Consumer Finance

Link to law: http://arcweb.sos.state.or.us/pages/rules/oars_400/oar_441/441_730.html
Published: 2015

The Oregon Administrative Rules contain OARs filed through November 15, 2015

 

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DEPARTMENT OF CONSUMER AND BUSINESS SERVICES,

DIVISION OF FINANCE AND CORPORATE SECURITIES









 

DIVISION 730
CONSUMER FINANCE

441-730-0000
Statutory Authority; Purpose
(1) OAR 441-730-0000 to 441-730-0320 is adopted pursuant to the rulemaking authority granted the director by ORS 725.320, and 725.505.
(2) The rules are considered necessary to assure the proper conduct of the business regulated, to enforce the Consumer Finance Act and to protect the public.
Stat. Auth.: ORS 725.320, 725.505

Stats. Implemented: ORS 725

Hist.: BB 14, f. & ef. 11-15-76; Renumbered from 805-075-0005; FCS 12-1988, f. 7-20-88, cert. ef. 8-1-88; FCS 13-2001, f. & cert. ef. 12-27-01; FCS 5-2006, f. & cert. ef. 12-21-06; FCS 2-2007(Temp), f. 6-29-07, cert. ef. 7-1-07 thru 12-27-07; FCS 6-2010, f. & cert. ef. 6-4-10
441-730-0010
Definitions
(1) "Annual percentage rate” or
“APR” means the annual percentage rate that every licensee is required
by Regulation Z of the Federal Truth in Lending Act (Title I of the Consumer Credit
Protection Act) to disclose to each of its credit customers.
(2) "Borrower" means a natural
person.
(3) “Branch”
means a physical location at which business is conducted and which is required to
post a license under 725.160.
(4) "Charges" means any one
or more of the fees, premiums or other charges described by ORS 725.340(2)(a), (3)
and (4), and other items charged to a borrower's account; but the term does not
include interest or deferral charges.
(5) "Deferral charges" means
the additional charge assessed by a licensee made for deferring all unpaid installments
as provided by ORS 725.340(2)(b). Deferral charges do not apply to loans with a
single payment payback feature.
(6) "Director" means the
Director of the Department of Consumer and Business Services.
(7) “Finance charge”
means the cost of consumer credit as a dollar amount. It includes any charge payable
directly or indirectly by the consumer and imposed directly or indirectly by the
creditor as an incident to or a condition of the extension of credit. It does not
include any charge of a type payable in a comparable cash transaction.
(8) "Formalized grading system"
means a formula or computer program that determines the creditworthiness of individual
borrowers based on information regarding the borrower's financial condition, such
as the borrower's income, assets, debts and financial obligations, and the nature
and value of any collateral used to secure the loan.
(9) "Fully amortized" means
characterized by periodic payments, that if made as scheduled, result in full repayment
of the principal and interest owed on a loan by the end of the loan term.
(10) "License" means a consumer
finance license required to make consumer finance loans as described in ORS 725.045.
(11) “Legally qualified
in this state” means a business is qualified to conduct business in this state,
having made the appropriate filings with the Secretary of State.
(12) "Licensee" means a person
in the business of making loans for periods of more than 60 days that have periodic
payments.
(13) "Loan" means a loan
that is subject to the Oregon Consumer Finance Act.
(14) "Loan underwriting"
means a written or otherwise documented evaluation of the assumption of risk preceding
the granting of a loan to a specific borrower, and may be fulfilled through use
of a formalized grading system. Loan underwriting may be based on one or more of
the following:
(a) Credit information furnished
by the borrower, such as employment history, income, and outstanding obligations;
(b) A financial statement
that includes income, assets and debts;
(c) Publicly available information
concerning the borrower, that may include the borrower's credit report;
(d) The borrower's credit
needs and willingness and ability to pay, including the nature and value of any
collateral used to secure the loan.
(15) “Nationwide Mortgage
Licensing System and Registry” or “NMLS” means a system that the
Conference of State Bank Supervisors and the American Association of Residential
Mortgage Regulators and successors develop and maintain for participating state
agencies to use to register and license mortgage loan originators and non-depository
companies and made available at www.nationwidelicensingsystem.org.
(16) "Periodic payments"
means loan repayments scheduled for monthly or more frequent periods of time.
(17) "Person" means a natural
person or an organization, including a corporation, partnership, proprietorship,
association, limited liability company, or cooperative.
(18) “Register”
means entering the general information into the NMLS that is required to utilize
the system for licensing and renewal.
Stat. Auth.: ORS 725.320 & 725.505
Stats. Implemented: ORS 725.110,
725.140, 725.340, & 725.360
Hist.: BB 14, f. & ef.
11-15-76; BB 5-1982, f. 9-1-82, ef. 9-15-82; Renumbered from 805-075-0007; FCS 12-1988,
f. 7-20-88, cert. ef. 8-1-88; FCS 2-2000, f. & cert. ef. 2-15-00; FCS 2-2001,
f. 1-22-01, cert. ef. 3-22-01; FCS 6-2001(Temp), f. 6-29-01, cert. ef. 7-1-01 thru
12-25-01; FCS 13-2001, f. & cert. ef. 12-27-01; FCS 2-2004, f. & cert. ef.
8-5-04; FCS 5-2006, f. & cert. ef. 12-21-06; FCS 2-2007(Temp), f. 6-29-07, cert.
ef. 7-1-07 thru 12-27-07; FCS 3-2009, f. & cert. ef. 6-2-09; FCS 6-2010, f.
& cert. ef. 6-4-10; FCS 7-2013(Temp), f. 12-31-13, cert. ef. 1-1-14 thru 6-30-14;
Administrative correction, 7-24-14; FCS 3-2014, f. & cert. ef. 8-25-14
441-730-0015
Licensee Lending Characteristics and Practices
(1) A licensee, making loans under that license, must make a determination of the creditworthiness of a borrower based on the information about the borrower’s financial condition, such as his or her income, assets, debts, and financial obligations, and the nature and value of any collateral used to secure the loan for the majority of loans made under a consumer finance license.
(2) A licensee must ensure that the majority of secured or unsecured loans made under a license have:
(a) Periodic payments;
(b) Terms longer than 60 days;
(c) Loan underwriting; and
(d) Full amortization.
(3) A licensee must not:
(a) Disguise any loan as an open-ended loan authorized under ORS 725.345 or 725.347 as a device or subterfuge to evade the requirements and prohibitions of this rule;
(b) Retain the title to the vehicle used as security on a loan for more than thirty business days before submitting the application to be recorded as a lien-holder on the title or taking other commercially reasonable steps to be added as a security interest holder of the vehicle;
(c) Unreasonably withhold documents on a loan secured by a borrower’s vehicle for more than three business days if the loan is paid by certified or guaranteed funds; or
(d) Require a borrower, as a condition of making a loan under its license, to provide a postdated check or debit authorization for one or more future payments. However, if permitted by the licensee and at the discretion of the borrower, one or more postdated checks or debit authorizations may be delivered to a licensee to facilitate timely future payments.
Stat. Auth.: ORS 725.505

