Financial Code — Part 9 | FIN — United States — California law | Esheria

Financial Code

Part 9 of 17 · provisions 1,601–1,800

This section says the act may be cited as the Financial Code.

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The commissioner must let certain debt collectors keep operating if they applied before January 1, 2023, and may issue a conditional license while an application is pending. Local governments in this state may not require a debt collector to be licensed or to register as a debt collector. This division is named the Debt Collection Licensing Act and may be cited by that name. A person may not do debt collection business in this state without first getting a license, and the license is tied to the principal place of business and cannot be transferred or assigned. This section defines key terms used in the Debt Collection Licensing Act.

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Provisions of Financial Code

Showing 200 of 3,273

  1. 21200.1.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    A loan setup fee may be charged for each loan, but it must be the greater of $7.50 or 3.5%, and it cannot exceed $90.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21200.1. A loan setup fee of seven dollars and fifty cents ($7.50) or 3.5 percent, whichever is greater, may be charged for each loan. However, the maximum loan setup fee shall not exceed ninety dollars ($90). Loan setup fees are in addition to any other allowed charges. (Amended by Stats. 2019, Ch. 189, Sec. 1. (AB 1186) Effective January 1, 2020.)
  2. 21200.10.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    A licensed pawnbroker must not promise a seller that sold property can later be bought back from the pawnbroker.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21200.10. No licensed pawnbroker shall promise any seller of tangible personal property that the seller may repurchase property sold to the pawnbroker. (Added by renumbering Section 21200.9 by Stats. 2024, Ch. 185, Sec. 2. (SB 1198) Effective January 1, 2025.)
  3. 21200.5.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    A pawnbroker may charge only the amounts listed in the loan-fee schedule, and must post that schedule where the public can clearly see it.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21200.5. A pawnbroker may charge as prescribed in the following schedule: Schedule of Charges (a) A charge not exceeding three dollars ($3) may be made on any loan for not more than three months which does not exceed nineteen dollars and ninety-nine cents ($19.99). (b) A charge not exceeding six dollars ($6) may be made on any loan for not more than three months of twenty dollars ($20) or more, but not exceeding forty-nine dollars and ninety-nine cents ($49.99). (c) A charge not exceeding nine dollars ($9) may be made on any loan for not more than three months of fifty dollars ($50) or more, but not exceeding seventy-four dollars and ninety-nine cents ($74.99). (d) A charge not exceeding twelve dollars ($12) may be made on any loan for not more than three months of seventy-five dollars ($75) or more, but not exceeding ninety-nine dollars and ninety-nine cents ($99.99). (e) A charge not exceeding fifteen dollars ($15) may be made on any loan for not more than three months of one hundred dollars ($100) or more, but not exceeding one hundred seventy-four dollars and ninety-nine cents ($174.99). (f) A charge not exceeding 9 percent may be made on any loan for not more than three months on any loan of one hundred seventy-five dollars ($175) or more, but not exceeding two thousand four hundred ninety-nine dollars and ninety-nine cents ($2,499.99). (g) The monthly charge for any extension of a written contract required by Section 21201 or 21201.5 shall be computed in accordance with the provisions of Section 21200. (h) The schedule of charges prescribed by this section shall be posted in a place clearly visible to the general public. (Amended by Stats. 2015, Ch. 245, Sec. 3. (SB 285) Effective January 1, 2016.)
  4. 21200.6.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    A pawnbroker may charge a handling, storage, and security fee when property is redeemed or a replacement loan is issued, subject to a size-based maximum schedule.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21200.6. (a) In addition to other allowed charges, at the time property is redeemed or a replacement loan is issued pursuant to Section 21201.5, the pawnbroker may collect a handling, storage, and security charge for pawned articles. The maximum amount that may be charged pursuant to this section is in accordance with the following schedule: (1) Five dollars ($5) or 2.5 percent of the loan amount for any article that can be contained within one cubic foot. (2) Ten dollars ($10) or 2.5 percent of the loan amount for any article that cannot be contained within one cubic foot, but can be contained within three cubic feet. (3) Twenty dollars ($20) or 2.5 percent of the loan amount for any article that cannot be contained within three cubic feet, but can be contained within six cubic feet. (4) Thirty dollars ($30) or 2.5 percent of the loan amount for any article that cannot be contained within six cubic feet and five dollars ($5) for each additional cubic foot in excess of six cubic feet. (b) For purposes of this section, cubic feet shall be determined by multiplying the width of an article, at its greatest width, by the depth of an article, at its greatest depth, by the height of an article, at its greatest height. (Amended by Stats. 2024, Ch. 185, Sec. 1. (SB 1198) Effective January 1, 2025.)
  5. 21200.7.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    A pawnbroker must post the maximum charge of compensation required under Section 21200 in a place that is clearly visible to the public.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21200.7. The maximum charge of compensation charged by a pawnbroker pursuant to the authority of Section 21200 shall be posted in a place clearly visible to the general public. (Added by renumbering Section 21200.5 by Stats. 1969, Ch. 25.)
  6. 21200.8.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    A pawnbroker may collect a $20 processing charge for each firearm pawned, in addition to other allowed charges.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21200.8. In addition to other allowed charges, a pawnbroker may collect a processing charge of twenty dollars ($20) for each firearm pawned. (Amended by Stats. 2019, Ch. 189, Sec. 3. (AB 1186) Effective January 1, 2020.)
  7. 21200.9.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    A pawnbroker may charge a remote transaction fee, but only when the pledgor asks for a replacement loan or redeems a loan electronically, and only up to 3.0% of the transaction amount.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21200.9. In addition to other allowed charges, a pawnbroker may collect a remote transaction fee, if the pledgor elects to request a replacement loan or to redeem a loan through electronic means, of up to 3.0 percent of the transaction amount to cover the recurring costs associated with software applications. (Added by Stats. 2024, Ch. 185, Sec. 3. (SB 1198) Effective January 1, 2025.)
  8. 21201.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    Pawnbrokers must use a written loan contract, give the pledgor a copy, keep pledged items during the loan period, give redemption notices, and cannot sell pledged property until title vests under this section.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21201. (a) Every loan made by a pawnbroker for which goods are received in pledge as security shall be evidenced by a written contract, a copy of which shall be furnished to the pledgor. The loan contract shall provide a loan period that is a minimum of four months, shall set forth the loan period and the date on which the loan is due and payable, and shall clearly inform the pledgor of their right to redeem the pledge during the loan period. (b) Every loan contract shall contain the following notice, in at least 8-point boldface type and circumscribed by a box, immediately above the space for the pledgor’s signature: “You may redeem the property you have pledged at any time until the close of business on ____ [fill in date no less than four months from date loan begins]. To redeem, you must pay the amount of the loan and the applicable charges which have accrued through the date on which you redeem.” (c) Every pawnbroker shall retain in their possession every article pledged to them for the duration of the loan period. During that period, the pledgor may redeem the articles upon payment of the amount of the loan and the applicable charges. If the pledgor and the pawnbroker agree in writing that the pawned property may be stored off premises, following the request for redemption of the loan, the pawnbroker shall return the pledged property to the pledgor the next calendar day when both the pawnbroker’s store and the storage facility are open, not to exceed two business days. (d) If any pledged article is not redeemed during the loan period as provided herein, and the pledgor and pawnbroker do not mutually agree in writing to extend the loan period, the pawnbroker shall notify the pledgor within one month after expiration of the loan period. If the pawnbroker fails to notify the pledgor within one month after the expiration of the loan period, the pawnbroker shall not charge interest from the day after the expiration of the one-month period. The pawnbroker shall notify the pledgor at the pledgor’s last known mailing or electronic address of the termination of the loan period, by a means for which verification of mailing or, at the sole option of the pledgor, electronic transmission of the notification can be provided by the pawnbroker, and extending the right of redemption, during posted business hours, for a period of 10 days from date of mailing or electronic transmission of that notice. Electronic notice of the termination of the loan period shall be valid if the pledgor has previously responded to an electronic communication sent by the pawnbroker to the pledgor’s last known electronic address provided by the pledgor. Upon the initiation of each new or replacement loan, the pledgor shall affirm that the current electronic address on file with the pawnbroker is valid. The 10-day notice shall state, in substantially the same format as the following: “If the tenth day falls on a day when the pawnshop is closed, the time period is extended to the next day that the pawnshop is open.” (e) The posted schedule of charges required pursuant to Section 21200.5 shall contain a notice informing the pledgor that if they desire, the pawnbroker shall send the notice of termination of the loan period by registered or certified mail with return receipt requested, upon prepayment of the mailing costs. (f) If any pledged article is not redeemed within the 10-day notice period, the pawnbroker shall become vested with all right, title, and interest of the pledgor, or the pledgor’s assigns, to the pledged article, to hold and dispose of as the pawnbroker’s own property. Any other provision of law relating to the foreclosure and sale of pledges shall not be applicable to any pledge the title to which is transferred in accordance with this section. The pawnbroker shall not sell any article of pledged property until they have become vested with the title to that property pursuant to this section. (g) The sale of pledged property is a misdemeanor pursuant to Section 21209. (Amended by Stats. 2019, Ch. 189, Sec. 4. (AB 1186) Effective January 1, 2020.)
  9. 21201.1.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    If a pledger or assignee loses a pawn ticket, a fee of up to $10 may be charged for certain verification and declaration services.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21201.1. Whenever a pledger, or his or her assignee, loses a pawn ticket, a fee of not to exceed ten dollars ($10) may be charged for services of verifying the identification of the claimant, fingerprinting the claimant, and having the claimant execute a declaration under penalty of perjury. (Added by Stats. 1991, Ch. 202, Sec. 3.)
  10. 21201.2.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    A pawnbroker may charge up to $7 for preparing and sending the required notice if the pledgor does not redeem a pawned item during the loan period.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21201.2. If the pledgor fails to redeem any pawned item during the loan period, thereby obliging the pawnbroker to mail or electronically transmit the notice required under Section 21201, the pawnbroker may charge a fee of up to seven dollars ($7) for services and costs pertaining to the preparation and mailing or electronic transmission of the notice, in addition to any other allowed charges. (Amended by Stats. 2024, Ch. 185, Sec. 4. (SB 1198) Effective January 1, 2025.)
  11. 21201.3.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    Pawnbrokers must include certain disclosures in the written contract, display an insurance sign at their premises, and post an off-premises storage sign when pledged property is stored away from the pawnshop.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21201.3. (a) The written contract required pursuant to Section 21201 shall contain a provision in 8-point type stating whether the item or items pledged are to be stored at the business premises of the pawnbroker and adjacent to this provision, the following disclosure shall be made: “We must return your property within two business days if your property is stored off premises.” (b) Every pawnbroker shall display a sign at his or her premises indicating whether or not pawned items are insured. (c) If a pawnbroker stores pledged property at a location other than the pawnshop, the pawnbroker shall post a conspicuous sign stating that pawned items may be stored off premises with the consent of the pledgor and that following the redemption of a loan, property is required to be returned the next calendar day upon which both the pawnbroker’s store and the storage facility are open, not to exceed two business days. (d) Notwithstanding Section 21209, a violation of this section is an infraction. (e) This section shall become operative July 1, 1995. (Amended by Stats. 2002, Ch. 404, Sec. 2. Effective January 1, 2003.)
  12. 21201.4.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    Loan charges for the first three months are set by the schedule in Section 21200.5, and later extension charges are set by the schedule in Section 21200.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21201.4. Charges for the first three months of any loan made pursuant to the written contract required by Section 21201 or 21201.5 shall be determined by the application of the schedule of charges contained in Section 21200.5. Charges for any extension of time following the first three months of any loan shall be determined by application of the schedule of maximum compensation contained in Section 21200. (Amended by Stats. 2011, Ch. 318, Sec. 5. (AB 424) Effective January 1, 2012.)
  13. 21201.5.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    This section lets a pledgor and pawnbroker arrange a replacement loan, but only within the stated time windows and subject to payment of prior charges and other conditions.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21201.5. (a) During the contractual loan period and any extension thereof, but prior to the start of the 10-day grace period provided in subdivision (d) of Section 21201, a pledgor may request, and a pawnbroker may consent to, a replacement loan to take effect upon the expiration of the loan period stated in the active loan contract delivered to the pledgor under Section 21201 or this section. (b) Alternatively, a pledgor may request, and a pawnbroker may consent to, a replacement loan during the 10-day grace period provided in subdivision (d) of Section 21201. Any such replacement loan shall become effective on the date it is issued. (c) All of the following shall apply to a replacement loan issued pursuant to this section: (1) The loan shall be processed as, and deemed to be, a new loan subject to all other fees and charges permitted by this chapter. (2) Before a replacement loan may be issued, the pledgor shall pay off all outstanding charges from the prior loan then due, including interest or any loan writing, storage, notification, or other fee authorized in this chapter, in cash or another form acceptable to the pawnbroker. The pledgor’s payment may be delivered to the pawnbroker by any method acceptable to the pawnbroker, including, but not limited to, United States mail, private mail, a personal representative, or electronic transfer. If insufficient payment is tendered by the pledgor or is not tendered in cash or a form acceptable to the pawnbroker, the pawnbroker shall, if commercially reasonable, return the payment in the same manner that the payment was delivered by the pledgor, or by another commercially reasonable manner, within five business days, and shall include a statement advising the pledgor the reason the payment was rejected. The pawnbroker is under no obligation to enter into a replacement loan if the amount is insufficient or the method of payment or form of tender is not cash or acceptable to the pawnbroker. (3) The unpaid balance of the prior loan shall be debited to the replacement loan on which the same article or articles have been pledged. The replacement loan contract shall disclose the amount of the prior loan that is debited and shall otherwise be consistent with Section 21201. (4) If the pledgor requests a replacement loan in person or electronically, the pledgor’s consent to the terms of the replacement loan shall be deemed given when he or she signs the written replacement loan contract in person or electronically in conformity with Section 21201.6. (5) If the pledgor requests a replacement loan by mail or through a personal representative, the pledgor’s consent to the terms of the replacement loan shall be deemed given when all required charges from the prior loan then due are paid in a form acceptable to the pawnbroker. The principal amount of a replacement loan requested by mail or through a personal representative shall not exceed the principal amount of the prior loan. (6) The terms of the replacement loan shall be consistent with this chapter on the date the replacement loan is issued. (7) The replacement loan shall be evidenced by a written agreement or electronic record. The pawnbroker shall mail or otherwise transmit a copy of the written agreement or electronic record to the pledgor within five business days following receipt of payment by means for which verification of mailing or electronic transmittal can be provided by the pawnbroker. (Amended by Stats. 2015, Ch. 417, Sec. 3. (SB 300) Effective January 1, 2016.)
  14. 21201.6.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    A pawnbroker may satisfy the written-contract-and-pledgor-signature requirement electronically if the stated conditions are met.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21201.6. The requirement for a written contract signed by the pledgor as set forth in Section 21201.5 may be met electronically if all of the following conditions are satisfied: (a) The contract and transaction comply with the provisions of the Uniform Electronic Transactions Act, as set forth in Title 2.5 (commencing with Section 1633.1) of Part 2 of Division 3 of the Civil Code, as may be applicable at the time that the loan is entered into between the pawnbroker and the pledgor. (b) Any written disclosures specified in this chapter to be set forth in a specified minimum type size are conspicuously presented to the pledgor prior to his or her execution of the electronic contract. (c) The pawnbroker makes one of the following disclosures: (1) If the principal loan amount is below two thousand five hundred dollars ($2,500), the pawnbroker discloses the maximum compensation due a pawnbroker as set forth in Section 21200.7 prior to the pledgor’s execution of the electronic contract. (2) If the principal loan amount is two thousand five hundred dollars ($2,500) or more, the pawnbroker discloses the provisions of Sections 21051 and 22054 prior to the pledgor’s execution of the electronic contract. (Added by Stats. 2015, Ch. 417, Sec. 4. (SB 300) Effective January 1, 2016.)
  15. 21202.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    Pawnbrokers must record key loan and pledge details at the time of each transaction and give the pledgor a written copy of the entry.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21202. Every pawnbroker shall enter at the time of the transaction, in records of loans and pledges kept by him for that purpose, the date, duration, amount, and rate of interest or charges of every loan made by him, a reasonably accurate description of the property pledged, the name and residence address of the pledgor. Every pawnbroker shall deliver to the pledgor a written copy of such entry. Such written copy need not include the name and address of the pledgor. (Amended by Stats. 1979, Ch. 1037.)
  16. 21203.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    A pawnbroker must return pledged property immediately when the loan is redeemed, unless the property is held under a Section 21647 hold or is stored off premises.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21203. Any property held in pawn which is not subject to a hold pursuant to Section 21647 of the Business and Professions Code shall be returned to the pledgor immediately upon redemption of the loan. However, if the property is stored off the business premises of the pawnbroker, following the redemption of the loan the property shall be returned the next calendar day when both the pawnbroker’s store and the storage facility are open, not to exceed two business days. (Amended by Stats. 2002, Ch. 404, Sec. 4. Effective January 1, 2003.)
  17. 21204.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    A pawnbroker must give the borrower a detailed receipt when a loan contract is redeemed.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21204. Every pawnbroker, upon redemption of a loan contract, shall provide the borrower with a receipt that correctly states in detail all of the fees, charges, and compensation paid by the borrower to the pawnbroker. (Added by Stats. 1998, Ch. 804, Sec. 2. Effective January 1, 1999.)
  18. 21205.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    Representatives of the pawnbroker industry must poll their members every year and gather data about the current financial condition of the California pawn industry.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21205. Representatives of the pawnbroker industry shall poll their members annually to gather data relating to the current financial condition of the California pawn industry. (Added by Stats. 2015, Ch. 245, Sec. 7. (SB 285) Effective January 1, 2016.)
  19. 21206.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    Pawnbrokers must produce loan records and all pledged property for inspection by certain authorized persons.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21206. Every pawnbroker shall produce his or her records of loans and all pledged property, for inspection by the following persons: (a) Any officer holding a warrant authorizing him or her to search for personal property. (b) Any peace officer or employee designated by the chief of police or sheriff. (c) Any officer holding a court order directing him or her to examine such records or pledged property. (Amended by Stats. 1992, Ch. 647, Sec. 8. Effective January 1, 1993.)
  20. 21206.7.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

