PAWNBROKERS AND MONEYLENDERS
REGULATION OF SMALL LOANS, TITLE LOANS, AND PAYDAY LOANS
399-A:17 Payday Loan Lenders.
I. The annual percentage rate for payday loans shall not exceed 36 percent.
II. Each payday loan lender shall conspicuously post in its licensed location a schedule of interest charges, with examples using a $300 loan payable in 14 days and 30 days. Payday loans shall incur interest only. No other charges or fees shall apply to or be collected on payday loans.
III. Each payday loan shall be evidenced by a written loan agreement, which shall be signed by the borrower and a person authorized by the lender to sign such agreements and dated the same day the loan is made and disbursed. The lender shall give a duplicate original of the loan agreement to the borrower at the time of the transaction. The loan agreement shall set forth, at a minimum:
(a) The principal amount of the loan.
(b) The interest charged.
(c) The annual percentage rate, which shall be stated using that term, applicable to the transaction.
(d) Evidence of receipt from the borrower of a check or other account debit authorization, dated the same date, as security for the loan, stating the amount of the check, if a check or other account debit authorization was given by the borrower.
(e) An agreement by the lender not to present the check or other account debit authorization for payment or deposit until a specified maturity date, which date shall be at least 7 days and not more than 30 days after the date the loan is made and after which date interest shall not accrue at a greater rate than 6 percent per year, if a check or other account debit authorization was given by the borrower.
(f) An agreement by the lender that the borrower shall have the right to cancel the loan transaction at any time before the close of business of the next business day following the date of the transaction by paying to the lender, in the form of cash or other funds instrument, the amount advanced to the borrower.
(g) An agreement that the borrower shall have the right to prepay the loan in full or in part prior to maturity by paying the lender the principal amount advanced and any accrued and unpaid interest.
IV. A payday loan lender shall not obtain any agreement from the borrower:
(a) Giving the lender or any third person power of attorney or authority to confess judgment for the borrower;
(b) Authorizing the lender or any third party to bring suit against the borrower in a court outside the state; or
(c) Waiving any right the borrower has under this chapter.
V. A payday loan lender shall not require, or accept, more than one check from the borrower as security for any loan at any one time.
VI. A payday loan lender shall not cause any person to be obligated to the lender in any capacity at any time in the principal amount of more than $500.
VII. A payday loan lender shall not refinance, renew, or extend any loan.
VIII. A payday loan lender shall not cause a borrower to be obligated upon more than one loan at any time for the purpose of increasing charges payable by the borrower.
IX. A payday loan lender shall not require or accept a post-dated check as security for, or in payment of, a loan.
X. A payday loan lender shall not threaten, or cause to be instigated, criminal proceedings against a borrower if a check given as security for a payday loan is dishonored.
XI. A payday loan lender shall not take an interest in any property other than a check payable to the payday loan lender as security for a payday loan.
XII. A payday loan lender shall not make a loan to a borrower to enable the borrower to pay for any other product or service sold at the payday loan lender's business location.
XIII. Loan proceeds shall be disbursed in cash or by the payday loan lender's business check. No fee shall be charged by the payday loan lender or an affiliated check cashier for cashing a loan proceeds check.
XIV. A check given as security for a loan shall not be endorsed to a third party.
XV. Upon receipt of a check given as security for a loan, the payday loan lender shall stamp the check with an endorsement stating "This check is being negotiated as part of a payday loan pursuant to RSA 399-A, and any holder of this check takes it subject to all claims and defenses of the maker."
XVI. Before entering into a payday loan, the payday loan lender shall provide each borrower with a pamphlet explaining in plain language the rights and responsibilities of the borrower and providing a toll-free number in the banking department for assistance with complaints. The commissioner may prescribe the form of the pamphlet by rule.
XVII. Before disbursing funds pursuant to a payday loan, a payday loan lender shall provide a clear and conspicuous printed notice to the borrower indicating that a payday loan is not intended to meet long-term financial needs and that the borrower should use a payday loan only to meet short-term cash needs.
XVIII. A borrower shall be permitted to make partial payments, in increments of not less than $50 on the loan at any time prior to maturity without charge. The payday loan lender shall give the borrower signed, dated receipts for each payment made, which shall state the balance due on the loan.
XIX. A payday loan lender shall not make a loan to a borrower who currently has an outstanding or who has had an outstanding payday or title loan within the previous 60-day period. As part of its application process for such a loan, a payday loan lender shall obtain a written statement under oath from the borrower certifying the borrower does not currently have an outstanding and has not had an outstanding payday loan or title loan within the previous 60-day period.
XX. Each payday loan lender shall maintain an office in this state that is accessible to consumers.
Source. 2015, 73:1, eff. Jan. 1, 2016. 2019, 36:25, eff. May 15, 2019.