Stats. Implemented: ORS 725.110, 725.140(1) & 725.330

Hist.: FCS 2-2000, f. & cert. ef. 2-15-00; Renumbered from 441-730-0005, FCS 5-2006, f. & cert. ef. 12-21-06; FCS 3-2007(Temp), f. & cert. ef. 8-10-07 thru 12-27-07; FCS 3-2009, f. & cert. ef. 6-2-09; FCS 6-2010, f. & cert. ef. 6-4-10
441-730-0025
License Applications
(1) For purposes of ORS 725.120, an
applicant for a license must submit an application attested to by an authorized
owner or officer of the applicant through the Nationwide Mortgage Licensing System
and Registry (NMLS).
(2) Applicants and licensees
must comply with the registration, application, licensing, and renewal processes
set forth in the NMLS.
(3)(a) An applicant, including
a current licensee, must provide the employment history for a proposed manager of
the licensed location for the five years immediately preceding the date of the application.
A licensee employing a new manager may be required to submit a resume to meet the
requirements of this section.
(b) The employment history
for a license applicant’s proposed manager must demonstrate verifiable recent
experience in traditional lending, including but not limited to, experience obtained
in banking, consumer finance, or mortgage lending. For purposes of this rule, “recent”
means no less than three years out of the five years immediately preceding the date
of application. Short-term lending experience alone is not a sufficient substitute
for the required experience.
(c) At the request of the
applicant and in the sole discretion of the director, education, extensive training,
or other business experience may be substituted for the three out of five years
of traditional lending experience. Factors that the director may consider include
relevance of the education, or the number, complexity and types of transactions
handled in the substituted business experience. Short-term lending experience alone
is not a sufficient substitute for the required experience.
(4) A person not currently
licensed with the director to make loans must submit:
(a) The employment history
for all executive officers, owners, directors, or managing partners. A resume may
be required to meet this requirement. At least one-half of the executive officers,
owners, directors, or managing partners must have verifiable recent lending experience
in banking, consumer finance, or mortgage lending;
(b) A business plan, including
but not limited to:
(A) Financial and operational
history of the applicant, if any;
(B) Copies of any loan documents
that are proposed to be used;
(C) A description of the
types of loans and the percentage of the different types of loans the applicant
proposes to make, the length of the loans the applicant proposes to make, the interest
rates or range of rates the applicant proposes to charge, and any other business
activities the licensee will engage in at the location;
(D) The process by which
the applicant will determine that loans to be made comply with requirements in OAR
441-730-0015(1); and
(E) Funding sources for the
loans, including third-party financial institutions.
(5) For purposes of ORS 725.140
and this rule, the filing date of an application is the date the application is
complete. An application must be deemed complete on the date:
(a) All required fees have
been paid; and
(b) All fully completed documents
that are part of an NMLS registration, NMLS application or that are required to
be submitted by this rule have been received.
(6) An initial application
for licensing is deemed abandoned if:
(a) The director has had
one or more incomplete documents as part of an application for a minimum of 60 days;
and
(b) The applicant has not
responded within 30 days following a written notice from the director requesting
submission of all fees, documents, or information necessary to make the application
complete.
(7) An applicant whose initial
application has been abandoned may reapply by submitting a new application including
new fees.
(8) A consumer finance lending
license shall expire on December 31 of each calendar year. At least 30 days prior
to the expiration of the license, the licensee shall submit a complete renewal request,
including renewing NMLS registration if applicable, and all prescribed renewal fees
at OAR 441-730-0030 through NMLS. A renewal is not deemed effective until approved
by the Director.
(9) In the event a licensee
does not receive renewal approval from the Director by December 31, the license
is deemed to have lapsed in NMLS.
(a) Reinstatement is available
through NMLS through the last day of February of the renewal year. In order to reinstate
the license, the licensee must apply for reinstatement using NMLS.
(b) If a licensee fails to
reinstate by the last day in February of the renewal year they must reapply for
a license.
(10) Conducting consumer
finance activity in the state after an annual license expires and before the license
approved for renewal constitutes unlicensed consumer finance activity in violation
of ORS 725.045.
(11) The Director may refuse
to renew a license if a reason exists to suspend or revoke under ORS 725.230.
(12) NMLS shall collect any
fees required to be paid by applicants and licensees as authorized by ORS 725.185(1)
on behalf of the Director. NMLS is required to forward these fees to the Department
of Consumer and Business Services, pursuant to the terms of the written agreement
between the Department of Consumer and Business Services and the Conference of State
Bank Supervisors and its subsidiaries.
Stat. Auth.: ORS 725.505
Stats. Implemented: ORS 725.120
& 725.140
Hist.: FCS 5-2006, f. &
cert. ef. 12-21-06; FCS 3-2009, f. & cert. ef. 6-2-09; FCS 6-2010, f. &
cert. ef. 6-4-10; FCS 7-2013(Temp), f. 12-31-13, cert. ef. 1-1-14 thru 6-30-14;
Administrative correction, 7-24-14; FCS 4-2014, f. & cert. ef. 8-27-14
441-730-0026
Corporate Surety Bond for Consumer Finance Licensees Employing a Mortgage Loan Originator
(1)
This rule applies to a consumer finance company licensed under ORS 725.010 to 725.270
and OAR chapter 441, division 730 that employs one or more mortgage loan originators.
The corporate surety bond must be in a form and on terms approved by the director.
(2)
A corporate surety bond under this rule must be renewed or replaced each calendar
year, concurrently with the license renewal of any mortgage loan originators employed
by the consumer finance company. The corporate surety bond shall be delivered to
the director by December 1 of each calendar year but may be made effective as of
December 31 of each calendar year. In no case shall any applicant, mortgage banker
or mortgage broker subject to this rule reduce the amount of a corporate surety
bond before October 1 of each calendar year.
(3)
A consumer finance company must maintain a corporate surety bond during the period
the company employs a mortgage loan originator. The corporate surety bond must remain
in effect for at least five years after the person ceases to employ one or more
mortgage loan originators. A person must file a claim against the corporate surety
bond before the bond expires as described in this section.
(4)
At least five years after a consumer finance company ceases to originate residential
mortgage loans, the person or the writer of the corporate surety bond may apply
to the director for release of the corporate surety bond. Unless the director determines
that claims are pending against the person for violation of ORS 86A.095 through
86A.198, the director will release the corporate surety bond.
(5)
The sum of the corporate surety bond for a consumer finance company that employs
one or more mortgage loan originators must be calculated based on the last required
annual report submitted under OAR 441-730-0320. The sum of each consumer finance
company’s corporate surety bond must be determined as follows:
(a)
For a consumer finance company that has not previously conducted business involving
the origination of residential mortgage loans, the corporate surety bond must be
in the amount of $50,000.
(b)
For a consumer finance company making or negotiating less than $10,000,000 in residential
mortgage loans in the previous calendar year, the corporate surety bond must be
in the amount of $50,000.
(c)
For a consumer finance company making or negotiating $10,000,000 or more but less
than $25,000,000 in residential mortgage loans in the previous calendar year, the
corporate surety bond must be in the amount of $75,000.
(d)
For a consumer finance company making or negotiating $25,000,000 or more but less
than $50,000,000 in residential mortgage loans in the previous calendar year, the
corporate surety bond must be in the amount of $100,000.
(e)
For a consumer finance company making or negotiating $50,000,000 or more but less
than $100,000,000 in residential mortgage loans in the previous calendar year, the
corporate surety bond must be in the amount of $150,000.
(f)
For a consumer finance company making or negotiating more than $100,000,000 in residential
mortgage loans in the previous calendar year, the corporate surety bond must be
in the amount of $200,000.
(6)
Notwithstanding section (5) of this rule, a person that obtains and maintains one
or more consumer finance licenses in this state may provide a corporate surety bond
in an amount to cover the entire surety amounts required for one or more of the
person’s consumer finance companies in an amount meeting the minimum bond
amounts of sections (5)(a) through (f) of this rule.
Stat.
Auth.: ORS 86A.242
Stats.
Implemented: ORS 86A.227
Hist.:
FCS 3-2010, f. 3-18-10, cert. ef. 3-22-10; FCS 4-2012, f. & cert. ef 8-1-12
441-730-0027
State Criminal Records Check
(1) A consumer finance company that makes or offers to make residential mortgage loans must conduct a state criminal records check of an employee prior to the person originating residential mortgage loans.
(a) The consumer finance company must search state records of all states where the individual has resided in the past 10 years using the person's full legal name, date of birth, place of birth, and Social Security number.
(b) The consumer finance company must use the services of law enforcement agencies or an independent private company that complies with the federal Fair Credit Reporting Act to conduct the state criminal records check.
(2) If the state criminal records check discloses a disqualifying conviction under ORS 86A.212, an applicant for a mortgage loan originator license may not be employed and a currently employed mortgage loan originator must cease making residential mortgage loans immediately.
(3) The consumer finance company must maintain state criminal records check documents in a secure location and must make these available to the director for examination at any reasonable time or times and may require, without subpoena, the production of such records at the office of the director as often as is reasonably necessary. The consumer finance company must preserve these records for three years after they terminate the employment of the mortgage loan originator. After the retention period, the consumer finance company must destroy these files in a secure manner.
(4) This rule applies to employees of consumer finance companies hired or employed on or after August 1, 2010.
Stat. Auth.: ORS 59.972, 86A.242