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    When a peace officer takes property from a pawnbroker on the basis that it is stolen, the police officer must give the pawnbroker a receipt.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21206.7. Whenever any property is taken from a pawnbroker by a peace officer which is alleged to be stolen property, the police officer shall give the pawnbroker a receipt for the property which shall contain a description of the property, the reason for seizure, and the names of the pawnbroker and the officer. (Added by Stats. 1979, Ch. 1037.)
  21. 21206.8.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    This section sets procedures for claims and notice when property taken from a pawnbroker is alleged to be lost, stolen, or embezzled.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21206.8. (a) Notwithstanding the provisions of Chapter 12 (commencing with Section 1407) of Title 10 of Part 2 of the Penal Code, whenever property alleged to have been lost, stolen, or embezzled is taken from a pawnbroker, the peace officer, magistrate, court, clerk, or other person having custody of the property shall not deliver the property to any person claiming ownership unless the provisions of this section are complied with. (b) (1) If any person makes a claim of ownership, the person shall file a written statement, signed under penalty of perjury, stating the factual basis upon which they claim ownership or an interest in the property with the person having custody of the property, and the person having custody of the property shall notify the pawnbroker of the claim by providing a true and correct copy of the claim to the pawnbroker. (2) If the pawnbroker makes no claim with respect to the property within 10 days of such notification, the property may be disposed of as otherwise provided by law. (3) In adjudicating the competing claims of a pawnbroker and a person claiming ownership or an interest in the property seized from a pawnbroker, the adjudicating court shall give due consideration to the effect Section 2403 of the Commercial Code may have on the claims. (4) At least 30 calendar days before any hearing adjudicating any competing claims of a pawnbroker and a person claiming ownership or an interest in the property, the person having custody of the property shall deliver to the pawnbroker a true and correct copy of the police report, redacted as may be required by law and consistent with due process of law, substantiating the basis of the seizure of the property from the pawnbroker. (c) If property alleged to have been stolen or embezzled is taken from a pawnbroker, prior to any disposal of the property pursuant to Section 1411 of the Penal Code, the notice to be given to the owner and owner of a security interest pursuant to Section 1411 shall be given to the pawnbroker. Such property shall not be disposed of pursuant to Section 1411 until three months after such notice has been given. (d) A pawnbroker shall not be liable to any person for any property seized from the pawnbroker on account of the pawnbroker’s inability to return the property to that person because of the seizure. (Amended by Stats. 2013, Ch. 318, Sec. 2. (SB 762) Effective January 1, 2014.)
  22. 21207.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    A pawnbroker must not receive anything in pledge from a minor.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21207. No pawnbroker shall receive anything in pledge from any person who is a minor. (Amended by Stats. 1989, Ch. 1418, Sec. 4.)
  23. 21208.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    A pawnbroker must follow the reporting requirements that apply to secondhand dealers under the referenced Business and Professions Code article.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21208. A pawnbroker shall comply with the reporting requirements imposed on secondhand dealers under Article 4 (commencing with Section 21625) of Chapter 9 of Division 8 of the Business and Professions Code. (Repealed and added by Stats. 2012, Ch. 172, Sec. 8. (AB 391) Effective August 17, 2012.)
  24. 21209.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    Violating any provision of this chapter while knowing, or having reason to know, that a violation is occurring is a misdemeanor.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 2. Pawnbroker Regulations [21200 - 21209] ( Chapter 2 enacted by Stats. 1951, Ch. 364. ) ## 21209. The violation of any provision of this chapter under circumstances where a person knows or should have known that a violation was being committed is a misdemeanor. (Amended by Stats. 1986, Ch. 826, Sec. 7.)
  25. 2121.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 7. Examinations, Special Reports, and Records [2120 - 2127] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    The commissioner may work with other state or federal money transmission regulators to enforce and administer this division.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 7. Examinations, Special Reports, and Records [2120 - 2127] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2121. The commissioner may consult and cooperate with other state or federal money transmission regulators in enforcing and administering this division. They may jointly pursue examinations and take other official action that they are otherwise empowered to take. (Amended by Stats. 2012, Ch. 356, Sec. 23. (SB 979) Effective January 1, 2013.)
  26. 2122.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 7. Examinations, Special Reports, and Records [2120 - 2127] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    A licensee must file a report with the commissioner within five business days after learning of certain events.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 7. Examinations, Special Reports, and Records [2120 - 2127] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2122. A licensee shall file a report with the commissioner within five business days after the licensee has reason to know of the occurrence any of the following events: (a) The filing of a petition by or against the licensee under the United States Bankruptcy Code (11 U.S.C. Secs. 101-110, incl.) for bankruptcy or reorganization. (b) The filing of a petition by or against the licensee for receivership, the commencement of any other judicial or administrative proceeding for its dissolution or reorganization, or the making of a general assignment for the benefit of its creditors. (c) The commencement of a proceeding to revoke or suspend its license in a state or country in which the licensee engages in business or is licensed. (d) The cancellation or other impairment of the licensee’s bond or other security. (e) A charge or conviction of the licensee or of an executive officer, manager, director, or person in control of the licensee for a felony. (f) A charge or conviction of an agent for a felony. (Added by Stats. 2011, Ch. 243, Sec. 4. (SB 664) Effective January 1, 2012.)
  27. 2123.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 7. Examinations, Special Reports, and Records [2120 - 2127] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    A covered licensee and its money-services-business agents must comply with the relevant Bank Secrecy Act regulations.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 7. Examinations, Special Reports, and Records [2120 - 2127] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2123. A licensee that is a money services business under the regulations adopted pursuant to the United States Bank Secrecy Act (31 C.F.R. Chapter X) and the agents of the licensee that are money services businesses shall comply with those regulations. (Amended by Stats. 2022, Ch. 452, Sec. 104. (SB 1498) Effective January 1, 2023.)
  28. 2124.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 7. Examinations, Special Reports, and Records [2120 - 2127] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    Licensees must keep specified records, including compliance records, for set periods and provide English translations of certain records on notice.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 7. Examinations, Special Reports, and Records [2120 - 2127] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2124. (a) A licensee shall maintain the following records for determining its compliance with this division for at least three years: (1) A record of each payment instrument or stored value obligation sold. (2) A general ledger posted at least monthly containing all asset, liability, capital, income, and expense accounts. (3) Bank statements and bank reconciliation records. (4) Records of outstanding payment instruments and stored value obligations. (5) Records of each payment instrument and stored-value obligation paid within the three-year period. (6) A list of the last known names and addresses of all of the licensee’s agents and their branch offices. (7) Any other records the commissioner reasonably requires by order or regulation. (b) A licensee or its agent shall maintain records of any receipts provided pursuant to Section 2102 for six months or a longer period of time specified in the contract between the licensee and its agent. (c) The items specified in subdivisions (a) and (b) may be maintained in any form of record. (d) Records may be maintained outside this state if they are made available to the commissioner on seven days’ notice that is sent in a record. (e) If records not required to be maintained in English pursuant to Section 456 are in a language other than English, the licensee shall provide records translated into English within seven days’ notice that is sent in a record. (f) Each licensee shall maintain any other records required by the commissioner. (Amended by Stats. 2014, Ch. 499, Sec. 15. (AB 2209) Effective January 1, 2015.)
  29. 2125.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 7. Examinations, Special Reports, and Records [2120 - 2127] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    A licensee must notify the commissioner when adding or replacing a key individual and submit required information on time.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 7. Examinations, Special Reports, and Records [2120 - 2127] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2125. A licensee adding or replacing a key individual shall do all of the following: (a) Provide notice to the commissioner within 15 days after the effective date of the key individual’s appointment. (1) Within 90 days of compliance with this subdivision, the commissioner may issue a notice of disapproval of a key individual if the competence, experience, character, or integrity of the individual supports a determination by the commissioner that it is not in the best interests of the public or the licensee’s customers to permit the individual to be a key individual of the licensee. (2) If the notice provided pursuant to this subdivision is not disapproved within 90 days after the date on which the notice was provided, the key individual shall be deemed approved. This timeframe does not apply to applications filed pursuant to Section 2035. (b) Provide information, as applicable, required by Sections 80.4105 and 80.4105.10 of Title 10 of the California Code of Regulations, as amended from time to time, within 45 days of the effective date. (Added by Stats. 2023, Ch. 463, Sec. 10. (AB 1116) Effective January 1, 2024.)
  30. 2127.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 7. Examinations, Special Reports, and Records [2120 - 2127] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    Until January 1, 2025, licensed money transmitters are exempt from this section to the extent it conflicts with December 31, 2023 law or adds new requirements.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 7. Examinations, Special Reports, and Records [2120 - 2127] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2127. Before January 1, 2025, a person licensed under this division to engage in the business of money transmission shall not be subject to a provision of the act adding this section to the extent that the provision conflicts with the law in effect on December 31, 2023, or to the extent the provision establishes new requirements not imposed under the law in effect on December 31, 2023. (Added by Stats. 2023, Ch. 463, Sec. 11. (AB 1116) Effective January 1, 2024.)
  31. 213.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 1. Definitions [99 - 217] ( Chapter 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    This section defines “Uniform Rating System for Informational Technology (URSIT)” by reference to a federal policy statement.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 1. Definitions [99 - 217] ( Chapter 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 213. “Uniform Rating System for Informational Technology (URSIT)” shall have the meaning set forth in the policy statement regarding the uniform rating system for information technology published by the Federal Financial Institutions Examination Council on January 20, 1999, and implemented on or before April 1, 1999 (64 Fed. Reg. 3109). (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  32. 21300.1.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. )

