. – No licensee shall make any loan within this State which shall inany way be secured by real property.

(g)        Deceptive Acts orPractices. – No licensee shall engage in any unfair method of competition orunfair or deceptive trade practices in the conduct of making loans to borrowerspursuant to this Article or in collecting or attempting to collect any moneyalleged to be due and owing by a borrower.

(h)        Limitations on HomeLoans. – No affiliate operating in the same office or subsidiary operating inthe same office of a licensee shall make any home loan as defined in G.S. 24‑1.1A(e)in a principal amount of less than three thousand dollars ($3,000).

(i)         Limitation onConditions to Making Loans. – A licensee or an affiliate operating in the sameoffice or subsidiary operating in the same office of a licensee shall not makeas a condition of any loan the refinancing of a borrower's home loan as definedin G.S. 24‑1.1A(e) which is not currently in default.

(j)         No Solicitation ofDeposits. – No licensee may directly or indirectly solicit from any borrowerfunds to be held on deposit in any bank; provided, however, a borrower may athis option, by way of a military allotment or other such program, designate adepository to receive and disburse funds for a designated purpose.

(k)        Loans made pursuantto this Article solicited using a facsimile or negotiable check shall besubject to the provisions of G.S. 75‑20(a). (1961, c. 1053, s. 1; 1969,c. 1303, s. 24; 1973, c. 1042, s. 7; 1979, c. 33, s. 3; 1981, c. 464, s. 3;1985, c. 154, ss. 10‑12; 1987, c. 444, s. 3; 1989, c. 17, ss. 8, 13; 2001‑519,s. 5.)