2015 New Hampshire Revised Statutes
Title XXXVI - PAWNBROKERS AND MONEYLENDERS
Chapter 399-A - REGULATION OF SMALL LOANS, TITLE LOANS, AND PAYDAY LOANS
Section 399-A:11 - Provisions Applicable to All Persons Under This Chapter.
I. Any loan made outside this state, as permitted by the laws of the state in which the loan was made, may be collected in this state in accordance with its terms.
II. No person making small loans, payday loans, or title loans, shall advertise, print, display, publish, distribute, or broadcast or cause or permit to be advertised, printed, displayed, published, distributed, or broadcast, in any manner whatsoever, any statement or representation with regard to the rates, terms, or conditions which is false, misleading, or deceptive.
III. This chapter, or any part thereof may be modified, amended, or repealed so as to effect a cancellation or alteration of any license, or right of a licensee hereunder, provided that such modification, amendment, or repeal shall not impair or affect the obligation of any pre-existing lawful contracts between any licensee and any borrowers.
IV. No interest shall be paid, deducted, or received in advance. Interest shall not be compounded and interest shall be computed only on unpaid principal balances. For the purpose of computing interest, whether at the maximum rate or less, a month shall be considered a calendar month and, where a fraction of a month is involved, a day shall be considered 1/30 of a month. However, if all or any part of the consideration for a loan contract is the unpaid principal balance of the prior loan with the same lender then the loan contract may include unpaid interest of such prior loan which has accrued within 60 days of the making of the loan contract.
V. If charges in excess of those permitted by this chapter shall be charged, contracted for, or received except as a result of an accidental or bona fide error the contract of loan shall be void and the lender shall have no right to collect or receive any principal, charges, or recompense whatsoever.
VI. No person shall take any confession of judgment or any power of attorney running to himself, herself, or any third person to confess judgment or to appear for the borrower in a judicial proceeding; nor take any note, agreement, or promise to pay which does not disclose the date and amount or maximum credit line of the note or agreement, a schedule or description of the payments to be made thereon, and the agreed charges or rates of charge; nor take any instrument in which blanks are left to be filled in after the loan is made.
VII. No person shall include any of the following provisions in a small loan, payday loan, or title loan contract:
(a) A hold-harmless clause;
(b) A confession of judgment or other waiver of the right to notice and the opportunity to be heard in an action;
(c) An agreement by the consumer not to assert any claim or defense arising out of the contract against the lender or any holder in due course;
(d) An executory waiver or a limitation of exemption from attachment, execution, or other process on real or personal property held by, owned by, or due to the consumer, unless the waiver or limitation applies only to property subject to a security interest executed in connection with the loan; or
(e) A clause permitting the continuation of interest after repossession of the consumer's motor vehicle.
VIII. No person shall be permitted to accept as collateral on a loan under this chapter:
(a) Real estate; or
(b) Household furniture presently in use on loans of $2,000 or less.
IX. Any agreement purporting to convey to a lender a security interest in the property listed in paragraph VIII shall be null and void.
X. If a borrower desires to renew an existing closed-end loan or title loan for the purpose of obtaining additional cash a new contract shall be drawn up in its entirety and such prior loan shall be paid in full from such proceeds of the new loan. Payday loans shall not be rolled over, renewed, or refinanced. All legal papers in connection with such prior loan shall be stamped "PAID IN FULL'' and returned to such borrower.
XI. No charge for any examination, service, brokerage, commission, or other fee shall be directly or indirectly made or contracted for on closed-end loans, payday loans, or title loans except the lawful fees, if any, actually and necessarily paid out by the lender to any public officer, for filing or recording in any public office any instrument securing such loan, which fees may be collected when such loan is made, or at any time thereafter and except the reasonable costs, charges, and expenses, including court costs actually incurred in connection with a repossession of the security or an actual sale of the security in foreclosure proceedings or upon entry of judgment.
XII. Credit life insurance, credit accident and health insurance, and credit involuntary unemployment insurance may be issued in connection with a loan or other credit transaction authorized by this chapter in compliance with the provisions of RSA 408:15, II and the cost of such insurance and any commission, benefit, or return to the lender therefrom shall not be deemed a violation of any provision of this chapter; provided, however, that if there is more than one borrower or obligor on any such loan or credit transaction, credit life insurance providing a single benefit may cover both borrowers or obligors.
XIII. The lender may require a borrower to insure tangible personal property given to secure the loan against any substantial risk of loss, damage, or destruction for an amount not to exceed the reasonable value of the property insured or the amount of the loan, whichever is less, and for the customary insurance term approximating the term of the loan. The borrower shall not be required to insure against unusual or exceptional risks not ordinarily insured against in policies issued to nonborrowers. The premium for such insurance may be included in the principal amount of the loan. Such insurance shall be written by or through a duly licensed insurance agent or broker with a company qualified to do business in New Hampshire. Such insurance shall name the borrower as insured but may include the lender as co-insured or protect the interest of the lender under a loss-payable clause. No lender shall require a borrower to duplicate or cancel existing insurance or to purchase insurance from a lender or any employee, affiliate, or associate of the lender or from any agent, broker, or insurance company designated by the lender, as a condition precedent to the making of the loan.
XIV. A lender in the business of making small loans, payday loans, or title loans shall include in every loan contract a notice, printed in type size equal to at least 12-point type, stating that the consumer or the consumer's attorney may file a complaint with the commissioner.
399-A:11 Record Keeping Requirements. --
I. The licensee shall maintain such books and records in accordance with sound business and accepted accounting practices as will enable the department to determine whether the licensee's business is in compliance with the provisions of this chapter and the rules adopted pursuant to it. Such records shall be maintained in a readily accessible location and made available for examination at the licensee's New Hampshire principal office or its New Hampshire branch office location or the office of its New Hampshire agent for a period of at least 3 years after the licensee's final transaction on a loan or application file.
II. A licensee may maintain its records in electronic format if, upon request, the licensee provides the commissioner with:
(a) A full explanation of the programming of any data storage or communications systems in use; and
(b) Information from any books, records, electronic data processing systems, computers, or any other information storage system in the form requested by the commissioner.
Source. 2015, 73:1, eff. Jan. 1, 2016.
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