    Verify source ↗

    A person who is not duly licensed under this section must not act as a pawnbroker or hold out as a pawnbroker or pawnbrokerage business entity.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. ) ## 21300.1. It is unlawful for any person who is not duly licensed under this section to act as a pawnbroker or represent himself, herself, or a business entity to be a pawnbroker or a pawnbrokerage business entity. (Added by Stats. 1996, Ch. 923, Sec. 8. Effective January 1, 1997.)
  33. 21301.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. )

    Verify source ↗

    Pawnbroker licenses must be renewed on the second year after issue and every two years after that, with an application, fee, and compliance with Section 21303. The license is also subject to location, display, and conduct conditions, and can face forfeiture or injunction for breach.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. ) ## 21301. (a) A license granted pursuant to Section 21300 shall be renewable the second year from the date of issue, and every other year thereafter, upon the filing of a renewal application, payment of a renewal fee specified by the licensing authority as described in this subdivision, and compliance with the requirements of Section 21303. The Department of Justice shall also require the licensee, in addition to any locally assessed fee as set forth herein, to pay a fee as described in Section 21642.5 of the Business and Professions Code. The licensing authority shall collect the fee and transmit the fee and a copy of the renewed license to the Department of Justice. The police chief, sheriff, or, where appropriate, the police commission may charge a fee not to exceed the actual costs incurred to process the renewal application of the licensee and to collect and transmit the fee charged by the Department of Justice. (b) The license shall be subject to forfeiture by the licensing authority, and the licensee’s activities as a pawnbroker shall be subject to being enjoined pursuant to Section 21302, for breach of any of the following conditions: (1) The business shall be carried on only at the location designated on the license. The license shall designate all locations where property belonging to the business is stored. Property of the business may be stored at locations not designated on the license only with the written consent of the local licensing authority. (2) The license or a copy thereof, certified by the licensing authority, shall be displayed on the premises in plain view of the public. (3) The licensee shall not engage in any act that the licensee knows to be in violation of this article. (4) The licensee shall not be convicted of an attempt to receive stolen property or other offense involving stolen property. For the purposes of this paragraph, “convicted” means a plea or verdict of guilty or a conviction following a plea of nolo contendere. Any action that the chief of police, the sheriff, or, where appropriate, the police commission is permitted to take following that conviction may be taken when the time for appeal has elapsed, the judgment of conviction has been affirmed on appeal, or an order granting probation is made suspending the imposition of sentence, irrespective of a subsequent order under Section 1203.4 of the Penal Code. (c) Notwithstanding subdivisions (a) and (b), no renewal application for a pawnbroker’s license may be denied, nor may his or her pawnbroker’s license be forfeited, solely on the grounds that the applicant violated any provision contained in Chapter 1 (commencing with Section 21000) or Chapter 2 (commencing with Section 21200), or any provision contained in Article 4 (commencing with Section 21625) or Article 5 (commencing with Section 21650) of Chapter 9 of Division 8 of the Business and Professions Code, unless the violation demonstrates a pattern of conduct. (Amended by Stats. 2012, Ch. 172, Sec. 10. (AB 391) Effective August 17, 2012.)
  34. 21301.1.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. )

    Verify source ↗

    A person may not advertise as a pawnbroker, or use ad wording implying a pawn transaction, unless the pawnbroker’s license number is clearly shown in the advertisement.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. ) ## 21301.1. It is unlawful for any person to advertise his or her services as a pawnbroker, or to use any words or parts of words in any advertisements that connote a transaction involving the taking of tangible personal property as security for a loan unless the pawnbroker’s license number is clearly displayed in the advertisement. (Added by Stats. 1996, Ch. 923, Sec. 10. Effective January 1, 1997.)
  35. 21302.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. )

    Verify source ↗

    The district attorney or Attorney General may sue to stop violations or threatened violations of certain pawnbroker-related regulations.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. ) ## 21302. The district attorney or the Attorney General, in the name of the people of the State of California, may bring an action to enjoin the violation or the threatened violation of any regulation made pertaining to the provisions contained in Chapter 1 (commencing with Section 21000) or Chapter 2 (commencing with Section 21200) of this division or Article 4 (commencing with Section 21625) or Article 5 (commencing with Section 21650) of Chapter 9 of Division 8 of the Business and Professions Code. Any proceeding brought hereunder shall be governed in all respects by the provisions of Chapter 3 (commencing with Section 525) of Title 7 of Part 2 of the Code of Civil Procedure. (Added by Stats. 1993, Ch. 782, Sec. 4. Effective January 1, 1994.)
  36. 21303.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. )

    Verify source ↗

    To get or renew a pawnbroker’s license, the applicant must file a two-year nonrevokable surety bond for $20,000 with the licensing/issuing authority.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. ) ## 21303. (a) As a condition precedent to the issuance or renewal of a pawnbroker’s license the applicant shall file a pawnbroker’s two-year nonrevokable surety bond with the issuing authority, in the sum of twenty thousand dollars ($20,000). The pawnbroker’s bond required by this article shall be executed by an admitted surety in favor of the State of California and shall be filed by the applicant with the licensing authority. (b) The bond shall be for the benefit of pledgors of pledged property when the property is not available for redemption, due to the criminal negligence, criminal malfeasance, or other criminal conduct of the pawnbroker, and the pledgor has complied with the conditions precedent to redemption under the terms of the loan contract. The pledgor has the burden of establishing by clear and convincing evidence that all conditions precedent to redemption under the terms of the loan contract have been performed. (Added by Stats. 1993, Ch. 782, Sec. 4. Effective January 1, 1994.)
  37. 21303.5.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. )

    Verify source ↗

    Starting January 1, 2026, a new or renewing pawnbroker license applicant must complete eight hours of approved education and give the licensing agency a council-issued completion certificate.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. ) ## 21303.5. (a) On and after January 1, 2026, as a condition precedent to issuing a new pawnbroker’s license, the applicant shall complete at least eight hours of prelicensing education approved by the California Pawnbroker Education Council pursuant to Chapter 4 (commencing with Section 21400) and submit to the licensing agency a certificate of completion issued by the council pursuant to Section 21409. (b) On and after January 1, 2026, as a condition precedent to renewing a pawnbroker’s license, the applicant shall complete at least eight hours of continuing education approved by the California Pawnbrokers Education Council pursuant to Chapter 4 (commencing with Section 21400) and submit to the licensing agency a certificate of completion issued by the council pursuant to Section 21409. (c) This section shall remain in effect only until January 1, 2029, and as of that date is repealed. (Added by Stats. 2024, Ch. 223, Sec. 2. (AB 2231) Effective January 1, 2025. Repealed as of January 1, 2029, by its own provisions.)
  38. 21304.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. )

    Verify source ↗

    An applicant for a pawnbroker’s license must file a financial statement showing at least $100,000 in liquid assets, or use an allowed substitute, and the statement must be under penalty of perjury and signed by a California certified public accountant.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. ) ## 21304. (a) As a condition precedent to the issuing of a pawnbroker’s license, the applicant shall file with the issuing authority a financial statement confirming that the applicant has at least one hundred thousand dollars ($100,000) in the form of liquid assets readily available for use in each licensed business for which the application is made, not including real property, or, in the absence of one hundred thousand dollars ($100,000), an applicant may post a nonrevocable surety bond in the amount of one hundred thousand dollars ($100,000) or the applicant may, in lieu of posting a surety bond, deposit money, certificates, accounts, bonds, or notes, as provided in Section 995.710 of the Code of Civil Procedure. The financial statement shall be filed by the applicant under penalty of perjury and signed by a California certified public accountant verifying that he or she has reviewed the financial statement. (b) This section does not apply to any person holding a secondhand dealer’s license pursuant to Section 21641 or 21642 of the Business and Professions Code who is actively engaged as a pawnbroker on the effective date of this section. (Amended by Stats. 1997, Ch. 17, Sec. 40. Effective January 1, 1998.)
  39. 21305.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. )