Stats. Implemented: ORS 59.972

Hist.: FCS 3-2010, f. 3-18-10, cert. ef. 3-22-10

Notes, Mortgages, and Collateral

441-730-0030
Fees, Charges Licensees Pay the Director
(1) In addition to any fees required
to register with and participate in NMLS, an applicant or licensee shall pay:
(a) $600 for an initial application
for each location to be licensed; and
(b) $600 for renewal for
each licensed location, due and payable at the time that the request to renew is
submitted through the NMLS.
(2) The rate of charge payable
by a licensee is $75 an hour per person payable by the licensee for the director
and each examiner and other division employee used in an examination conducted under
ORS 725.312 and for extra services provided a licensee under 725.185(2).
(3) Notwithstanding the rate
of charge fixed by section (2) of this rule:
(a) If an examiner from the
division or the director is required to travel out of state to conduct the examination
or provide extra services, the rate of charge payable by the licensee is $75 an
hour per person, plus actual cost of travel. Actual travel costs include air fare,
lodging, food, car usage out of state, mileage to the Oregon airport and return,
and travel time beginning from the departure time and ending at the departure time
at the destination city;
(b) If the extra services
or examination is performed by a consultant hired by contract for the particular
service or examination, the charge payable by the licensee is the actual cost to
the division of the contract consultant.
(4) As used in this rule,
"extra services" means any attention other than an examination given under ORS 725.310.
(5) In addition to the charges
fixed by sections (2) and (3) of this rule, the director will collect from a licensee
any additional costs directly attributable to extra services given the licensee
under ORS 725.185 or a special examination given the licensee under ORS 725.310.
(6) The director may by order
reduce the fees assessed for any specific year.
Stat. Auth.: ORS 725.185
Stats. Implemented: ORS 725.185
Hist.: FID 8-1985, f. &
ef. 12-31-85; FCS 2-1988, f. 1-29-88, cert. ef. 2-1-88; Renumbered from 805-075-0015;
FCS 12-1988, f. 7-20-88, cert. ef. 8-1-88; FCS 1-1989, f. 1-18-89, cert. ef. 2-1-89;
FCS 1-2001, f. 1-22-01, cert. ef. 2-1-01; FCS 4-2003, f. 12-30-03 cert. ef. 1-1-04;
FCS 4-2004, f. 11-1-04, cert. ef. 1-1-05; FCS 3-2005, f. & cert. ef. 9-6-05;
FCS 1-2008, f.& cert. ef. 1-28-08; FCS 2-2009, f. & cert. ef. 2-3-09; FCS
3-2009, f. & cert. ef. 6-2-09; FCS 6-2010, f. & cert. ef. 6-4-10; FCS 7-2013(Temp),
f. 12-31-13, cert. ef. 1-1-14 thru 6-30-14; Administrative correction, 7-24-14;
FCS 3-2014, f. & cert. ef. 8-25-14
441-730-0050
Notes and Agreements
(1) All forms of notes and agreements pertaining to loans and security for loans used by a licensee must be so worded that they comply with all provisions of ORS Chapter 725 and these rules.
(2) Any forms or agreements required or authorized by federal statute or regulations and in compliance with those statutes or regulations are considered in compliance with and authorized by ORS Chapter 725.
Stat. Auth.: ORS 725.505

Stats. Implemented: ORS 725.120 & 725.320

Hist.: BB 14, f. & ef. 11-15-76; BB 3-1978, f. 5-16-78, ef. 7-1-78; BB 5-1982, f. 9-1-82, ef. 9-15-82; Renumbered from 805-075-0030; FCS 12-1988, f. 7-20-88, cert. ef. 8-1-88; FCS 13-2001, f. & cert. ef. 12-27-01; FCS 5-2006, f. & cert. ef. 12-21-06; FCS 3-2009, f. & cert. ef. 6-2-09; FCS 6-2010, f. & cert. ef. 6-4-10
441-730-0060
Loans Not to Be Payable on Demand; Exception
(1) Except as provided by section (2) of this rule, a loan shall not be made payable on demand.
(2) A loan may provide that, if there is a default under the note or collateral security agreement, the loan may become due and payable immediately or on demand.
Stat. Auth.: ORS 725

