2009 Iowa Code
Title 13 - Commerce
Subtitle 3 - Money and Credit
CHAPTER 537 - CONSUMER CREDIT CODE
537.1301 - GENERAL DEFINITIONS.

        537.1301  GENERAL DEFINITIONS.
         As used in this chapter, unless otherwise required by the context:

         1.  "Actuarial method" means the method of allocating payments
      made on a debt between the amount financed and the finance charge,
      pursuant to which a payment is applied first to the accumulated
      finance charge and any remainder is subtracted from, or any
      deficiency is added to, the unpaid balance of the amount financed.
      The administrator may adopt rules not inconsistent with the Truth in
      Lending Act further defining the term and prescribing its
      application.
         2.  "Administrator" means the administrator designated in
      section 537.6103.
         3.  "Affiliate" as used in reference to a state bank means the
      same as defined in section 524.1101.  "Affiliate" as used in
      reference to a national banking association means the same as defined
      in section 524.1101, except that the term "national banking
      association" shall be substituted for the term "state bank".
      "Affiliate" as used in reference to a savings and loan
      association shall mean the same as defined in 12 C.F.R. § 561.4.
         4.  "Agreement" means the oral or written bargain of the
      parties in fact as found in their language or by implication from
      other circumstances including course of dealing or usage of trade or
      course of performance.
         5.  "Amount financed" means:
         a.  In the case of a sale, the cash price of the goods,
      services, or interest in land, plus the amount actually paid or to be
      paid by the seller pursuant to an agreement with the buyer to
      discharge a security interest in, a lien on, or a debt with respect
      to property traded in, less the amount of any down payment whether
      made in cash or in property traded in, plus additional charges if
      permitted under paragraph "c".
         b.  In the case of a loan, the net amount paid to, receivable
      by, or paid or payable for the account of the debtor, plus the amount
      of any discount excluded from the finance charge under subsection 21,
      paragraph "b", subparagraph (3), plus additional charges if
      permitted under paragraph "c" of this subsection.
         c.  In the case of a sale or loan, additional charges
      permitted under section 537.2501, to the extent that payment is
      deferred, that the charge is not otherwise included, in the amount
      permitted respectively in paragraph "a" or "b", and that the
      charge is authorized by and disclosed to the consumer as required by
      law.
         6.  "Billing cycle" means the time interval between periodic
      billing statement dates.
         7.  "Card issuer" means a person who issues a credit card.
         8.  "Cardholder" means a person to whom a credit card is
      issued or who has agreed with the card issuer to pay obligations
      arising from the issuance or use of the card to or by another person.

         9.  "Cash price" of goods, services, or an interest in land
      means, except in the case of a consumer rental purchase agreement,
      the price at which they are sold by the seller to cash buyers in the
      ordinary course of business, and may include the cash price of
      accessories or services related to the sale, such as delivery,
      installation, alterations, modifications, and improvements, and taxes
      to the extent imposed on a cash sale of the goods, services, or
      interest in land.
         10.  Conspicuous.  A term or clause is conspicuous when it is
      so written that a reasonable person against whom it is to operate
      ought to have noticed it.  Whether or not a term or clause is
      conspicuous is for decision by the court.
         11.  "Consumer" means the buyer, lessee, or debtor to whom
      credit is granted in a consumer credit transaction.
         12.  "Consumer credit transaction" means a consumer credit
      sale or consumer loan, or a refinancing or consolidation thereof, or
      a consumer lease, or a consumer rental purchase agreement.
         13.  Consumer credit sale.
         a.  Except as provided in paragraph "b", a consumer credit
      sale is a sale of goods, services, or an interest in land in which
      all of the following are applicable:
         (1)  Credit is granted either pursuant to a seller credit card or
      by a seller who regularly engages as a seller in credit transactions
      of the same kind.
         (2)  The buyer is a person other than an organization.
         (3)  The goods, services or interest in land are purchased
      primarily for a personal, family or household purpose.
         (4)  Either the debt is payable in installments or a finance
      charge is made.
         (5)  With respect to a sale of goods or services, the amount
      financed does not exceed twenty-five thousand dollars.
         b.  A "consumer credit sale" does not include:
         (1)  A sale in which the seller allows the buyer to purchase goods
      or services pursuant to a lender credit card.