    Verify source ↗

    A license issued under this chapter cannot be transferred or assigned.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. ) ## 21305. A license issued pursuant to this chapter shall not be transferred or assigned. (Added by Stats. 1993, Ch. 782, Sec. 4. Effective January 1, 1994.)
  40. 21306.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. )

    Verify source ↗

    A pawnbroker licensed under Section 21300 is exempt from certain secondhand dealer licensing requirements and may do covered transactions in tangible personal property.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. ) ## 21306. A pawnbroker licensed under Section 21300 is exempt from the licensing requirements under Sections 21641 and 21642 of the Business and Professions Code and may engage in any transaction involving tangible personal property for which a secondhand dealers license is required under Sections 21641 and 21642 of the Business and Professions Code. Pawnbrokers operating under this license exemption are required to conform to all other requirements of secondhand dealers for which a license is required under Sections 21641 and 21642 of the Business and Professions Code. (Added by Stats. 1993, Ch. 782, Sec. 4. Effective January 1, 1994.)
  41. 21307.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. )

    Verify source ↗

    Violating any provision of this chapter, when the person knew or should have known about the violation, is a misdemeanor unless another specific rule says otherwise.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 3. Licensure [21300 - 21307] ( Chapter 3 added by Stats. 1993, Ch. 782, Sec. 4. ) ## 21307. Except as otherwise specifically provided, the violation of any provision of this chapter under circumstances where a person knows or should have known that a violation was being committed is a misdemeanor. (Added by Stats. 1996, Ch. 923, Sec. 12. Effective January 1, 1997.)
  42. 21400.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 4. Pawnbroker Education Act [21400 - 21413] ( Chapter 4 added by Stats. 2024, Ch. 223, Sec. 3. )

    Verify source ↗

    This section names the chapter the Pawnbroker Education Act and says it may be cited that way.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 4. Pawnbroker Education Act [21400 - 21413] ( Chapter 4 added by Stats. 2024, Ch. 223, Sec. 3. ) ## 21400. This chapter shall be known, and may be cited, as the Pawnbroker Education Act. (Added by Stats. 2024, Ch. 223, Sec. 3. (AB 2231) Effective January 1, 2025. Repealed as of January 1, 2029, pursuant to Section 21413.)
  43. 21401.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 4. Pawnbroker Education Act [21400 - 21413] ( Chapter 4 added by Stats. 2024, Ch. 223, Sec. 3. )

    Verify source ↗

    This section states that pawnbroker businesses provide short-term credit, describes how pawnbroker loans are used, and says education for licensed pawnbrokers is intended to support compliance and conduct standards.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 4. Pawnbroker Education Act [21400 - 21413] ( Chapter 4 added by Stats. 2024, Ch. 223, Sec. 3. ) ## 21401. The Legislature finds and declares all of the following: (a) Pawnbroker businesses provide a valuable source of short-term credit for economically vulnerable consumers and the state’s unbanked population, as everyone who seeks a pawn loan can borrow money regardless of creditworthiness. (b) Individuals who use pawnbroker loans in this state use those loans for, among other things, paying for the necessities of life. (c) The Legislature recognizes that education for licensed pawnbrokers, as defined in this chapter, will ensure the highest standards of conduct and compliance with state and federal laws applicable to pawnbroker businesses. (d) In order to continuously improve the competence of licensed pawnbrokers, the Legislature encourages all licensees to regularly engage in continuing education related to the profession, as defined in this chapter. (Added by Stats. 2024, Ch. 223, Sec. 3. (AB 2231) Effective January 1, 2025. Repealed as of January 1, 2029, pursuant to Section 21413.)
  44. 21403.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 4. Pawnbroker Education Act [21400 - 21413] ( Chapter 4 added by Stats. 2024, Ch. 223, Sec. 3. )

    Verify source ↗

    This section creates the California Pawnbroker Education Council, sets up its board, gives the council authority to take reasonable implementation actions, and requires the council to set fees to fund its work.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 4. Pawnbroker Education Act [21400 - 21413] ( Chapter 4 added by Stats. 2024, Ch. 223, Sec. 3. ) ## 21403. (a) The California Pawnbroker Education Council is hereby established to carry out the responsibilities and duties described in this chapter. (b) The council shall be governed by a board of directors composed of, but not limited to, members who shall be chosen in the following manner: (1) One member shall be a representative of the California Police Chiefs Association or California State Sheriffs’ Association, unless those entities choose not to appoint a member to the council. (2) One member shall be appointed by the Secondhand Dealer and Pawnbroker Unit of the Department of Justice, unless the department chooses not to appoint a member to the council. (3) Four members shall be licensed pawnbrokers who are California residents selected by a professional society, association, or other entity, the membership of which is composed of licensed pawnbrokers. The professional society, association, or other entity shall have a dues-paying membership in California of at least 200 individuals, have been established in or before 2000, and have bylaws that require its members to comply with a code of ethics. (4) One member shall be a licensed attorney who is a California resident selected by a professional society, association, or other entity described in paragraph (3). (c) Each member of the board of directors shall serve a term of two years. (d) The council may take any reasonable actions necessary to carry out the responsibilities and duties set forth in this chapter, including, but not limited to, hiring staff, entering into contracts, and developing policies, procedures, rules, and bylaws to implement this chapter. (e) The council shall establish fees sufficient to support the functions of the council and to cover the reasonable costs of administering this chapter. (Added by Stats. 2024, Ch. 223, Sec. 3. (AB 2231) Effective January 1, 2025. Repealed as of January 1, 2029, pursuant to Section 21413.)
  45. 21405.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 4. Pawnbroker Education Act [21400 - 21413] ( Chapter 4 added by Stats. 2024, Ch. 223, Sec. 3. )

    Verify source ↗

    The council must create a pawnbroker training curriculum by January 1, 2026, and it must include at least 8 hours of prelicensing education and 8 hours of continuing education.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 4. Pawnbroker Education Act [21400 - 21413] ( Chapter 4 added by Stats. 2024, Ch. 223, Sec. 3. ) ## 21405. (a) The council shall, on or before January 1, 2026, develop and establish a standard course and curriculum in pawnbroker transactions that shall include at least eight hours of prelicensing education to be taken by an applicant for licensure, and eight hours of continuing education to be taken by a licensee or their designated representative. (b) The curriculum established by the council shall meet minimum standards for education in the following areas: (1) Compliance with federal laws applicable to the pawnbroker business, including, but not limited to, bankruptcy, search and seizure, anti-money laundering, and lending laws. (2) Compliance with state laws applicable to the pawnbroker business (Division 8 (commencing with Section 21000)) and the reporting requirements imposed upon secondhand dealers pursuant to Article 4 (commencing with Section 21625) of Chapter 9 of Division 8 of the Business and Professions Code. (c) The curriculum may include any other training that the council deems to be relevant to the efficient and lawful operation of a pawnbroker business. (Added by Stats. 2024, Ch. 223, Sec. 3. (AB 2231) Effective January 1, 2025. Repealed as of January 1, 2029, pursuant to Section 21413.)
  46. 21407.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 4. Pawnbroker Education Act [21400 - 21413] ( Chapter 4 added by Stats. 2024, Ch. 223, Sec. 3. )

    Verify source ↗

    Anyone proposing to offer qualifying educational courses must apply for and obtain council approval. The council also has authority to create the rules and procedures for approvals, denials, corrections, and withdrawals.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 4. Pawnbroker Education Act [21400 - 21413] ( Chapter 4 added by Stats. 2024, Ch. 223, Sec. 3. ) ## 21407. (a) Individuals, entities, agencies, and associations that propose to offer educational courses that satisfy the prelicensing or continuing education requirements of this chapter shall apply for and obtain the approval of the council. (b) The council shall develop policies, procedures, rules, or bylaws governing the requirements described in this chapter and the process for applying to become, approving, denying the approval of, imposing correction action upon, or withdrawing the approval of, an educational course provider. These policies, procedures, rules, or bylaws shall address topics including, but not limited to, what constitutes an acceptable curriculum and facility requirements. (Added by Stats. 2024, Ch. 223, Sec. 3. (AB 2231) Effective January 1, 2025. Repealed as of January 1, 2029, pursuant to Section 21413.)
  47. 21409.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 4. Pawnbroker Education Act [21400 - 21413] ( Chapter 4 added by Stats. 2024, Ch. 223, Sec. 3. )

    Verify source ↗

    The council must start issuing education certificates on January 1, 2026 to eligible pawnbroker license applicants and renewal licensees, and must keep records of education completion for at least two years.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 4. Pawnbroker Education Act [21400 - 21413] ( Chapter 4 added by Stats. 2024, Ch. 223, Sec. 3. ) ## 21409. (a) Beginning on January 1, 2026, the council shall issue a certificate to an applicant for a pawnbroker license, or a licensee applying for renewal of a pawnbroker license, who has satisfied the educational requirements of this chapter. (b) The council shall maintain records verifying completion of the initial prelicensing education and continuing education for a period of not less than two years. (Added by Stats. 2024, Ch. 223, Sec. 3. (AB 2231) Effective January 1, 2025. Repealed as of January 1, 2029, pursuant to Section 21413.)
  48. 21411.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 4. Pawnbroker Education Act [21400 - 21413] ( Chapter 4 added by Stats. 2024, Ch. 223, Sec. 3. )

    Verify source ↗

    This section says the council cannot approve, deny, revoke, or suspend a license issued under Section 21300.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 4. Pawnbroker Education Act [21400 - 21413] ( Chapter 4 added by Stats. 2024, Ch. 223, Sec. 3. ) ## 21411. Nothing in this chapter authorizes the council to approve, deny, revoke, or suspend a license issued pursuant to Section 21300. (Added by Stats. 2024, Ch. 223, Sec. 3. (AB 2231) Effective January 1, 2025. Repealed as of January 1, 2029, pursuant to Section 21413.)
  49. 21413.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 4. Pawnbroker Education Act [21400 - 21413] ( Chapter 4 added by Stats. 2024, Ch. 223, Sec. 3. )

    Verify source ↗

    Chapter 4 stays in force only until January 1, 2029, when it is repealed.