Stats. Implemented: ORS 725.050

Hist.: BB 14, f. & ef. 11-15-76; BB 3-1978, f. 5-16-78, ef. 7-1-78; Renumbered from 805-075-0040
441-730-0070
Advertising Regulations
(1) A licensee or other person must not, in any advertisement printed, displayed, published, distributed, or broadcasted, including on the Internet, by the licensee or on the licensee's behalf include any reference to the supervision of the business of the licensee by this state or any department or official of this state, except the phrase "licensed under the Oregon Consumer Finance Act" or "subject to state regulation" or both.
(2) A licensee or other person must not, in any advertisement printed, displayed, published, distributed, broadcast, including on the Internet, by the licensee or on the licensee's behalf, use any name other than the name under which the license is issued.
(3) A licensee must retain a copy of all advertising for the period beginning with the date of the last examination in a designated licensed office, or with the prior approval of the director, at another location until an examiner has reviewed the material.
(4) Notwithstanding the provisions of sections (1) and (2) of this rule:
(a) A licensee that makes and closes the majority of loans in a licensed location must prominently post their license in a manner conspicuous to the public; or
(b) If a licensee makes and closes the majority of loans electronically, they must prominently post their license on their website and at their licensed location in a manner conspicuous to the public.
(5) The posted license shall state that the business is licensed and regulated by the Department of Consumer and Business Services, and will include the Department’s toll-free telephone number for public inquiries or complaints.
Stat. Auth.: ORS 725.505

Stats. Implemented: ORS 725.060

Hist.: BB 14, f. & ef. 11-15-76; BB 5-1982, f. 9-1-82, ef. 9-15-82; Renum?bered from 805-075-0045; FCS 12-1988, f. 7-20-88, cert. ef. 8-1-88; FCS 2-2001, f. 1-22-01, cert. ef. 3-22-01; FCS 13-2001, f. & cert. ef. 12-27-01; FCS 3-2009, f. & cert. ef. 6-2-09; FCS 3-2010, f. 3-18-10, cert. ef. 3-22-10; FCS 6-2010, f. & cert. ef. 6-4-10
441-730-0080
Qualifications of Person in Charge of Licensed Office
(1) A loan licensee must not place any person in charge of a licensed office unless the person has a thorough understanding of ORS chapter 725 and these rules.
(2) A licensee must place the experienced person as described in OAR 441-730-0025(2) in its licensed office.
(3) Notwithstanding section (2) of this rule, if the licensee holds a license for more than one location or if the experienced person described in OAR 441-730-0025(2) is employed outside of Oregon, the licensee may place a qualified person with no less than one year's traditional lending experience in charge of each licensed office provided the experienced person described in OAR 441-730-0025(2) supervises the lending operations of each location.
(4) At the request of the applicant and in the sole discretion of the director, education, extensive training or other business experience may be substituted for the one year of relevant lending experience required in section (3) of this rule.
(5) Unless a licensee requires all loan underwriting decisions be forwarded to an experienced person at another location or uses a formalized grading system, a licensee must employ or place a qualified person as described in this rule at each licensed office to be in charge of and oversee the lending operations of the office. A licensee must provide the director with a current resume for any new manager employed or placed at a licensed office within 30 days of the date of their employment.
Stat. Auth.: ORS 725.505

Stats. Implemented: ORS 725.140, 725.310 & 725.330

Hist.: BB 14, f. & ef. 11-15-76; Renumbered from 805-075-0050; FCS 13-2001, f. & cert. ef. 12-27-01; FCS 2-2004, f. & cert. ef. 8-5-04; FCS 5-2006, f. & cert. ef. 12-21-06; FCS 3-2009, f. & cert. ef. 6-2-09; FCS 6-2010, f. & cert. ef. 6-4-10
441-730-0100
Licensee Officers and Directors
(1)(a) A licensee may add a new executive officer, owner, director, or managing partner at any time after the licensee has been granted a license if after the addition at least one-half of the executive officers, owners, directors, or managing partners can demonstrate verifiable recent lending experience in banking, consumer finance, or mortgage lending as required by OAR 441-730-0025.
(b) If a licensee adds a new executive officer, director, partial owner, or managing partner under this section, the licensee must provide a current resume for such new persons demonstrating verifiable recent lending experience in banking, consumer finance, or mortgage lending to the director within 30 days of their appointment or selection.
(2) If an existing or new executive officer, director, partial owner, or managing partner of the licensee gains a controlling interest in the company after the license has been granted, the licensee must notify the director within 30 days.
(3) An officer or director of a licensee addressed in an order issued by the director under ORS 725.315 or 725.317 may, within 30 days after the date the order is issued and served, request a hearing on the order as provided for contested cases by 183.310 to 183.500, and the rules of the director adopted pursuant thereto.
(4) A person who is suspended or removed under ORS 725.315 or 725.317 must not conduct any of the business of the licensee or have access to the books, records, or assets of the licensee either as an officer, director, partner, stockholder, or employee without receiving permission from the director:
(a) During the period of the suspension; or
(b) After the effective date of the removal.
(5) A licensee subject to an order of suspension under the provisions of ORS 725.230(2) may, within 90 days after the date the order is issued or served, request a hearing on the order as provided for contested cases by 183.310 to 183.500 and the rules of the director adopted pursuant thereto.
Stat. Auth.: ORS 725.505

Stats. Implemented: ORS 725.315 & 725.317

Hist.: BB 3-1978, f. 5-16-78, ef. 7-1-78; Renumbered from 805-075-0057; FCS 12-1988, f. 7-20-88, cert. ef. 8-1-88; FCS 13-2001, f. & cert. ef. 12-27-01; FCS 2-2004, f. & cert. ef. 8-5-04; FCS 3-2009, f. & cert. ef. 6-2-09; FCS 6-2010, f. & cert. ef. 6-4-10
441-730-0110
Accounting Records of Licensee
(1) The accounting records of a licensee must reflect a complete segregation of the loan transactions from any other business in which the licensee may be engaged.
(2) The licensee must maintain separate control accounts or other acceptable records to reflect such segregation for:
(a) Loans receivable;
(b) Charges; and
(c) Repossessed property and sales of repossessed property.
(3) The receipt and disbursement of all charges charged or collected must be fully accounted for.
(4) Each licensee must maintain a log of:
(a) Loans made, listing each loan in sequence by number or date of loan and showing:
(A) The amount of the loan;
(B) The type of security taken;
(C) The rate of interest charged; and
(D) The types of insurance for which premium charges have been made in connection with the loan and which are payable by the borrower.
(b) Loans prepaid in full by credit life insurance showing for each loan so paid;
(A) The borrower's name and account number;
(B) The date of death of the borrower;
(C) The date proof of death was received by the licensee; and
(D) The disposition of the insurance proceeds with substantiating documents.
(c) Any litigation initiated by the licensee showing for each proceeding:
(A) The borrower's name and account number;
(B) The court where the proceeding is filed;
(C) The date of filing; and
(D) When applicable, the date, and terms of any disposition of the matter.
(d) Information on files sent to a collection agency showing, for each file:
(A) The borrower's name, the account number;
(B) The original date of the loan, the due date of the loan, or last renewal or extension;
(C) The date the loan was sent to the collection agency;
(D) The name of the collection agency; and
(E) The date and amount of monies received from the collection agency.
(F) A separate log of files sent to a collection agency need not be maintained provided the information is available in existing records at the time of examination.
(5) Any public or private sale of repossessed property by a licensee must be made in good faith and in a commercially reasonable manner. If there is no recognized market for the property, such as a motor vehicle auction house or similar sales process that is commonly used to sell property of the kind repossessed by the licensee, prior to a private sale of repossessed property, the licensee must obtain, from persons who are not directly or indirectly related to the licensee, sufficient written bids to establish market value. The written bid must contain sufficient information to identify the property being bid on.
(6) When a judgment is entered in a court proceeding initiated by a licensee on a loan, the licensee forthwith must place in the related loan file either:
(a) A copy of the judgment entered in the proceeding; or
(b) A statement verified by a representative of the licensee, detailing the essential provisions of the judgment.
Stat. Auth.: ORS 725.320 & 725.505

