SEARCH SITE

VIRGINIA LAW PORTAL

SEARCHABLE DATABASES

ACROSS SESSIONS

Developed and maintained by the Division of Legislative Automated Systems.

2010 SESSION

  • | print version

SB 606 Motor vehicle title loans; establishes requirements, penalties.

Introduced by: Richard L. Saslaw | all patrons    ...    notes | add to my profiles

SUMMARY AS PASSED: (all summaries)

Motor vehicle title loans; penalties. Establishes requirements for motor vehicle title loans, which are nonpurchase money term loans secured by an interest in a motor vehicle. Under this measure, interest shall not exceed 22 percent per month on the portion of the outstanding balance of the loan that does not exceed $700; 18 percent per month on the portion between $700 and $1,400; and 15 percent per month on the portion that exceeds $1,400. Loans may not be for more than 50 percent of the motor vehicle's value as stated in a recognized pricing guide, if listed in such a guide. Principal and interest are required to be repaid in substantially equal monthly payments over the term of the loan, which shall be between 120 days and one year. Interest does not accrue on a loan after the motor vehicle securing the loan has been repossessed or after 60 days following the failure to make a payment unless the borrower is concealing the vehicle. Lenders are barred from seeking a deficiency judgment against a borrower following repossession or sale of the motor vehicle, absent misconduct by the borrower. A lender that does not give the borrower 10 days written notice before repossessing a motor vehicle is barred from collecting the costs of repossession and sale from the borrower. A lender may not charge the borrower for storage fees after the motor vehicle is repossessed or surrendered. Motor vehicle equity lenders are required to be licensed by the State Corporation Commission and are required to post a bond, or equivalent instrument approved by the Commission, of $50,000 per location and $500,000 in the aggregate. An applicant for a license is not required to produce certain records and documents regarding open-end loans made prior to October 1, 2007, and the matters involving loans secured by motor vehicles will not bar an applicant from licensure if they have been reviewed and resolved. A violation of the measure is a prohibited practice under the Consumer Protection Act. Violations are subject to civil and criminal penalties. The measure becomes effective on October 1, 2010.


FULL TEXT

AMENDMENTS

HISTORY