    ## Financial Code - FIN ## DIVISION 8. PAWNBROKERS [21000 - 21413] ( Division 8 enacted by Stats. 1951, Ch. 364. ) ## CHAPTER 4. Pawnbroker Education Act [21400 - 21413] ( Chapter 4 added by Stats. 2024, Ch. 223, Sec. 3. ) ## 21413. This chapter shall remain in effect only until January 1, 2029, and as of that date is repealed. (Added by Stats. 2024, Ch. 223, Sec. 3. (AB 2231) Effective January 1, 2025. Repealed as of January 1, 2029, by its own provisions. Note: Repeal affects Chapter 4, commencing with Section 21400.)
  50. 2148.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    The commissioner may order a licensee to comply with the law or stop unsafe or injurious business practices, and the licensee must comply with any final order unless enforcement is restrained within 10 days.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2148. (a) If it appears to the commissioner that a licensee is violating or has violated, or is failing or has failed to comply with any law of this state, the commissioner may direct the licensee to comply with the law by an order issued under the commissioner’s official seal, or if it appears to the commissioner that any licensee is conducting or has conducted its business in an unsafe or injurious manner, the commissioner may in like manner direct it to discontinue the unsafe or injurious practices. The order shall require the licensee to show cause before the commissioner, at a time and place to be fixed by the commissioner, as to why the order should not be observed. (b) If, upon any hearing held pursuant to subdivision (a), the commissioner finds that the licensee is violating or has violated, or is failing or has failed to comply with any law of this state or is conducting or has conducted its business in an unsafe or injurious manner, the commissioner may make a final order directing it to comply with the law or to discontinue the unsafe or injurious practices. A licensee shall comply with the final order unless, within 10 days after the issuance of the order, its enforcement is restrained in a proceeding brought by the licensee. (Amended by Stats. 2022, Ch. 188, Sec. 7. (AB 2433) Effective January 1, 2023.)
  51. 2149.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    The commissioner may suspend or revoke a license, or place a licensee in receivership, after notice and a hearing if listed grounds are found.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2149. (a) The commissioner may issue an order suspending or revoking a license, or taking possession of and placing a licensee in receivership, if after notice and an opportunity for hearing, the commissioner finds that: (1) The licensee is violating this division or a regulation adopted or an order issued under this division, or a condition of approval issued under this division. (2) The licensee does not cooperate with an examination or investigation by the commissioner. (3) The licensee engages in fraud, intentional misrepresentation, or gross negligence. (4) The competence, experience, character, or general fitness of the licensee, or any director, officer, employee, or person in control of a licensee, indicates that it is not in the public interest to permit the person to provide money transmission services. (5) The licensee engages in an unsafe or unsound practice. (6) The licensee is insolvent, suspends payment of its obligations, or makes a general assignment for the benefit of its creditors. (7) The licensee does not remove an agent after the commissioner issues and serves upon the licensee a final order including a finding that the agent has violated this division. (8) The licensee has applied for an adjudication of bankruptcy, reorganization, arrangement, or other relief under any bankruptcy, reorganization, insolvency, or moratorium law, or any person has applied for any such relief under that law against the licensee and the licensee has by any affirmative act approved of or consented to the action or the relief has been granted. (9) Any fact or condition exists that, if it had existed at the time when the licensee applied for its license, would have been grounds for denying the application. (b) In determining whether a licensee is engaging in an unsafe or unsound practice, the commissioner may consider the size and condition of the licensee’s provision of money transmission services, the magnitude of the loss, the gravity of the violation of this division, and the previous conduct of the person involved. (Amended by Stats. 2012, Ch. 356, Sec. 25. (SB 979) Effective January 1, 2013.)
  52. 215.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 1. Definitions [99 - 217] ( Chapter 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    This section defines “Vote” by referring to Section 194 of the Corporations Code.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 1. Definitions [99 - 217] ( Chapter 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 215. “Vote” has the meaning set forth in Section 194 of the Corporations Code. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  53. 2150.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    The commissioner may suspend or revoke an agent’s designation after notice and a hearing if listed grounds are found; licensees cannot appoint, and affected persons cannot serve, as agents while such an order is in effect.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2150. (a) The commissioner may issue an order suspending or revoking the designation of an agent if, after notice and an opportunity for hearing, the commissioner finds that: (1) The agent violated this division or a regulation adopted or an order issued under this division. (2) The agent did not cooperate with an examination or investigation by the commissioner. (3) The agent engaged in fraud, intentional misrepresentation, or gross negligence. (4) The agent is convicted of a violation of a state or federal anti-money laundering statute. (5) The competence, experience, character, or general fitness of the agent, or any director, officer, employee, or person in control of the agent, indicates that it is not in the public interest to permit the agent to provide money transmissions. (6) The agent is engaging in an unsafe or unsound practice. (7) The agent has made or caused to be made in any application or report filed with the commissioner or in any proceeding before the commissioner, any statement that was at the time and in the light of the circumstances under which it was made, false or misleading with respect to any material fact, or has omitted to state in any of those applications, reports, or proceedings any material fact which is required to be stated therein. (8) The agent is an agent of a licensee who, because of its operations and financial condition, is not competent to supervise and monitor the agent. (9) The agent will not comply with all applicable provisions of this division and of any regulation or order issued under this division. (b) In determining whether an agent is engaging in an unsafe or unsound practice, the commissioner may consider the size and condition of the agent’s provision of money transmission services, the magnitude of the loss, the gravity of the violation of this division or a rule adopted or order issued under this division, and the previous conduct of the agent. (c) No licensee shall appoint as an agent any person with respect to whom an order issued under this section is in effect. (d) No person with respect to whom an order issued under this section is in effect shall become or continue to be an agent of any licensee. (e) If applicable, the commissioner may disclose to the licensee criminal history information upon which an order is based. (Amended by Stats. 2012, Ch. 356, Sec. 26. (SB 979) Effective January 1, 2013.)
  54. 2150.1.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    The commissioner’s orders and other official acts are reviewable in accordance with law. If the commissioner takes possession of a licensee’s property and business, the licensee may seek court relief within 10 days.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2150.1. (a) Every order, decision, or other official act of the commissioner is subject to review in accordance with law. (b) Whenever the commissioner has taken possession of the property and business of any licensee, the licensee, within 10 days after that taking, if it deems itself aggrieved thereby, may apply to the superior court in the county in which the head office of the licensee is located to enjoin further proceedings. The court, after citing the commissioner to show cause why further proceedings should not be enjoined and after a hearing and a determination of the facts upon the merits, may dismiss the application or enjoin the commissioner from further proceedings and direct the commissioner to surrender the property and business to the licensee. (Added by Stats. 2011, Ch. 243, Sec. 4. (SB 664) Effective January 1, 2012.)
  55. 2150.2.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    The commissioner may immediately suspend or revoke a license in certain cases. The licensee may request a hearing within 30 days, and the commissioner must act on the hearing within 30 days after it is held.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2150.2. (a) If the commissioner finds that any of the factors set forth in Section 2149 is true with respect to any licensee and that it is necessary for the protection of the public interest, the commissioner may issue an order immediately suspending or revoking the licensee’s license. (b) Within 30 days after the license is suspended or revoked pursuant to subdivision (a), the licensee may file with the commissioner an application for a hearing on the suspension or revocation. (c) If the commissioner fails to commence a hearing within 15 business days after the application is filed with the commissioner pursuant to subdivision (b) or within a longer period of time agreed to by the licensee, the suspension or revocation shall be deemed rescinded. (d) Within 30 days after the hearing, the commissioner shall affirm, modify, or rescind the suspension or revocation. Otherwise, the suspension or revocation shall be deemed rescinded. (e) The right of the licensee to petition for judicial review of the suspension or revocation shall not be affected by the failure of the licensee to apply to the commissioner for a hearing on the suspension or revocation pursuant to subdivision (b). (Added by Stats. 2011, Ch. 243, Sec. 4. (SB 664) Effective January 1, 2012.)
  56. 2151.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    The commissioner may immediately suspend or bar an agent if the Section 2150 factors are met and public protection requires it, and the agent or licensee may seek a hearing and judicial review.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2151. (a) If the commissioner finds that any of the factors set forth in Section 2150 is true with respect to any agent and that it is necessary for the protection of the public interest, the commissioner may issue an order immediately suspending or barring that agent from continuing to be or becoming an agent of any licensee during the period for which that order is in effect. (b) Within 30 days after an order is issued pursuant to subdivision (a), the licensee or the agent or former agent with respect to whom the order was issued may file with the commissioner an application for a hearing on the order. (c) If the commissioner fails to commence a hearing within 20 business days after the application is filed with the commissioner pursuant to subdivision (b) or within a longer period of time agreed to by the parties, the suspension or revocation shall be deemed rescinded. (d) Within 30 days after the hearing, the commissioner shall affirm, modify, or rescind the order. (e) The right of the licensee or agent or former agent to petition for judicial review of the order shall not be affected by the failure of that person to apply to the commissioner for a hearing on the order pursuant to subdivision (b). (Added by Stats. 2011, Ch. 243, Sec. 4. (SB 664) Effective January 1, 2012.)
  57. 2151.1.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    The commissioner may assess a civil penalty against a person who violates this division, related regulations, or an order issued under it.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2151.1. The commissioner may assess a civil penalty against a person that violates this division or a regulation adopted or an order issued under this division in an amount not to exceed one thousand dollars ($1,000) for each violation or, in the case of a continuing violation, one thousand dollars ($1,000) for each day or part thereof during which the violation continues, plus this state’s costs and expenses for the investigation and prosecution of the matter, including reasonable attorney’s fees. (Amended by Stats. 2012, Ch. 356, Sec. 27. (SB 979) Effective January 1, 2013.)
  58. 2152.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    A person must not file false records or make false entries in required records, and must not knowingly do licensed activity without a license unless exempt; violations are felonies.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2152. (a) A person that intentionally makes a false statement, misrepresentation, or false certification in a record filed or required to be maintained under this division or that intentionally makes a false entry or omits a material entry in such a record is guilty of a felony. (b) A person that knowingly engages in an activity for which a license is required under this division without being licensed or exempt from licensure under this division is guilty of a felony. (c) Nothing in this division limits the power of the state to punish any person for any act that constitutes a crime under any statute. (Amended by Stats. 2012, Ch. 356, Sec. 28. (SB 979) Effective January 1, 2013.)
  59. 2153.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    This section says the division’s enforcement provisions add to any other enforcement powers the commissioner may already have under law.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 8. Additional Enforcement Provisions [2148 - 2153] ( Chapter 8 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2153. The enforcement provisions of this division are in addition to any other enforcement powers that the commissioner may have under law. (Amended by Stats. 2012, Ch. 356, Sec. 29. (SB 979) Effective January 1, 2013.)
  60. 217.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 1. Definitions [99 - 217] ( Chapter 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    “Voting power” is defined by reference to Section 194.5 of the Corporations Code.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 1. Definitions [99 - 217] ( Chapter 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 217. “Voting power” has the meaning set forth in Section 194.5 of the Corporations Code. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  61. 2170.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 9. Miscellaneous Provisions [2170 - 2176] ( Chapter 9 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    A licensee may surrender its license by filing the license and a required report with the commissioner.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 9. Miscellaneous Provisions [2170 - 2176] ( Chapter 9 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2170. Any licensee may surrender its license by filing with the commissioner the license and a report with any information as the commissioner requires. The voluntary surrender of the license shall become effective at the time and upon the conditions as the commissioner specifies by order. (Added by Stats. 2011, Ch. 243, Sec. 4. (SB 664) Effective January 1, 2012.)
  62. 2171.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 9. Miscellaneous Provisions [2170 - 2176] ( Chapter 9 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    If part of this division is invalid or unenforceable, the rest still applies if it can work without that part.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 9. Miscellaneous Provisions [2170 - 2176] ( Chapter 9 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2171. If any provision of this division or the application thereof to any person or circumstances is held invalid, illegal, or unenforceable, that invalidity, illegality, or unenforceability shall not affect other provisions or applications of this division that can be given effect without the invalid, illegal, or unenforceable provision or application, and to this end, the provisions of this division are declared to be severable. (Amended by Stats. 2012, Ch. 356, Sec. 30. (SB 979) Effective January 1, 2013.)
  63. 2172.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 9. Miscellaneous Provisions [2170 - 2176] ( Chapter 9 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    Some existing licenses stay valid, and certain unlicensed persons had to apply by July 1, 2011 to keep conducting money transmission. If the application was timely filed and pending with the commissioner, the person could keep operating until the application was approved, abandoned, or denied.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 9. Miscellaneous Provisions [2170 - 2176] ( Chapter 9 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2172. (a) A license issued under the former Chapter 14 (commencing with Section 1800), Chapter 14A (commencing with Section 1851), or the former Division 16 (commencing with Section 33000) that is in effect immediately before January 1, 2011, shall remain in effect as a valid license under this division. (b) Any person that, prior to January 1, 2011, was not required to obtain a license under the former Chapter 14 (commencing with Section 1800), Chapter 14A (commencing with Section 1851), or Division 16 (commencing with Section 33000), but is required to have a license under this division, shall file an application for a license pursuant to this division by July 1, 2011, in order to continue conducting money transmission in this state directly or through agents. If the application is timely filed and pending with the commissioner, that person may continue to conduct money transmission in this state, until the application has been approved, abandoned, or denied. (Amended by Stats. 2012, Ch. 356, Sec. 31. (SB 979) Effective January 1, 2013.)
  64. 2174.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 9. Miscellaneous Provisions [2170 - 2176] ( Chapter 9 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    The commissioner may issue written guidance, and must post all such guidance publicly on the commissioner’s website. The commissioner may redact proprietary or confidential information in some cases.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 9. Miscellaneous Provisions [2170 - 2176] ( Chapter 9 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2174. (a) The commissioner may prepare written decisions, opinion letters, and other formal written guidance to be issued to persons seeking clarification regarding the requirements of this division. (b) The commissioner shall make public on the commissioner’s Internet Web site all written decisions, opinion letters, and other formal written guidance issued to persons seeking clarification regarding the requirements of this division. The commissioner may, at his or her discretion or upon request by an applicant or licensee, redact proprietary or other confidential information regarding an applicant or licensee from any decision, letter, or other written guidance issued in connection with an applicant or licensee. (Added by Stats. 2013, Ch. 533, Sec. 9. (AB 786) Effective January 1, 2014.)
  65. 2175.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 9. Miscellaneous Provisions [2170 - 2176] ( Chapter 9 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    The commissioner may give informal guidance to prospective license applicants, and must tell a requesting applicant the minimum net worth and other licensing requirements that will apply.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 9. Miscellaneous Provisions [2170 - 2176] ( Chapter 9 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2175. The commissioner may offer informal guidance to any prospective applicant for a license under this division, regarding the conditions of licensure that may be applied to that person. The commissioner shall inform any applicant that requests that guidance of the minimum net worth, and other licensing requirements, that will be required of that applicant, based on the information provided by the applicant concerning its plan to conduct business under this division, and the factors used to make that determination as described in Section 2040. (Amended by Stats. 2014, Ch. 499, Sec. 16. (AB 2209) Effective January 1, 2015.)
  66. 2176.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 9. Miscellaneous Provisions [2170 - 2176] ( Chapter 9 added by Stats. 2011, Ch. 243, Sec. 4. )

    Verify source ↗

    The commissioner may exercise any power in this division over a money transmission business when needed for the public’s general welfare.