Stats. Implemented: ORS 725.330

Hist.: BB 14, f. & ef. 11-15-76; BB 5-1982, f. 9-1-82, ef. 9-15-82; Renumbered from 805-075-0060; FCS 12-1988, f. 7-20-88, cert. ef. 8-1-88; FCS 2-2000, f. & cert. ef. 2-15-00; FCS 2-2001, f. 1-22-01, cert. ef. 3-22-01; FCS 13-2001, f. & cert. ef. 12-27-01; FCS 3-2009, f. & cert. ef. 6-2-09; FCS 6-2010, f. & cert. ef. 6-4-10
441-730-0120
Account Record to Be Maintained for Each Loan
(1) The licensee must maintain a separate individual account record for each loan made to any borrower showing:
(a) The loan number;
(b) The date of the loan;
(c) The name and address of the borrower;
(d) A brief description of the security, if any;
(e) The agreed interest rate or rates and the amount of each charge, if any;
(f) The terms of repayment, including the expiration date of the loan, and any modifications of the terms.
(g) The amount of each payment made on the loan and in accordance with sections (2) and (3) of this rule, how the payment is allotted to principal, interest and charges;
(h) The date of the final entry when the loan is paid in full or otherwise finally settled or closed; and
(i) A clear, brief explanation of any other entries that result in the reduction or addition to the principal balance or interest.
(2) The account record for a daily interest loan must show, for each loan payment received:
(a) The amount, if any, applied to interest;
(b) The date to which the interest is paid;
(c) If payment is insufficient to pay interest to date, the dollar amount short;
(d) The amount applied to principal, if any; and
(e) The unpaid principal balance of the loan, if any.
(3) The account record for a precomputed-interest loan may comply with section (2) of this rule or it must show, for each loan payment received:
(a) The amount of the payment applied to installments, identifying which installments;
(b) The amount applied to any default charges; and
(c) The unpaid balance of the loan and charges, if any.
(4) When a licensee makes advances to perform covenants, the account record must specify:
(a) The amount of the advance which is added to the principal of the loan.
(b) A brief description of what the advance is paying; and
(c) When the advance is to purchase insurance coverage, the type and extent of coverage.
(5) All entries to the account record made by the licensee must be accurate and posted by close of business on the day the transaction occurred. If the licensee is unable to post a transaction as required by this section, the posting when made must reflect the actual date of the transaction.
Stat. Auth.: ORS 725.320 & 725.505

Stats. Implemented: ORS 725.330

Hist.: BB 14, f. & ef. 11-15-76; BB 5-1982, f. 9-1-82, ef. 9-15-82; Renum?bered from 805-075-0065; FCS 2-2000, f. & cert. ef. 2-15-00; FCS 2-2001, f. 1-22-01, cert. ef. 3-22-01; FCS 13-2001, f. & cert. ef. 12-27-01; FCS 5-2006, f. & cert. ef. 12-21-06; FCS 3-2009, f. & cert. ef. 6-2-09; FCS 6-2010, f. & cert. ef. 6-4-10
441-730-0125
Residential Borrower Files for Mortgage Loans
(1) In addition to any records required to be kept under OAR 441-730-0110 and 441-730-0120, a consumer finance company that makes or offers to make a residential mortgage loan must ensure that the following are prepared and maintained in the loan file:
(a) A summary of the key terms of the approval of the loan;
(b) A copy of each residential mortgage loan application with the signature and the unique identifier of the mortgage loan originator who took or received the application, who offered to negotiate or negotiated the loan, or who closed the loan;
(c) A copy of all documentation relied upon in making the loan decision;
(d) A copy of the borrower executed note and executed trust deed;
(e) A copy of all correspondence with the borrower in writing or in a format easily converted to writing;
(f) A copy of the good faith estimate prepared under Regulation X, 24 C.F.R. Part 3500 and translated as applicable to comply with ORS 86A.198;
(g) If required to be prepared for the residential mortgage transaction, a copy of the final credit report, or the report relied upon for the loan decision, if other than the final credit report, received on the borrower including documentation of borrower payment history;
(h) If required to be prepared for the Oregon residential mortgage transaction, a copy of any disclosure required by Regulation Z, 12 C.F.R. Part 226 and translated as applicable to comply with ORS 86A.198, including, but not limited to, the Truth in Lending disclosure statement;
(i) A copy of the final HUD-1 settlement statement required by 24 C.F.R. Part 3500; and
(j) A copy of the statement that notifies the borrower that loan documents associated with the transaction will be in English and that advises the borrower to obtain appropriate assistance, with any necessary translations as required by ORS 86A.195.
(2) Records retained under this rule may be kept in a written format or in a format easily converted to writing.
Stat. Auth.: ORS 86A.242

Stats. Implemented: ORS 725.230

Hist.: FCS 3-2010, f. 3-18-10, cert. ef. 3-22-10
441-730-0130
Maintaining Index of Obligors
A licensee must maintain in each of its licensed offices an alphabetical index or other index system approved by the director, of every person obligated, directly or contingently, on a loan serviced at that office.
Stat. Auth.: ORS 725

