Section 75-17-21 - Maximum finance charges by licensees under Small Loan Regulatory Law and Small Loan Privilege Tax Law; lender option to use rates under this section or Section 75-67-181(1) For any consumer installment loan that a licensee under the Small Loan Regulatory Law and the Small Loan Privilege Tax Law makes, the licensee has the option to either lend at the rates and fees indicated under this section or at the rates and charges authorized under Section 75-67-181. Except as provided in Section 75-67-181, but notwithstanding any other provision of law to the contrary, the maximum finance charge which may be contracted for and received for any loan or extension of credit made by a licensee under the Small Loan Regulatory Law (Section 75-67-101 et seq.) and the Small Loan Privilege Tax Law (Section 75-67-201 et seq.) may result in a yield not to exceed the following annual percentage rates calculated according to the actuarial method: (a) Thirty-six percent (36%) per annum for the portion of the unpaid balance of the amount financed that is not greater than One Thousand Dollars ($1,000.00);(b) Thirty-three percent (33%) per annum for the portion of the unpaid balance of the amount financed in excess of One Thousand Dollars ($1,000.00) but not greater than Two Thousand Five Hundred Dollars ($2,500.00);(c) Twenty-four percent (24%) per annum for the portion of the unpaid balance of the amount financed in excess of Two Thousand Five Hundred Dollars ($2,500.00) but not greater than Five Thousand Dollars ($5,000.00);(d) Fourteen percent (14%) per annum for the portion of the unpaid balance of the amount financed in excess of Five Thousand Dollars ($5,000.00).(2) As an alternative and in lieu of the rates established in paragraphs (a), (b), (c) and (d) of subsection (1), on loans in an amount of Twenty-five Thousand Dollars ($25,000.00) or more, a licensee may contract for and receive a maximum finance charge which will result in a yield not to exceed an annual percentage rate, calculated according to the actuarial method, of eighteen percent (18%) per annum on the unpaid balance of the amount financed.(3) A licensee choosing to lend at the rates indicated under this section may contract for and charge a closing fee as follows: (a) For loans in the amount of Ten Thousand Dollars ($10,000.00) or less, four percent (4%) of the total payments due on the loan or Twenty-five Dollars ($25.00), whichever is greater;(b) For loans in an amount greater than Ten Thousand Dollars ($10,000.00), a maximum charge of Five Hundred Dollars ($500.00). Such closing fee shall not be part of the finance charge.
(4) The rates set forth in paragraph (a) of subsection (1) may be increased by the number of percentage points by which the discount rate, excluding any surcharge thereon, on ninety-day commercial paper in effect at the Federal Reserve bank in the Federal Reserve district where the lender is located exceeds eight percent (8%), and the rates set forth in paragraphs (b), (c) and (d) of subsection (1) may be increased by the number of percentage points by which the discount rate, excluding any surcharge thereon, on ninety-day commercial paper in effect at the Federal Reserve bank in the Federal Reserve district where the lender is located exceeds ten percent (10%).(5) Except as provided in Section 75-67-181, the finance charges authorized in this section are the maximum rates which may be contracted for or received for any loan or extension of credit made by a licensee under the Small Loan Regulatory Law (Section 75-67-101 et seq.), and the Small Loan Privilege Tax Law (Section 75-67-201 et seq.). Nothing in this section shall prohibit lending money or handling, negotiating or arranging loans for a finance charge that is less than that specified herein. This section does not limit or restrict the manner of contracting for the finance charge, whether by way of add-on, discount or otherwise, so long as the annual percentage rate of the finance charge does not exceed that permitted by this section or Section 75-67-181.Laws, 1986, ch. 510, § 3; Laws, 2005, ch. 438, § 1, eff. 7/1/2005.Amended by Laws, 2016, ch. 301, HB 1511, 8, eff. 7/1/2016.