    ## Financial Code - FIN ## DIVISION 1.2. MONEY TRANSMISSION ACT [2000 - 2176] ( Division 1.2 added by Stats. 2011, Ch. 243, Sec. 4. ) ## CHAPTER 9. Miscellaneous Provisions [2170 - 2176] ( Chapter 9 added by Stats. 2011, Ch. 243, Sec. 4. ) ## 2176. At any time, if the commissioner deems it necessary for the general welfare of the public, he or she may exercise any power set forth in this division with respect to a money transmission business, regardless of whether an application for a license has been filed with the commissioner, a license has been issued, or, if issued, the license has been surrendered, suspended, or revoked. (Added by Stats. 2014, Ch. 499, Sec. 17. (AB 2209) Effective January 1, 2015.)
  67. 22.

    ## Financial Code - FIN ## GENERAL PROVISIONS ( General Provisions enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    Chapter 10 of Division 2 is known and may be cited as the Vuich-Calderon Financial Institutions Act of 1986.

    ## Financial Code - FIN ## GENERAL PROVISIONS ( General Provisions enacted by Stats. 1951, Ch. 364. ) ## 22. Notwithstanding any other provision of this code, Chapter 10 (commencing with Section 10000) of Division 2 shall be known and may be cited as the Vuich-Calderon Financial Institutions Act of 1986. (Amended by Stats. 2000, Ch. 375, Sec. 8. Effective January 1, 2001.)
  68. 22000.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This division is known and may be cited as the California Financing Law.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22000. This division is known and may be cited as the “California Financing Law.” (Amended by Stats. 2017, Ch. 475, Sec. 4. (AB 1284) Effective October 4, 2017.)
  69. 22001.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section says the division should be read broadly to support its purposes, and it states which chapters apply to consumer loans, commercial loans, and program administrators.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22001. (a) This division shall be liberally construed and applied to promote its underlying purposes and policies, which are: (1) To ensure an adequate supply of credit to borrowers in this state. (2) To simplify, clarify, and modernize the law governing loans made by finance lenders. (3) To foster competition among finance lenders. (4) To protect borrowers against unfair practices by some lenders, having due regard for the interests of legitimate and scrupulous lenders. (5) To permit and encourage the development of fair and economically sound lending practices. (6) To encourage and foster a sound economic climate in this state. (7) To protect property owners from deceptive and misleading practices that threaten the efficacy and viability of property assessed clean energy financing programs. (b) Consumer loans, as defined in Sections 22203 and 22204, are subject to this chapter, Chapter 2 (commencing with Section 22200), Article 1 (commencing with Section 22700) of Chapter 4, and Article 2 (commencing with Section 22750) of Chapter 4. (c) Commercial loans, as defined in Section 22502, are subject to this chapter, Chapter 3 (commencing with Section 22500), Article 1 (commencing with Section 22700) of Chapter 4, and Article 3 (commencing with Section 22780) of Chapter 4. (d) A program administrator, as defined in Section 22018, is subject to this chapter, Chapter 3.5 (commencing with Section 22680), and Article 1 (commencing with Section 22700) of Chapter 4. (e) This section shall become operative on January 1, 2019. (Repealed (in Sec. 5) and added by Stats. 2017, Ch. 475, Sec. 6. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  70. 22002.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This provision says the division creates exempt persons and preserves existing exemptions for certain brokers and lenders.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22002. To accomplish its underlying purposes and policies, this division creates a class of exempt persons pursuant to Section 1 of Article XV of the California Constitution. It is the intent of the Legislature to preserve existing exemptions under Section 1 of Article XV of the Constitution and statutory law for (a) personal property brokers formerly regulated by the Personal Property Brokers Law; (b) lenders formerly regulated by the Consumer Finance Lenders Law; and (c) lenders formerly regulated by the Commercial Finance Lenders Law; and no finding that any provision of this division is invalid with respect to a particular lender or class of lenders shall affect the enforceability of this division with respect to any of the foregoing classifications of lenders, which shall in all events continue to be exempted by this division. (Repealed and added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  71. 22003.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    The definitions in this article control how this division is interpreted unless the context requires otherwise.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22003. Unless the context otherwise requires, the definitions given in this article govern the construction of this division. (Repealed and added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  72. 22004.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section defines “broker” to include a person engaged in negotiating or acting as a broker for loans made by a finance lender.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22004. “Broker” includes any person who is engaged in the business of negotiating or performing any act as broker in connection with loans made by a finance lender. (Repealed and added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  73. 22005.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section defines “Commissioner” as the Commissioner of Financial Protection and Innovation.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22005. “Commissioner” means the Commissioner of Financial Protection and Innovation. (Amended by Stats. 2022, Ch. 452, Sec. 132. (SB 1498) Effective January 1, 2023.)
  74. 22006.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section says certain terms used in the division have the meanings given in the Uniform Commercial Code.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22006. As used in this division, the terms “security interest,” “accounts,” “chattel paper,” “documents,” “general intangibles,” “goods,” and “instruments” are as defined in the Uniform Commercial Code. (Repealed and added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  75. 22007.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section defines “licensee” and says the section becomes operative on January 1, 2019.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22007. (a) “Licensee” means any finance lender, broker, or program administrator who receives a license in accordance with this division. (b) This section shall become operative on January 1, 2019. (Repealed (in Sec. 8) and added by Stats. 2017, Ch. 475, Sec. 9. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  76. 22008.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section defines “person” to include many types of individuals, business entities, organizations, and governments.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22008. “Person” means an individual, a corporation, a partnership, a limited liability company, a joint venture, an association, a joint stock company, a trust, an unincorporated organization, a government, or a political subdivision of a government. (Repealed and added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  77. 22009.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section defines “finance lender” to include people engaged in making consumer loans or commercial loans.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22009. “Finance lender” includes any person who is engaged in the business of making consumer loans or making commercial loans. The business of making consumer loans or commercial loans may include lending money and taking, in the name of the lender, or in any other name, in whole or in part, as security for a loan, any contract or obligation involving the forfeiture of rights in or to personal property, the use and possession of which property is retained by other than the mortgagee or lender, or any lien on, assignment of, or power of attorney relative to wages, salary, earnings, income, or commission. It is the intent of the Legislature that the definition of finance lender shall be interpreted to include a personal property broker as referenced in Section 1 of Article XV of the California Constitution. (Repealed and added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  78. 22010.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    Certain employees are excluded from the listed license definitions, and employees acting within the scope of employment are exempt from laws their employer is exempt from.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22010. (a) “Finance lender,” “broker,” and “program administrator” do not include employees regularly employed at the location specified in the license of the finance lender, broker, or program administrator, except that an employee, when acting within the scope of his or her employment, shall be exempt from any other law from which his or her employer is exempt. (b) This section shall become operative on January 1, 2019. (Repealed (in Sec. 10) and added by Stats. 2017, Ch. 475, Sec. 11. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  79. 22011.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section defines “regulatory ceiling provision” as a statement that sets a principal loan amount threshold above which the section or subdivision does not apply.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22011. A “regulatory ceiling provision” is a statement in a section or subdivision that specifies an original bona fide principal loan amount at or above which that section or subdivision does not apply to a loan. (Repealed and added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  80. 22012.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section defines several terms used in California Financing Law, including license, institution, agencies, mortgage-related terms, and expungement.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22012. (a) “Branch office license” means a license to engage in business as a finance lender or broker at a location other than the location identified in a finance lender or broker license application or amended application. (b) “Depository institution” has the same meaning as in Section 3 of the Federal Deposit Insurance Act, and includes any credit union. (c) “Federal banking agencies” means the Board of Governors of the Federal Reserve System, the Comptroller of the Currency, the Director of the Office of Thrift Supervision, the National Credit Union Administration, and the Federal Deposit Insurance Corporation. (d) “Nationwide Mortgage Licensing System and Registry” means a mortgage licensing system developed and maintained by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators for the licensing and registration of licensed mortgage loan originators. (e) “Residential mortgage loan” means any loan primarily for personal, family, or household use that is secured by a mortgage, deed of trust, or other equivalent consensual security interest on a dwelling, as defined in Section 103(v) of the federal Truth in Lending Act, or residential real estate upon which is constructed or intended to be constructed a dwelling. “Dwelling” means a residential structure that contains one to four units, whether or not that structure is attached to real property. The term includes an individual condominium unit, cooperative unit, mobilehome, or trailer, if it is used as a residence. (f) “SAFE Act” means the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (Public Law 110-289). (g) “Unique identifier” means a number or other identifier assigned by protocols established by the Nationwide Mortgage Licensing System and Registry. (h) For purposes of Sections 22109.2, 22109.3, and 22109.5, “nontraditional mortgage product” means any mortgage product other than a 30-year fixed rate mortgage. (i) For purposes of Section 22109.1, “expungement” means the subsequent order under the provisions of Section 1203.4 of the Penal Code allowing such individual to withdraw his or her plea of guilty and to enter a plea of not guilty, or setting aside the verdict of guilty or dismissing the accusation, information, or indictment. With respect to criminal convictions in another state, that state’s definition of expungement will apply. (Amended by Stats. 2012, Ch. 264, Sec. 1. (AB 2666) Effective January 1, 2013.)
  81. 22013.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section defines several mortgage-lending terms and sets conditions for a nonprofit exemption from the mortgage loan originator rules.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22013. (a) “Mortgage loan originator” means an individual who, for compensation or gain, or in the expectation of compensation or gain, takes a residential mortgage loan application or offers or negotiates terms of a residential mortgage loan. (b) Mortgage loan originator does not include any of the following: (1) An individual who performs purely administrative or clerical tasks on behalf of a person meeting the definition of a mortgage loan originator, except as provided in subdivision (c) of Section 22014. The term “administrative or clerical tasks” means the receipt, collection, and distribution of information common for the processing or underwriting of a loan in the mortgage industry and communication with a consumer to obtain information necessary for the processing or underwriting of a residential mortgage loan, to the extent that the communication does not include offering or negotiating loan rates or terms, or counseling consumers about residential mortgage loan rates or terms. (2) An individual who solely renegotiates terms for existing mortgage loans held or serviced by his or her employer and who does not otherwise act as a mortgage loan originator, unless the United States Department of Housing and Urban Development or a court of competent jurisdiction determines that the SAFE Act requires such an employee to be licensed as a mortgage loan originator under state laws implementing the SAFE Act. (3) An individual that is solely involved in extensions of credit relating to timeshare plans, as that term is defined in Section 101(53D) of Title 11 of the United States Code. (4) An individual licensed as a mortgage loan originator pursuant to the provisions of Article 2.1 (commencing with Section 10166.01) of Chapter 3 of Part 1 of Division 4 of the Business and Professions Code and the SAFE Act. (5) An individual who is an employee of a federal, state, or local government agency or housing finance agency and who acts as a loan originator only pursuant to his or her official duties as an employee of the federal, state, or local government agency or housing finance agency. (A) For purposes of this paragraph, the term “employee” means an individual whose manner and means of performance of work are subject to the right of control of, or are controlled by, a person, and whose compensation for federal income tax purposes is reported, or required to be reported, on a W-2 form issued by the controlling person. (B) For purposes of this paragraph, the term “housing finance agency” means any authority: (i) That is chartered by a state to help meet the affordable housing needs of the residents of the state. (ii) That is supervised directly or indirectly by the state government. (iii) That is subject to audit and review by the state in which it operates. (6) (A) An employee of a bona fide nonprofit organization who exclusively originates residential mortgage loans for a bona fide