         (2)  A sale of an interest in land if the finance charge does not
      exceed twelve percent per year calculated on the actuarial method on
      the assumption that the debt will be paid according to the agreed
      terms and will not be paid before the end of the agreed term.
         (3)  A consumer rental purchase agreement as defined in section
      537.3604.
         14.  Consumer lease.
         a.  Except as provided in paragraph "b", a consumer lease
      is a lease of goods in which all of the following are applicable:
         (1)  The lessor is regularly engaged in the business of leasing.
         (2)  The lessee is a person other than an organization.
         (3)  The lessee takes under the lease primarily for a personal,
      family, or household purpose.
         (4)  The amount payable under the lease does not exceed
      twenty-five thousand dollars.
         (5)  The lease is for a term exceeding four months.
         b.  A consumer lease does not include a consumer rental
      purchase agreement as defined in section 537.3604.
         15.  Consumer loan.
         a.  Except as provided in paragraph "b", a "consumer
      loan" is a loan in which all of the following are applicable:
         (1)  The person is regularly engaged in the business of making
      loans.
         (2)  The debtor is a person other than an organization.
         (3)  The debt is incurred primarily for a personal, family or
      household purpose.
         (4)  Either the debt is payable in installments or a finance
      charge is made.
         (5)  The amount financed does not exceed twenty-five thousand
      dollars.
         b.  A "consumer loan" does not include:
         (1)  A sale or lease in which the seller or lessor allows the
      buyer or lessee to purchase or lease pursuant to a seller credit
      card.
         (2)  A debt which is secured by a first lien on real property and
      which is incurred primarily for the purpose of acquiring that real
      property, or refinancing a contract for deed to that real property,
      or constructing on that real property a building containing one or
      more dwelling units.
         (3)  A loan financed by the Iowa finance authority and secured by
      a lien on land.
         (4)  A consumer rental purchase agreement as defined in section
      537.3604.
         c.  In determining which loans are consumer loans under this
      subsection the rules of construction stated in this paragraph shall
      be applied:
         (1)  A debt is incurred primarily for the purpose to which a
      majority of the loan proceeds are applied or are designated by the
      debtor to be applied.
         (2)  Loan proceeds used to refinance or pay a prior loan owed by
      the same borrower are incurred for the same purposes and in the same
      proportion as the principal of the loan refinanced or paid.
         (3)  Loan proceeds used to pay a prior loan by a different
      borrower are incurred for the new borrower's purposes in agreeing to
      pay the prior loan.
         (4)  The assumption of a loan by a different borrower is treated
      as if the new borrower had obtained a new loan and had used all of
      the proceeds to pay the loan assumed.
         (5)  The provisions of this paragraph shall not be construed to
      modify or limit the provisions of section 535.8, subsection 2,
      paragraph "c" or "e".
         16.  "Credit" means the right granted by a person extending
      credit to a person to defer payment of debt, to incur debt and defer
      its payment, or to purchase property or services and defer payment
      therefor.
         17.  "Credit card" means a card or device issued under an
      arrangement pursuant to which a card issuer gives a cardholder the
      privilege of purchasing or leasing property or purchasing services,
      obtaining loans, or otherwise obtaining credit from the card issuer
      or other persons.  A transaction is "pursuant to a credit card"
      if credit is obtained according to the terms of the arrangement by
      transmitting information contained on the card or device orally, in
      writing, by mechanical or automated methods, or in any other manner.
      A transaction is not "pursuant to a credit card" if the card or
      device is used solely to identify the cardholder and credit is not
      obtained according to the terms of the arrangement.
         18.  "Creditor" means the person who grants credit in a
      consumer credit transaction or, except as otherwise provided, an
      assignee of a creditor's right to payment, but use of the term does
      not in itself impose on an assignee any obligation of the assignee's
      assignor.  In the case of credit granted pursuant to a credit card,
      the "creditor" is the card issuer and not another person honoring the
      credit card.
         19.  "Credit union service organization" means an
      organization, corporation, or association whose membership or
      ownership is primarily confined or restricted to credit unions or
      organizations of credit unions and whose purpose is primarily
      designed to provide services to credit unions, organizations of
      credit unions, or credit union members.
         20.  "Earnings" means compensation paid or payable to an
      individual or for the individual's account for personal services
      rendered or to be rendered by the individual, whether denominated as
      wages, salary, commission, bonus, or otherwise, and includes periodic
      payments pursuant to a pension, retirement or disability program.