Stats. Implemented: ORS 725.330

Hist.: BB 14, f. & ef. 11-15-76; BB 5-1982, f. 9-1-82, ef. 9-15-82; Renumbered from 805-075-0070; FCS 13-2001, f. & cert. ef. 12-27-01; FCS 6-2010, f. & cert. ef. 6-4-10
441-730-0140
Records and Files Required to Be Kept at Servicing Office; Copies of Loans Transferred; Centralized Accounting Office Exception
(1) A licensee must maintain the accounting records and loan files for active loans at the licensed office where the loans are serviced.
(2) Whenever an active loan is for any reason transferred to another licensed office in this state, the licensee must retain in the transferring office an exact copy of the individual account record and supporting legal documents.
(3) Whenever an active loan is for any reason transferred to another licensed office, the licensee must retain in the transferring office an exact copy of the account record to which has been added the date of transfer and the name and address of the new location of the account. However, if a bulk sale or similar transfer of loans not in the ordinary course of business is made to another licensed office, the licensee may, with the prior approval of the director, make other provisions for the retention of copies of records and files and for the examination of accounts in the receiving office.
(4) Whenever a licensee sends an active loan to another licensed location, the licensee must retain the original record or an exact copy of the account record in the originating office.
(5) Notwithstanding sections (1) through (4) of this rule, a licensee may, with the prior approval of the director, maintain the accounting records and loan files for active loans at a location other than the servicing office if:
(a) The other location is established by the licensee to provide centralized accounting for one or more licensed offices;
(b) Off-site maintenance of the records and files will not hinder prompt servicing of the loans by the servicing offices;
(c) The director, and any duly appointed examiners or agents of the director, have the right of free access to the records and files of the licensee at the other location; and
(d) The other location provides adequate security for the licensee's records and files.
Stat. Auth.: ORS 725.320 & 725.505

Stats. Implemented: ORS 725.330

Hist.: BB 14, f. & ef. 11-15-76; BB 5-1982, f. 9-1-82, ef. 9-15-82; BB 1-1983, f. 3-29-83, ef. 4-1-83; Renumbered from 805-075-0075; FCS 2-2000, f. & cert. ef. 2-15-00; FCS 2-2001, f. 1-22-01, cert. ef. 3-22-01; FCS 6-2010, f. & cert. ef. 6-4-10

Computation of Interest and Charges

441-730-0150
Consolidating Sales Financing into Direct Loans
(1) A licensee shall not make a direct loan to pay off a retail installment contract owned by or assigned to the licensee if the loan bears a higher APR than that borne by the contract unless the loan is of substantial benefit to the borrower. A substantial benefit would exist in circumstances including, but not limited to one or more of the following:
(a) The retail installment contract is in default two installments or more;
(b) The amount of the individual installments payable on the direct loan will be lower than the amount of the individual installment being paid on the contract;
(c) The direct loan pays off one or more obligations in addition to the retail installment contract;
(d) The principal amount of the direct loan exceeds the sum of the unpaid installments on the retail installment contract by not less than 20 percent of the sum of the unpaid installments, or by $200, whichever is less.
(2) As used in this rule, "retail installment contract" has the meaning given the term by ORS 83.010 and 83.510.
Stat. Auth.: ORS 725.505

Stats. Implemented: ORS 725.320

Hist.: BB 3-1978, f. 5-16-78, ef. 7-1-78; BB 5-1982, f. 9-1-82, ef. 9-15-82; Renumbered from 805-075-0103; FCS 12-1988, f. 7-20-88, cert. ef. 8-1-88; FCS 13-2001, f. & cert. ef. 12-27-01; FCS 3-2009, f. & cert. ef. 6-2-09
441-730-0160
Daily-Interest Computation
(1) When interest on a loan is computed on a daily basis using a 360-day factor, the maximum charge for each day must be 1/30 of the monthly rate. In determining the elapsed time to compute interest on any such loan, each calendar month shall be treated as containing 30 days. However, when the period for which interest is computed includes the last day of the month:
(a) If the month has 31 days, the 31st day must be ignored:
(b) If the month is February, two days must be added to the period, except in leap year when only one day may be added.
(2) Interest on a loan may be computed on a daily basis using a 365-day factor or, in a leap year, a 366-day factor. In determining the elapsed time to compute interest or a refund of interest, on such a loan, the maximum charge for each day must be 1/365th of the annual rate, except in a leap year when the maximum charge for each day must be 1/366th of the annual rate.
Stat. Auth. ORS 725.320 & 725.505

Stats. Implemented ORS 725.340

Hist.: BB 14, f. & ef. 11-15-76; Renumbered from 805-075-0105; FCS 2-2000, f. & cert. ef. 2-15-00; FCS 2-2001, f. 1-22-01, cert. ef. 3-22-01; FCS 2-2004, f. & cert. ef. 8-5-04; FCS 6-2010, f. & cert. ef. 6-4-10
441-730-0170
Precomputed Interest
(1) When a loan contract is repayable in substantially equal and consecutive monthly installments of principal and interest combined, interest may be precomputed and added to the principal. Interest may be precomputed even though the first installment period is more or less than one month.
(2) If the first installment period exceeds one month, the amount of the agreed monthly interest charge must be reduced for the first period by 1/30th of the amount for each extra day in the first period. If the first installment period is less than one month the amount of the agreed monthly interest charge must be reduced for the first period by 1/30th of the amount for each day that the first installment period is less than one month.
Stat. Auth.: ORS 725.320 & 725.505

Stats. Implemented: ORS 725.340

Hist.: BB 14, f. & ef. 11-15-76; BB 5-1982, f. 9-1-82, ef. 9-15-82; Renumbered from 805-075-0110; FCS 12-1988, f. 7-20-88, cert. ef. 8-1-88; FCS 2-2000, f. & cert. ef. 2-15-00; FCS 3-2009, f. & cert. ef. 6-2-09; FCS 6-2010, f. & cert. ef. 6-4-10
441-730-0180
Deferred Payment on Precomputed Loan
(1) When unpaid installments are deferred as provided by ORS 725.340(2)(b), the licensee must give the borrower written evidence of the agreed deferral showing:
(a) The amount of the deferral charge;
(b) The new due date of the first deferred installment; and
(c) The new due date of the final deferred installment of the loan.
(2) The licensee must also note the due date of the final deferred installment and the amount of the deferral charge on the borrower's account record.
Stat. Auth.: ORS 725.505

Stats. Implemented: ORS 725.340(2)

Hist.: BB 14, f. & ef. 11-15-76; BB 3-1978, f. 5-16-78, ef. 7-1-78; BB 5-1982, f. 9-1-82, ef. 9-15-82; Renumbered from 805-075-0120; FCS 2-2001, f. 1-22-01, cert. ef. 3-22-01; FCS 3-2009, f. & cert. ef. 6-2-09; FCS 6-2010, f. & cert. ef. 6-4-10
441-730-0200
Action on Precomputed Loan; Rebate Required
(1) When a licensee brings an action against a borrower on a precomputed loan, if the action comes to judgment prior to the due date of the final installment, the licensee must tender a rebate to the borrower of interest unearned as of the date of the judgment. The rebate must be computed in accordance with ORS 725.340(2)(c) as if the loan were prepaid in full on the date of the judgment.
(2) Rebate of any deferral charge must be determined on the US Actuarial Rule.
(3) Licensees may collect prejudgment interest awarded by the court, but may not estimate interest based upon an estimate of the judgment date.
Stat. Auth.: ORS 725.320 & 725.505