nonprofit organization, and who acts as a mortgage loan originator only with respect to residential mortgage loans with terms that are favorable to the borrower. (B) To qualify for the exemption under this paragraph, the bona fide nonprofit organization under this paragraph must register with the department on a form prescribed by the commissioner, along with documentation of all of the following by December 31 of each year: (i) Status of a tax-exempt organization under Section 501(c)(3) of the Internal Revenue Code of 1986. (ii) That the organization promotes affordable housing or provides home ownership education or similar services. (iii) That the organization conducts its activities in a manner that serves public or charitable purposes, rather than commercial purposes. (iv) That the organization receives funding and revenue, and charges fees in a manner that does not incentivize the organization or its employees to act other than in the best interests of its clients. (v) That the organization compensates employees in a manner that does not incentivize employees to act other than in the best interests of its clients. (vi) That the organization provides to, or identifies for, the borrower residential mortgage loans with terms favorable to the borrower and comparable to mortgage loans and housing assistance provided under government housing assistance programs. (vii) That the organization is certified by the United States Department of Housing and Urban Development as a housing counselor who engages solely in traditional housing counseling services, if applicable. (C) The commissioner may periodically require reports regarding the activities of the bona fide nonprofit organization, and shall examine the nonprofit organization’s books and records in accordance with the regulations of the United States Department of Housing and Urban Development, or any successor guidance or requirement by the Consumer Financial Protection Bureau. If the nonprofit organization fails to provide documentation as required by subparagraph (B), or if it does not continue to meet the criteria under subparagraph (B), the commissioner may revoke the nonprofit organization’s status as a registered bona fide nonprofit organization. (D) For residential mortgage loans to have terms that are favorable to the borrower, the terms shall be consistent with loan origination in a public or charitable context, rather than a commercial context. (E) In making its determinations and examinations, the commissioner may rely on the receipt and review of: (i) Reports filed with federal, state, or local housing agencies and authorities. (ii) Reports and attestations prescribed by the commissioner by rule or order. (c) “Registered mortgage loan originator” means any individual who is all of the following: (1) Meets the definition of mortgage loan originator. (2) Is an employee of a depository institution, a subsidiary that is owned and controlled by a depository institution and regulated by a federal banking agency, or an institution regulated by the Farm Credit Administration. (3) Is registered with, and maintains a unique identifier through, the Nationwide Mortgage Licensing System and Registry. (d) “Loan processor or underwriter” means an individual who performs clerical or support duties as an employee at the direction of, and subject to the supervision and instruction of, a mortgage loan originator licensed by the state or a registered mortgage loan originator. (Amended by Stats. 2012, Ch. 264, Sec. 2. (AB 2666) Effective January 1, 2013.)
  82. 22014.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    Some loan processors and underwriters do not need a mortgage loan originator license if they do not present themselves as performing mortgage loan originator activities; independent contractors in those roles must be licensed to work on residential mortgage loans and must keep a valid unique identifier.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22014. (a) A loan processor or underwriter who does not represent to the public, through advertising or other means of communicating or providing information, including the use of business cards, stationery, brochures, signs, rate lists, or other promotional items, that the individual can or will perform any of the activities of a mortgage loan originator shall not be required to be licensed as a mortgage loan originator. (b) An individual engaging solely in loan processor or underwriter activities shall not represent to the public, through advertising or other means of communicating or providing information including the use of business cards, stationery, brochures, signs, rate lists, or other promotional items, that the individual can or will perform any of the activities of a mortgage loan originator. (c) An independent contractor may not engage in the activities of a loan processor or underwriter for a residential mortgage loan unless the independent contractor loan processor or underwriter obtains and maintains a mortgage loan originator license under this division. Each independent contractor loan processor or underwriter licensed as a mortgage loan originator shall have and maintain a valid unique identifier issued by the Nationwide Mortgage Licensing System and Registry. (Added by Stats. 2009, Ch. 160, Sec. 11. (SB 36) Effective October 11, 2009.)
  83. 22015.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    “PACE assessment” is defined as a voluntary contractual assessment, voluntary special tax, or special tax.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22015. “PACE assessment” means a voluntary contractual assessment, voluntary special tax, or special tax, as described in subdivisions (a), (b), and (c) of Section 26054 of the Public Resources Code. (Added by Stats. 2017, Ch. 475, Sec. 12. (AB 1284) Effective October 4, 2017.)
  84. 22016.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    “PACE program” is defined as a program that finances efficiency improvements on real property through property assessments.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22016. “PACE program” means a program in which financing is provided for the installation of efficiency improvements on real property and funded through the use of property assessments, as well as other program components defined in this section, established pursuant to any of the following: (a) Chapter 29 (commencing with Section 5898.10) of Part 3 of Division 7 of the Streets and Highways Code. (b) The Mello-Roos Community Facilities Act of 1982 (Chapter 2.5 (commencing with Section 53311) of Part 1 of Division 2 of Title 5 of the Government Code). (c) A charter city’s constitutional authority under Section 5 of Article XI of the California Constitution. (Added by Stats. 2017, Ch. 475, Sec. 13. (AB 1284) Effective October 4, 2017.)
  85. 22017.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section defines “PACE solicitor” and “PACE solicitor agent,” and lists several people who are not covered by those terms.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22017. (a) “PACE solicitor” means a person authorized by a program administrator to solicit a property owner to enter into an assessment contract. (b) “PACE solicitor agent” means an individual who is employed or retained by, and acts on behalf of, a PACE solicitor to solicit a property owner to enter into an assessment contract. (c) “PACE solicitor” and “PACE solicitor agent” do not include any of the following: (1) A person employed by a program administrator. (2) A person, including a home improvement contractor or subcontractor, who does not solicit property owners to enter into assessment contracts. (3) A person who performs purely administrative or clerical tasks. (4) A person who advertises a PACE program, if the content of the advertising is created, prepared, or approved by a program administrator, and advertising is subject to, and in compliance with this division. (5) A person who obtains information regarding prospective applicants for PACE financing, or who provides to a program administrator information regarding prospective applicants for PACE financing, if that information was not obtained in connection with advertising or soliciting a PACE program. (6) A person who only solicits a property owner to enter into an assessment contract with a person who is not considered a program administrator within the meaning of subdivision (b) of Section 22018. (Amended by Stats. 2018, Ch. 813, Sec. 1. (AB 2063) Effective January 1, 2019.)
  86. 22018.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section defines “program administrator” and excludes public agencies and certain people who do not administer specified PACE financing programs.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22018. (a) “Program administrator” means a person administering a PACE program on behalf of, and with the written consent of, a public agency. “Program administrator” does not include a public agency. (b) For purposes of this division, “program administrator” does not include a person who meets both of the following conditions: (1) The person does not administer a PACE program that provides financing for the installation of efficiency improvements on residential property with four or fewer units. (2) The person does not administer a PACE program that provides financing for the installation of efficiency improvements on real property with a market value of less than one million dollars ($1,000,000). (Amended by Stats. 2018, Ch. 813, Sec. 2. (AB 2063) Effective January 1, 2019.)
  87. 22018.5.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    “Property owner” is defined as all property owners of record on the property subject to the PACE assessment.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22018.5. “Property owner” means all property owners of record on the property subject to the PACE assessment. (Added by Stats. 2017, Ch. 475, Sec. 16. (AB 1284) Effective October 4, 2017.)
  88. 22019.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    “Efficiency improvement” means permanent improvements fixed to real property that are financed through a PACE assessment.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22019. “Efficiency improvement” means one or more permanent improvements fixed to real property financed through a PACE assessment. (Added by Stats. 2017, Ch. 475, Sec. 17. (AB 1284) Effective October 4, 2017.)
  89. 22020.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section defines “public agency” for this chapter.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22000 - 22020] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22020. “Public agency” means a city, including a charter city, county, city and county, municipal utility district, community services district, community facilities district, joint powers authority, sanitary district, sanitation district, or water district, as defined in Section 20200 of the Water Code, that has established or participates in a PACE program, and utilizes a program administrator. (Added by Stats. 2017, Ch. 475, Sec. 18. (AB 1284) Effective October 4, 2017.)
  90. 22050.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section lists several groups and transactions that are exempt from the division’s rules.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22050. (a) This division does not apply to any person doing business under any law of any state or of the United States relating to banks, trust companies, savings and loan associations, insurance premium finance agencies, credit unions, small business investment companies, community advantage lenders, California business and industrial development corporations when acting under federal law or other state authority, or licensed pawnbrokers when acting under the authority of that license. “Community advantage lender” means an entity authorized by the United States Small Business Administration to deliver community advantage loans. (b) This division does not apply to a check casher who holds a valid permit issued pursuant to Section 1789.37 of the Civil Code when acting under the authority of that permit, and shall not apply to a person holding a valid license issued pursuant to Section 23005 of the Financial Code when acting under the authority of that license. (c) This division does not apply to a college or university making a loan for the purpose of permitting a person to pursue a program or course of study leading to a degree or certificate. (d) This division does not apply to a broker-dealer acting pursuant to a certificate then in effect and issued pursuant to Section 25211 of the Corporations Code. (e) This division does not apply to any person who makes five or fewer loans in a 12-month period, these loans are commercial loans as defined in Section 22502, and the loans are incidental to the business of the person relying upon the exemption. (f) This division does not apply to any public corporation as defined in Section 67510 of the Government Code, any public entity other than the state as defined in Section 811.2 of the Government Code, or any agency of any one or more of the foregoing, when making any loan so long as the public corporation, public entity, or agency of any one or more of the foregoing complies with all applicable federal and state laws and regulations. (Amended by Stats. 2013, Ch. 243, Sec. 1. (AB 1091) Effective January 1, 2014.)
  91. 22050.5.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This division does not apply to a person who makes no more than one loan in a 12-month period, if the loan is a commercial loan defined in Section 22502.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22050.5. This division does not apply to any person who makes no more than one loan in a 12-month period if that loan is a commercial loan as defined in Section 22502. (Added by Stats. 2022, Ch. 16, Sec. 4. (SB 577) Effective April 28, 2022.)