         21.  Finance charge.
         a.  Except as otherwise provided in paragraph "b",
      "finance charge" means the sum of all charges payable directly or
      indirectly by the consumer and imposed directly or indirectly by the
      creditor as an incident to or as a condition of the extension of
      credit, including any of the following types of charges which are
      applicable:
         (1)  Interest or any amount payable under a point, discount or
      other system of charges, however denominated, except that with
      respect to a consumer credit sale of goods or services a cash
      discount of five percent or less of the stated price of goods or
      services which is offered to the consumer for payment by cash, check
      or the like either immediately or within a period of time, is not
      part of the finance charge for the purpose of determining maximum
      charges pursuant to section 537.2401.  A cash discount permitted by
      this subparagraph is not part of the finance charge for the purpose
      of determining compliance with section 537.3201 if it is properly
      disclosed as required by the Truth in Lending Act as amended to and
      including July 1, 1982 and regulations issued pursuant to that Act
      prior to July 1, 1982.
         (2)  Time price differential, credit service, service, carrying or
      other charge, however denominated.
         (3)  Premium or other charge for any guarantee or insurance
      protecting the creditor against the consumer's default or other
      credit loss.
         (4)  Charges incurred for investigating the collateral or
      credit-worthiness of the consumer or for commissions or brokerage for
      obtaining the credit, irrespective of the person to whom the charges
      are paid or payable, unless the creditor had no notice of the charges
      when the credit was granted.
         b.  "Finance charge" does not include:
         (1)  Charges as a result of default or delinquency if made for
      actual unanticipated late payment, delinquency, default, or other
      like occurrence unless the parties agree that these charges are
      finance charges.  A charge is not made for actual unanticipated late
      payment, delinquency, default or other like occurrence if imposed on
      an account which is or may be debited from time to time for purchases
      or other debts and, under its terms, payment in full or at a
      specified amount is required when billed, and in the ordinary course
      of business the consumer is permitted to continue to have purchases
      or other debts debited to the account after the imposition of the
      charge.
         (2)  Additional charges as defined in section 537.2501, or
      deferral charges as defined in section 537.2503.
         (3)  A discount, if a creditor purchases or satisfies obligations
      of a cardholder pursuant to a credit card and the purchase or
      satisfaction is made at less than the face amount of the obligation.

         (4)  Lease payments for a consumer rental purchase agreement, or
      charges specifically authorized by this chapter for consumer rental
      purchase agreements.
         22.  "Gift certificate" means a merchandise certificate
      conspicuously designated as a gift certificate, and purchased by a
      buyer for use by a person other than the buyer.
         23. a.  "Goods" includes, but is not limited to:
         (1)  "Goods" as described in section 554.2105, subsection 1.
         (2)  Goods not in existence at the time the transaction is entered
      into.
         (3)  Things in action.
         (4)  Investment securities.
         (5)  Mobile homes regardless of whether they are affixed to the
      land.
         (6)  Gift certificates.
         b.  "Goods" excludes money, chattel paper, documents of
      title, instruments and merchandise certificates other than gift
      certificates.
         24.  "Insurance premium loan" means a consumer loan that is
      made for the sole purpose of financing the payment by or on behalf of
      an insured of the premium on one or more policies or contracts issued
      by or on behalf of an insurer, is secured by an assignment by the
      insured to the lender of the unearned premium on the policy or
      contract, and contains an authorization to cancel the policy or
      contract financed.
         25.  "Lender" means a person who makes a loan or, except as
      otherwise provided in this Act, a person who takes an assignment of a
      lender's right to payment, but use of the term does not in itself
      impose on an assignee any obligation of the lender.
         26.  "Lender credit card" means a credit card issued by a
      lender.
         27. a.  "Loan" means any of the following, except as provided
      in paragraph "b":
         (1)  The creation of debt by the lender's payment of or agreement
      to pay money to the debtor or to a third person for the account of
      the debtor.
         (2)  The creation of debt by a credit to an account with the
      lender upon which the debtor is entitled to draw immediately.
         (3)  The creation of debt pursuant to a lender credit card in any
      manner, including a cash advance or the card issuer's honoring a
      draft or similar order for the payment of money drawn or accepted by
      the debtor, paying or agreeing to pay the debtor's obligation, or
      purchasing or otherwise acquiring the debtor's obligation from the
      obligee or the obligee's assignees.