Stats. Implemented: ORS 725.340

Hist.: BB 14, f. & ef. 11-15-76; BB 3-1978, f. 5-16-78, ef. 7-1-78; BB 5-1982, f. 9-1-82, ef. 9-15-82; Renumbered from 805-075-0130; FCS 12-1988, f. 7-20-88, cert. ef. 8-1-88; FCS 2-2000, f. & cert. ef. 2-15-00; FCS 13-2001, f. & cert. ef. 12-27-01; FCS 3-2009, f. & cert. ef. 6-2-09; FCS 6-2010, f. & cert. ef. 6-4-10
441-730-0205
Limitation on Charging a Prepayment Penalty by Consumer Finance Licensees
A licensee may not charge a penalty for prepayment of all or part of the unpaid balance of a loan where:
(1) A licensee refinances a loan they own.
(2) The licensee has repossessed any collateral offered for the loan, sold the collateral and applied the proceeds of the sale towards the unpaid balance of the loan.
(3) The licensee forecloses on property and applies any proceeds realized from the foreclosure toward the unpaid balance of the loan.
(4) The licensee exercises an option contained in the loan agreement to require immediate repayment of all or part of the unpaid balance of the loan.
(5) All or part of the loan balance is repaid with insurance benefits resulting from the death of the borrower.
(6) The licensee demands repayment of all or part of the unpaid balance of the loan.
(7) The loan is a home equity line of credit or an unsecured line of credit.
Stat. Auth.: ORS 725.320 & 725.505

Stats. Implemented: ORS 725.360

Hist.: FCS 2-2000, f. & cert. ef. 2-15-00; FCS 2-2001, f. 1-22-01, cert. ef. 3-22-01; FCS 3-2009, f. & cert. ef. 6-2-09; FCS 6-2010, f. & cert. ef. 6-4-10
441-730-0210
Recomputation of Interest on Delinquent Precomputed Loan
If two or more installments of a precomputed loan are delinquent, the licensee may elect to recompute interest and other charges. A recomputation shall be made at the agreed interest rate, or at the APR, from the date the loan was made, on actual unpaid balances, until the date the loan is paid in full. When such an election is made, the licensee shall recompute the interest charges from the date of the loan to the date of the election by applying every payment received prior to the election first to interest and then to the unpaid principal as of the date the payment was received. Recomputed interest so received is in lieu of the precomputed interest, including any deferral charges, and default charges which accrued prior to the date of the election.
Stat. Auth.: ORS 725.505

Stats. Implemented: ORS 725.340

Hist.: BB 14, f. & ef. 11-15-76; BB 3-1978, f. 5-16-78, ef. 7-1-78; BB 5-1982, f. 9-1-82, ef. 9-15-82; Renumbered from 805-075-0135; FCS 3-2009, f. & cert. ef. 6-2-09
441-730-0220
Insurance Premium Charges; Refunds
If a loan contract is prepaid in full by cash, renewal, refinancing, or a new loan, one month or more before the final installment due date, the licensee shall refund to the borrower that proportion of the credit life and credit health insurance premium collected which the sum of the monthly balances scheduled to follow the installment date nearest the date of prepayment in full bears to the sum of all scheduled monthly balances, as computed in accordance with the rule commonly know as the "rule of seventy-eights." However, a licensee is not required to make a refund if the unearned insurance premium is less than $2 and the loan is prepaid in full by cash.
Stat. Auth.: ORS 725

Stats. Implemented: ORS 725.340

Hist.: BB 14, f. & ef. 11-15-76; BB 5-1982, f. 9-1-82, ef. 9-15-82; Renumbered from 805-075-0145
441-730-0230
Insurance Benefits Paid to Licensee
(1) When a death claim settlement is made on a borrower's account and the credit life insurance premium charged was based on the total of installments contracted, including both principal and anticipated interest, the licensee shall credit the borrower's account or estate in an amount not less than the total of all installments including both principal and unearned interest which were insured and scheduled to follow the date of the borrower's death. The licensee is entitled to accrue interest for not to exceed 30 days after proof of death is received by the licensee or until the date the insurance check is received, whichever is first to occur. A copy of the insurance check shall be retained in the file for auditing purposes.
(2) If premium charges for other types of credit life and credit health insurance have been charged to the account of the deceased borrower, the unearned charges shall also be credited to the borrower's account or estate from date of death.
Stat. Auth.: ORS 725

Stats. Implemented: ORS 725.340

Hist.: BB 14, f. & ef. 11-15-76; BB 5-1982, f. 9-1-82, ef. 9-15-82; Renumbered from 805-075-0150

Licensee's Duties to Borrower

441-730-0240
Statement of Loan
(1) In addition to the statement required by ORS 725.360(1), the licensee shall, at the time each loan is made, deliver to the borrower:
(a) A written statement that payment in any amount may be made in advance at any time and, if the loan contains a prepayment penalty, the statement shall comply with the notice required by ORS 82.160(1).
(b) A detailed schedule showing the manner in which the proceeds of the loan have been disbursed or are to be disbursed on behalf of the borrower, including:
(A) Amounts applied to payment of the balance of an existing loan with the licensee;
(B) Amounts paid to others as authorized and designated by the borrower;
(C) Amounts paid for insurance premiums, itemizing the types of insurance that the borrower has approved in writing and, if the coverage of any policy is less than the principal balance or the full term of the loan, state the balance and term covered.
(D) Amounts paid for other identifiable charges the borrower has approved in writing;
(E) Amounts retained for filing, releasing, recording, satisfaction, reconveyance, license, title transfer, and similar fees, itemizing the purpose of each fee; and
(F) Amounts remaining that will be paid to the borrower.
(c) When requested by the borrower, a copy of the security agreement, trust deed, or mortgage signed by the borrower, together with any attached schedule of property pledged by the borrower.
(2) When copies are requested by any other person obligated directly or contingently on the loan, the licensee shall also deliver a copy of the statements and other documents required by ORS 725.360(1) and section (1) of this rule to such other person whether the person is obligated as a maker, co-maker guarantor, accommodation maker, endorser or otherwise.
(3) The statement required by section (1) of this rule may include disclosures under applicable federal law that a licensee is required to make to the borrower at the time the loan is made.
(4) The licensee shall retain a copy of the statement of loan delivered to the borrower for at least two years after final entry has been made on the loan records.
Stat. Auth.: ORS 725

