by Matt Pridemore, Vice President
Cornerstone Support has established a reputation over time as the premier licensing service provider to the collection industry. The nature of the services that we provide and the volume of organizations we serve has uniquely positioned Cornerstone in the ARM Industry. While we are not a law firm and do not provide legal advice, we find ourselves at the forefront of legislative changes and/or enforcement trends related to state licensing.
One of the more recent enforcement trends pertains to the language in various states' uniform consumer credit code ("UCCC"). While UCCC is generally intended to regulate consumer credit, the statutory language seems to include those in the ARM Industry in certain specific circumstances. Below are relevant excerpts for your review. While this may not be an exhaustive list, it represents the statutes we have found to be enforced at this time.
Kansas Supervised Loan License - Debt Buyers:
A Supervised Loan License is required for any business that engages in making supervised loans or taking assignment of and directly or indirectly, including through the use of servicing contracts or otherwise, undertaking collection of payments from or enforcement of rights against debtors arising from supervised loans from Kansas consumers.
A Supervised Loan is defined in Kansas as a consumer loan including a loan made pursuant to open end credit to which the annual percentage rate exceeds 12% per year.
Because debt buyers take assignment of the loan they are required to obtain this license if they purchase Kansas "supervised loans."
Read KS Statute 16a-2-301 Here
Oklahoma Supervised Loan License - Debt Buyers:
A Supervised Loan License is required for any business that engages in making supervised loans or taking assignment of and undertaking direct collection of payments from or enforcement of rights against debtors arising from supervised loans from Oklahoma consumers.
A Supervised Loan is defined in Oklahoma as a consumer loan in which the rate of the loan finance charge exceeds 10% per year.
Because debt buyers take assignment of the loan they are required to obtain this license if they purchase Oklahoma "supervised loans."
Read OK Statute 14A O.S. 1-101 Here
South Carolina Supervised Loan License - Debt Buyers:
A Supervised Loan License is required for any business that engages in making supervised loans or taking assignment of and undertaking direct collection of payments from or enforcement of rights against debtors arising from supervised loans from South Carolina consumers.
A Supervised Loan is defined in South Carolina as a consumer loan in which the rate of the loan finance charge exceeds 12% per year. Please note that a supervised loan does not include a mortgage loan.
Because debt buyers take assignment of the loan they are required to obtain this license if they purchase South Carolina "supervised loans."
Read SC Title 37 Ch 3 Here
West Virginia Regulated Consumer Loan License - Debt Buyers:
A Regulated Consumer Loan License is required for any business that engages in making a regulated consumer loan or taking assignment of and undertaking direct collection of payments from or enforcement of rights against consumers arising from regulated consumer loans.
A Regulated Consumer Loan is defined in West Virginia as a consumer loan, including a loan made pursuant to a revolving loan account, in which the rate of the loan finance charge exceeds 18% per year, except where the loan qualifies for federal law preemption from state interest rate limitations, including federal law bank parity provisions, or where the lender is specifically permitted by state law to make the loan at the rate without a requirement the lender hold a regulated consumer lender license
Because debt buyers take assignment of the loan they are required to obtain this license if they purchase West Virginia "regulated consumer loans."
Read WV Statute 46A-4-101 Here
Wisconsin Consumer Credit Transaction License - Collection Agencies and Debt Buyers:
A Consumer Credit Transaction License is required for any business that engages in making or soliciting consumer credit transactions or directly collects payments from or enforcement of rights against customers arising from such transactions, wherever made.
A Consumer Credit Transaction is defined in Wisconsin as a consumer transaction between a merchant and a customer in which real or personal property, services or money is acquired on credit and the customer's obligation is payable in installments or for which credit a finance charge is or may be imposed, whether such transaction is pursuant to an open-end credit plan or is a transaction involving other than open-end credit. The term includes consumer credit sales, consumer loans, consumer leases and transactions pursuant to open-end credit plans.
Read WI Chapters 421 & 426 Here
Wyoming Supervised Loan License - Debt Buyers:
A Supervised Loan License is required for any business that engages in making supervised loans or taking assignment of and undertaking direct collection of payments from or enforcement of rights against debtors arising from supervised loans from Wyoming consumers.
A Supervised Loan is defined in Wyoming as a consumer loan in which the rate of the loan finance charge exceeds 10% per year.
Because debt buyers take assignment of the loan they are required to obtain this license if they purchase Wyoming "supervised loans."
Read WY Statute 40-14-342 Here
Should you have any questions or issues concerning these matters or should you wish to engage Cornerstone Support's assistance in obtaining these licenses/registrations, contact a Cornerstone Support licensing consultant today at 770-587-4595 or e-mail us at info@cornerstonesupport.com