         (4)  The creation of debt by a cash advance to a debtor pursuant
      to a seller credit card.
         (5)  The forbearance of debt arising from a loan.
         b.  "Loan" does not include:
         (1)  A card issuer's payment or agreement to pay money to a third
      person for the account of a debtor if the debt of the debtor arises
      from a sale or lease and results from use of a seller credit card.
         (2)  The forbearance of debt arising from a sale or lease.
         28.  "Merchandise certificate" means a writing not redeemable
      in cash and usable in its face amount in lieu of cash in exchange for
      goods or services.  Sale of a merchandise certificate on credit is a
      credit sale beginning at the time the certificate is redeemed.
         29.  "Mortgage lender" means a domestic or foreign corporation
      authorized in this state to make loans secured by mortgages or deeds
      of trust.
         30.  "Official fees" means:
         a.  Fees and charges prescribed by law which actually are or
      will be paid to public officials for determining the existence of or
      for perfecting, releasing, terminating, or satisfying a security
      interest related to a consumer credit transaction.
         b.  Premiums payable for insurance in lieu of perfecting a
      security interest otherwise required by the creditor in connection
      with the transaction, if the premium does not exceed the fees and
      charges described in paragraph "a" which would otherwise be
      payable.
         31.  "Open-end credit" means an arrangement, other than a
      consumer rental purchase agreement, pursuant to which all of the
      following are applicable:
         a.  A creditor may permit a consumer, from time to time, to
      purchase or lease on credit from the creditor or pursuant to a credit
      card, or to obtain loans from the creditor or pursuant to a credit
      card.
         b.  The amounts financed and the finance and other appropriate
      charges are debited to an account.
         c.  The finance charge, if made, is computed on the account
      periodically.
         d.  Either the consumer has the privilege of paying in full or
      in installments, or the transaction is a consumer credit transaction
      solely because a delinquency charge or the like is treated as a
      finance charge pursuant to subsection 21, paragraph "b",
      subparagraph (1) of this section or the creditor otherwise
      periodically imposes charges computed on the account for delaying
      payment of it and permits the consumer to continue to purchase or
      lease on credit.
         32.  "Organization" means a corporation, government or
      governmental subdivision or agency, trust, estate, cooperative, or
      association.
         33.  "Payable in installments" means that payment is required
      or permitted by agreement to be made in more than four periodic
      payments, excluding a down payment.  If any periodic payment other
      than the down payment under an agreement requiring or permitting two
      or more periodic payments is more than twice the amount of any other
      periodic payment excluding the down payment, a transaction is
      "payable in installments".
         34.  "Person" means:
         a.  A natural person, partnership, or an individual.
         b.  An organization.
         35. a.  "Person related to" with respect to a natural person
      or an individual means any of the following:
         (1)  The spouse of the individual.
         (2)  A brother, brother-in-law, sister, or sister-in-law of the
      individual.
         (3)  An ancestor or lineal descendant of the individual or the
      individual's spouse.
         (4)  Any other relative, by blood or marriage, of the individual
      or the individual's spouse, if the relative shares the same home with
      the individual.
         b.  "Person related to" with respect to an organization
      means:
         (1)  A person directly or indirectly controlling, controlled by or
      under common control with the organization.
         (2)  An officer or director of the organization or a person
      performing similar functions with respect to the organization or to a
      person related to the organization.
         (3)  The spouse of a person related to the organization.
         (4)  A relative by blood or marriage of a person related to the
      organization who shares the same home with the person.
         36.  A "precomputed consumer credit transaction" is a consumer
      credit transaction, other than a consumer lease or a consumer rental
      purchase agreement, in which the debt is a sum comprising the amount
      financed and the amount of the finance charge computed in advance.  A
      disclosure required by the Truth in Lending Act does not in itself
      make a finance charge or transaction precomputed.
         37.  "Presumed" or "presumption" means that the trier of
      fact must find the existence of the fact presumed unless and until
      evidence is introduced which would support a finding of its
      nonexistence.
         38.  "Sale of goods" includes, but is not limited to, any
      agreement in the form of a bailment or lease of goods if the bailee
      or lessee pays or agrees to pay as compensation for use a sum
      substantially equivalent to or in excess of the aggregate value of
      the goods involved and it is agreed that the bailee or lessee will
      become, or for no other or a nominal consideration has the option to
      become, the owner of the goods upon full compliance with the terms of
      the agreement.  "Sale of goods" does not include a consumer
      rental purchase agreement.