Stats. Implemented: ORS 725.330, ORS 725.340 & ORS 725.360

Hist.: BB 14, f. & ef. 11-15-76; BB 3-1978, f. 5-16-78, ef. 7-1-78; BB 5-1982, f. 9-1-82, ef. 9-15-82; Renumbered from 805-075-0170; FCS 6-2001(Temp), f. 6-29-01, cert. ef. 7-1-01 thru 12-25-01; FCS 13-2001, f. & cert. ef. 12-27-01
441-730-0246
Contents of Foreclosure Notices
The sender of a notice form
required by ORS 86.737 must enter in the form and format adopted by this rule:
(1) The statewide telephone
contact number for handling consumer queries as 855-480-1950;
(2) The telephone number of
the Oregon State Bar’s Lawyer Referral Service as 503-684-3763;
(3) The Oregon State Bar’s
Lawyer Referral Service toll-free number as 800-452-7636;
(4) The website address of the
Oregon State Bar as: http://www.osbar.org;
(5) The website address for
the organization providing more information and a directory of legal aid programs
as http://www.oregonlawhelp.org
(6) The toll-free consumer mortgage
foreclosure information number as 855-480-1950; and
(7) Information on federal loan
modification programs as http://www.makinghomeaffordable.gov/.
Stat. Auth.: ORS 86.737
Stats. Implemented: ORS 86.737

Hist.: FCS 9-2008, f. 10-15-08,
cert. ef. 10-16-08; FCS 6-2009(Temp), f. 8-21-09 thru 2-17-10; FCS 11-2009, f. 12-2-09,
cert. ef. 12-7-09; FCS 6-2010, f. & cert. ef. 6-4-10; FCS 13-2011(Temp), f.
& cert. ef. 12-15-11 thru 6-12-12; Administrative correction, 6-27-12
441-730-0250
Receipt to Be Furnished to Borrower Upon Request
(1) When the borrower requests a receipt for a payment on a loan for which interest is to be computed on a daily basis, the receipt shall specify:
(a) The amount applied to interest, if any;
(b) The date to which the interest is paid, or the dollar amount short, if payment is insufficient to pay interest to date;
(c) The amount applied to principal, if any; and
(d) The unpaid principal of such loan, if any.
(2) When a borrower requests a receipt for a payment on a loan that is contracted for interest to be precomputed, the receipt shall specify:
(a) The amount of the payment applied to the loan and any default charges; and
(b) The amount of the unpaid balance of the loan and charges, if any.
Stat. Auth.: ORS 725.505

Stats. Implemented: ORS 725.360

Hist.: BB 14, f. & ef. 11-15-76; BB 5-1982, f. 9-1-82, ef. 9-15-82; Renumbered from 805-075-0175; FCS 2-2001, f. 1-22-01, cert. ef. 3-22-01; FCS 13-2001, f. & cert. ef. 12-27-01; FCS 3-2009, f. & cert. ef. 6-2-09
441-730-0255
Payoff Information to be Furnished to Borrower Upon Request
(1) When a borrower requests the payoff information on a loan and specifies a payoff date, the licensee must promptly, but in no case later than three business days, provide the requested information.
(2) When a borrower does not specify a payoff date, the licensee must calculate the payoff amount for a date no later than 10 days after the date of the request, and the amount must be provided within three business days of the borrower’s request. When a licensee provides a payoff amount, it must also advise the borrower, verbally or in writing, that interest will continue to accrue past the payoff date if the loan is not paid in full.
Stat. Auth.: ORS 725.505

Stats. Implemented: ORS 725.360

Hist.: FCS 5-2006, f. & cert. ef. 12-21-06; FCS 3-2009, f. & cert. ef. 6-2-09; FCS 6-2010, f. & cert. ef. 6-4-10
441-730-0260
Advances to Perform Covenants
(1) Within a reasonable time after advancing any sum pursuant to ORS 725.340(3), the licensee must furnish the borrower a written statement showing:
(a) The amount of the sums advanced and, any charges with respect to such sums advanced;
(b) Any revised payment schedule; and, if the duties of the borrower performed by the licensee pertain to insurance.
(c) A brief description of the types of insurance paid for the by licensee.
(2) The amount advanced by the licensee may be added to the unpaid balance of the loan and may bear interest not to exceed the rate permitted by ORS 725.340(3). However, a licensee may not advance any sums under ORS 725.340(3) or add any such advances to the unpaid balance of a loan unless the borrower's loan contract provides for such advances and additions.
Stat. Auth.: ORS 725

Stats. Implemented: ORS 725.340(3)

Hist.: BB 14, f. & ef. 11-15-76; BB 5-1982, f. 9-1-82, ef. 9-15-82; Renumbered from 805-075-0180; FCS 13-2001, f. & cert. ef. 12-27-01; FCS 6-2010, f. & cert. ef. 6-4-10
441-730-0280
Prohibited Provisions in Loan Contract Provisions
A licensee may not use a contract evidencing a loan that contains any of the following provisions:
(1) A hold harmless clause;
(2) A confession of judgment or other waiver of the right to notice and the opportunity to be heard in the event of suit or process;
(3) A provision in which the consumer agrees not to assert any claim or defense arising out of the contract against the licensee or any holder in due course.
(4) An executory waiver or a limitation of exemption from attachment, execution, or other process on real or personal property held, owned by, or due to the consumer, unless the waiver applies solely to property subject to a security interest executed in connection with the loan.
Stat. Auth.: ORS 725.505

Stats. Implemented: ORS 725.360

Hist.: FCS 2-2001, f. 1-22-01, cert. ef. 3-22-01; FCS 4-2001, f. & cert. ef. 3-27-01; FCS 6-2001(Temp), f. 6-29-01, cert. ef. 7-1-01 thru 12-25-01; FCS 13-2001, f. & cert. ef. 12-27-01; FCS 3-2009, f. & cert. ef. 6-2-09; FCS 6-2010, f. & cert. ef. 6-4-10
441-730-0320
Licensee Reporting
(1)
Licensees are required to file their annual report by March 31 of each year. Licensees
must also provide known information on any felony conviction, or any conviction
involving theft or fraud, of any executive officer, director, managing partner,
or the manager of any office location that occurred during the reporting period
that had not already been reported to the director. This applies to:
(a)
A new qualified person or office manager;
(b)
A new experienced person;
(c)
Material changes in business plan; or
(d)
Any criminal conviction entered against any person named in the application.
(2)(4)
In addition, a consumer finance licensee employing one or more mortgage loan originators
shall file a report of condition with the National Mortgage Licensing System and
Registry of the consumer finance licensee’s business and operations in Oregon
related to residential mortgage transactions. The report shall be filed within 45
days following the end of each calendar quarter.
Stat.
Auth.: ORS 725.505, 86A.242
Stats.
Implemented: ORS 725.190, 86A.239
Hist.:
FCS 2-2001, f. 1-22-01, cert. ef. 3-22-01; FCS 5-2006, f. & cert. ef. 12-21-06;
FCS 3-2009, f. & cert. ef. 6-2-09; FCS 3-2010, f. 3-18-10, cert. ef. 3-22-10;
FCS 6-2010, f. & cert. ef. 6-4-10; FCS 4-2012, f. & cert. ef. 8-1-12

The official copy of an Oregon Administrative Rule is
contained in the Administrative Order filed at the Archives Division,
800 Summer St. NE, Salem, Oregon 97310. Any discrepancies with the
published version are satisfied in favor of the Administrative Order.
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Read Entire Law on arcweb.sos.state.or.us