         39.  "Sale of an interest in land" includes, but is not
      limited to, a lease in which the lessee has an option to purchase the
      interest, by which all or a substantial part of the rental or other
      payments previously made by the lessee are applied to the purchase
      price.
         40.  "Sale of services" means furnishing or agreeing to
      furnish services for a consideration and includes making arrangements
      to have services furnished by another.
         41.  "Seller" means a person who makes a sale or, except as
      otherwise provided in this chapter, a person who takes an assignment
      of the seller's right to payment, but use of the term does not in
      itself impose on an assignee any obligation of the seller.
         42.  "Seller credit card" means either of the following:
         a.  A credit card issued primarily for the purpose of giving
      the cardholder the privilege of using the credit card to purchase or
      lease property or services from the card issuer, persons related to
      the card issuer, persons licensed or franchised to do business under
      the card issuer's business or trade name or designation, or from any
      of these persons and from other persons as well.
         b.  A credit card issued by a person other than a supervised
      lender primarily for the purpose of giving the cardholder the
      privilege of using the credit card to purchase or lease property or
      services from at least one hundred persons not related to the card
      issuer.
         43.  "Services" includes, but is not limited to:
         a.  Work, labor, and other personal services.
         b.  Privileges or benefits with respect to transportation,
      hotel and restaurant accommodations, education, entertainment,
      recreation, physical culture, hospital accommodations, funerals,
      cemetery accommodations, and the like.
         c.  Insurance.
         44.  "Supervised financial organization" means a person, other
      than an insurance company or other organization primarily engaged in
      an insurance business, which is organized, chartered, or holding an
      authorization certificate pursuant to chapter 524, 533, or 534, or
      pursuant to the laws of any other state or of the United States which
      authorizes the person to make loans and to receive deposits,
      including a savings, share, certificate or deposit account, and which
      is subject to supervision by an official or agency of this state,
      such other state, or of the United States.
         45.  "Supervised loan" means a consumer loan, including a loan
      made pursuant to open end credit, in which the rate of the finance
      charge, calculated according to the actuarial method, exceeds the
      rate of finance charge permitted in chapter 535.
         With respect to a consumer loan made pursuant to open end credit,
      the finance charge shall be deemed not to exceed the rate permitted
      in chapter 535 if the finance charge contracted for and received does
      not exceed a charge for each monthly billing cycle which is
      one-twelfth of that rate multiplied by the average daily balance of
      the open end account in the billing cycle for which the charge is
      made.  The average daily balance of the open end account is the sum
      of the amount unpaid each day during that cycle divided by the number
      of days in the cycle.  The amount unpaid on a day is determined by
      adding to the balance, if any, unpaid as of the beginning of that day
      all purchases and other debits and deducting all payments and other
      credits made or received as of that day.  If the billing cycle is not
      monthly, the finance charge shall be deemed not to exceed that rate
      per year if the finance charge contracted for and received does not
      exceed a percentage which bears the same relation to that rate as the
      number of days in the billing cycle bears to three hundred
      sixty-five.  A billing cycle is monthly if the closing date of the
      cycle is the same date each month or does not vary by more than four
      days from the regular date.  

         Section History: Early Form

         [C58, 62, 66, 71, 73, § 322.2(12)--(15), C75, 77, 79, S79, C81, §
      537.1301; 81 Acts, ch 76, 8, ch 177, § 3, 4; 82 Acts, ch 1153, §
      9--13, 18(1), ch 1253, § 42] 

         Section History: Recent Form

         83 Acts, ch 101, § 114; 83 Acts, ch 124, § 24, 25; 87 Acts, ch 80,
      §26--34; 97 Acts, ch 187, § 1; 2003 Acts, ch 44, §92; 2005 Acts, ch
      44, §1
         Referred to in § 99F.9, 103A.58, 137C.25A, 321.486, 321A.3,
      322.19, 322.33, 322C.12, 524.913, 533.315, 535.10, 535.11, 535.17,
      536.1, 536.13, 536.27, 536.28, 536A.3, 536A.31, 536C.2, 537.1303,
      537.3603, 552.1, 552.17, 554.13103, 602.8103, 642.22, 805.14