  92. 22051.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section says the division does not apply to several listed types of cooperative, agricultural, or certain corporation entities.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22051. This division does not apply to the following: (a) Any nonprofit cooperative association organized under Chapter 1 (commencing with Section 54001) of Division 20 of the Food and Agricultural Code that loans or advances money in connection with any activity mentioned in that chapter. (b) Any corporation, association, syndicate, joint stock company, or partnership engaged exclusively in the business of marketing agricultural, horticultural, viticultural, dairy, livestock, poultry, or bee products on a cooperative nonprofit basis that loans or advances money to its members or in connection with those businesses. (c) Any corporation securing money or credit from any federal intermediate credit bank organized and existing pursuant to the provisions of an act of Congress entitled “Agricultural Credits Act of 1923” that loans or advances money or credit so secured. (d) Any corporation created pursuant to the provisions of Part 5 (commencing with Section 14000) of Division 3 of Title 1 of the Corporations Code. (Repealed and added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  93. 22052.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    Section 22052 exempts certain loans of credit from this division when they are made under a qualifying credit-card plan.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22052. This division does not apply to any loan of credit made by a person not licensed under this division pursuant to a plan having all of the following characteristics: (a) Credit cards issued pursuant to a written application and to the plan whereby the organization issuing the cards can acquire those obligations that its members in good standing incur with those persons with whom the organization has entered into written agreements setting forth the plan, and where the obligations are incurred pursuant to those agreements; or whereby the organization issuing the cards can extend credit to its members. (b) The fee for the credit cards is designed to cover the administrative costs of the plan and is imposed upon the issuance of the card and on annual renewal dates thereafter. (c) Any charges, discounts, or fees resulting from the acquisition of the charges is paid to the organization issuing the credit cards by the persons, corporations, or associations with whom the organization has entered into written agreements. (Repealed and added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  94. 22053.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    A person claiming an exemption must prove it in any proceeding under this law.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22053. In any proceeding under this law, the burden of proving an exemption is upon the person claiming it. (Repealed and added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  95. 22054.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section says the division does not apply to bona fide conditional contracts for selling personal property, as long as the agreements are not used to evade the division.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22054. This division does not apply to bona fide conditional contracts of sale involving the disposition of personal property when these forms of sales agreements are not used for the purpose of evading this division. (Repealed and added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  96. 22055.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This division does not apply to premium financing defined in Section 18563.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22055. This division does not apply to premium financing as defined in Section 18563. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  97. 22056.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This division does not apply to the California Infrastructure and Economic Development Bank, certain authorized programs under the Corporations Code, or the California Integrated Waste Management Board.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22056. This division does not apply to the California Infrastructure and Economic Development Bank, any program authorized pursuant to Chapter 1 (commencing with Section 14000) of Part 5 of Division 3 of Title 1 of the Corporations Code, or to the California Integrated Waste Management Board. (Amended by Stats. 2004, Ch. 225, Sec. 10. Effective August 16, 2004.)
  98. 22057.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    The division does not apply to certain real-estate-broker loans secured by real property, and licensed real estate brokers may make or arrange those loans without getting a license under this division.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22057. This division does not apply to any loan that is made or arranged by any person licensed as a real estate broker by the state and secured by a lien on real property, or to any licensed real estate broker when making such a loan. A licensed real estate broker may make a loan secured by a lien on real property for sale to a finance lender or arrange for a loan secured by a lien on real property to be made by a finance lender without obtaining a license under this division. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  99. 22058.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    This division does not apply to cemetery brokers licensed under the Cemetery Act.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22058. This division does not apply to any cemetery broker licensed under the Cemetery Act (Chapter 19 (commencing with Section 9600) of Division 3 of the Business and Professions Code). (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  100. 22059.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A broker license does not allow the licensee to act as a broker for loans made or to be made by an unlicensed finance lender.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22059. A license to act as a broker under this division does not authorize the licensee to negotiate or perform any act as a broker in connection with loans made or to be made by a lender not licensed as a finance lender under this division. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  101. 22060.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    This division does not apply to certain loans made or arranged by a licensed residential mortgage lender or servicer acting under that license.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22060. This division does not apply to a loan made or arranged by a licensed residential mortgage lender or servicer when acting under the authority of that license. (Added by Stats. 1995, Ch. 564, Sec. 6.5. Effective January 1, 1996.)
  102. 22061.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    This section exempts nonprofit church extension funds from this division and defines several related terms.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22061. (a) This division does not apply to any nonprofit church extension fund. (b) For purposes of this section: (1) “Nonprofit church extension fund” means a nonprofit organization affiliated with a church, that is formed for the purpose of making loans to that church’s congregational organization or organizations for site acquisitions, new facilities, or improvements to existing facilities, purchased for the benefit of the church congregational organization. (2) What constitutes a “church” shall be determined from the following criteria, none of which has controlling weight: a distinct legal existence; a recognized creed and form of worship; a definite and distinct ecclesiastical government; a formal code of doctrine and discipline; a distinct religious history; a membership not associated with any other religion or denomination; a complete organization of ordained ministers ministering to their congregations; ordained ministers selected after completing prescribed courses of study; a literature of its own; established places of worship; regular congregations; regular religious services; schools for the religious instruction of youth; and schools for the preparation of its ministers. (3) “Church congregational organization” means a group of individuals who gather for the purpose of practicing the religion or manner of worship promulgated by the church with which the organization is affiliated. (4) “Site acquisitions” means purchases of land intended for use by a church congregational organization. (5) “New facilities” means purchases of buildings or structures intended for use by a church congregational organization. (6) “Improvements” means purchases of materials intended to increase the quality of existing religious sites or facilities. (c) For purposes of this section, a nonprofit church extension fund shall establish that it is exempt from federal taxation pursuant to Section 501 of Title 26 of the United States Code. (d) For purposes of this section, no individual may be held responsible for the repayment of any loan made by a nonprofit church extension fund. (Added by Stats. 1998, Ch. 469, Sec. 1. Effective January 1, 1999.)
  103. 22062.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    This section exempts certain venture capital financing from this division.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22062. (a) This division does not apply to either of the following: (1) A commercial bridge loan made by a venture capital company to an operating company. (2) A venture capital investment made by a venture capital company in an equity security issued by an operating company. (b) For purposes of this section: (1) “Venture capital company” means a person other than an individual or sole proprietorship that meets all of the following: (A) Engages primarily in the business of promoting economic, business, or industrial development through venture capital investments or the provision of financial or management assistance to operating companies. (B) At all times maintains at least 50 percent of its assets in venture capital investments or commitments to make venture capital investments, and maintains or, assuming consummation of the equity investment to which the commercial bridge loan relates, will maintain a material equity interest in the operating company. (C) Approves each loan made to an operating company through the venture capital company’s board of directors, executive committee, or similar policy body, based on a reasonable belief that the loan is appropriate for the operating company after reasonable inquiry concerning the operating company’s financing objectives and financial situation. (D) Complies, when making the loan, with all applicable federal and state laws and rules or orders governing securities transactions including, but not limited to, the Securities Act of 1933, the Securities Exchange Act of 1934, the Investment Company Act of 1940, and the Corporate Securities Law of 1968. (2) “Operating company” means a person that meets all of the following: (A) Primarily engages, wholly or substantially, directly or indirectly through a majority owned subsidiary or subsidiaries, in the production or sale, or the research or development, of a product or service other than the management or investment of capital. This shall not include any of the following: (i) A person that is either an individual or a sole proprietorship. (ii) A person that has no specific business plan or purpose or has indicated that its business plan is to engage in a merger or acquisition with an unidentified company or companies or other entity or person. (B) Uses all of the proceeds of the commercial bridge loan for the operations of its business. (C) Approves each commercial bridge loan through its board of directors, executive committee, or similar policy board, in the exercise of its fiduciary duty, based on a reasonable belief that the loan is appropriate for the operating company after reasonable inquiry concerning the operating company’s financing objectives and financial situation. (3) “Commercial bridge loan” means a loan that meets all of the following criteria: (A) A loan of a principal amount of five thousand dollars ($5,000) or more, or any loan under an open-end credit program, whether secured by personal property or unsecured, the proceeds of which are intended by the operating company for use primarily for other than personal, family, or household purposes. (B) Is made with a maturity date not to exceed three years, and in connection with or in bona fide contemplation of, an equity investment in the operating company. (C) Is secured, if at all, solely by the operating company’s business assets, exclusive of any real property. (D) Is subject to the implied covenant of good faith and fair dealing under Section 1655 of the Civil Code. (4) For purposes of paragraph (1), “venture capital investment” is an acquisition of securities in an operating company that a person, an investment adviser of the person, or an affiliated person of either, has or obtains management rights to. (5) “Equity security” shall have the same meaning as in Section 3(a)(11) of the federal Securities Exchange Act of 1934. (c) For purposes of paragraph (3) of subdivision (b), for the purposes of determining whether a loan is a commercial bridge loan, a venture capital company may rely on any written statement of intended purposes signed by the operating company. The statement may be a separate statement signed by the operating company or may be contained in another document signed by the operating company, but in each case it shall be approved by its board of directors, executive committee, or similar policy body. The venture capital company may not be required to ascertain that the proceeds of the loan are used in accordance with the statement of intended purposes. (d) For purposes of subparagraph (A) of paragraph (3) of subdivision (b), the principles set forth in Section 22551 shall be used to determine whether the specified amount of a commercial bridge loan is a bona fide principal amount. (e) Nothing in this section is intended to abrogate or diminish the application of any other laws that are designed to protect borrowers, including, but not limited to, laws pertaining to licensing, unfair competition, usury, and conflicts of interest. (Amended by Stats. 2014, Ch. 68, Sec. 1. (SB 1181) Effective January 1, 2015.)
  104. 22063.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    This section exempts certain franchise loans from the division and requires the lender to disclose interest, charges, and costs when the loan is made.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22063. (a) This division does not apply to a franchise loan made by a franchisor to a franchisee or a subfranchisor or by a subfranchisor to a franchisee. (b) For purposes of this section: (1) “Franchise” means “franchise,” as defined in Section 31005 of the Corporations Code. (2) “Franchisee” means “franchisee,” as defined in Section 31006 of the Corporations Code. (3) “Franchisor” means “franchisor,” as defined in Section 31007 of the Corporations Code. (4) “Area franchise” means “area franchise,” as defined in Section 31008 of the Corporations Code. (5) “Subfranchise” means “subfranchise,” as defined in Section 31008.5 of the Corporations Code. (6) “Subfranchisor” means “subfranchisor,” as defined in Section 31009 of the Corporations Code. (7) “Franchised business” means a business operated pursuant to a franchise or area franchise by a franchisee or pursuant to a franchise, area franchise or subfranchise by a subfranchisor. (8) “Franchise loan” means a commercial loan, as defined in Section 22502, made by a franchisor to a current or prospective franchisee or subfranchisor or a commercial loan by a subfranchisor to a current or prospective franchisee for the acquisition, construction, operation, development, equipping, expansion, contraction, consolidation, merger, recapitalization, reorganization, or termination of a franchised business provided that the following conditions are satisfied: (A) The franchisor or subfranchisor making the franchise loan shall comply with all applicable federal and state franchise disclosure and registration laws, regulations, rules and orders, including, but not limited to, the California Franchise Investment Law (Division 5 (commencing with Section 31000) of Title 4 of the Corporations Code) and the Federal Trade Commission Franchise Rule: Disclosure Requirements and Prohibitions Concerning Franchising and Business Opportunity Ventures (Code of Federal Regulations, Title 16, Chapter 1, Subchapter D, Part 436 (16 CFR 436), as amended) in connection with the offer or sale of any franchise, area franchise, or subfranchise to which the franchise loan relates. (B) The proceeds of the franchise loan are intended by the borrowing franchisee or subfranchisor for use primarily for other than personal, family, or household purposes. (C) The loan, if secured, is secured solely by the assets of the franchised business to which the franchise loan relates. Property used by the borrower primarily for personal, family, or household purposes, including the borrower’s personal residence, shall not be taken as security for the loan. (D) The loan is subject to the implied covenant of good faith and fair dealing under Section 1655 of the Civil Code. (E) The lender shall fully and clearly disclose to the borrower, at or before the time the loan is made, the rates of interest, charges, and costs of the loan. (c) For purposes of subparagraph (B) of paragraph (8) of subdivision (b), a lending franchisor or subfranchisor may rely on any written statement of intended purposes by the borrowing franchisee or subfranchisor. The statement may be a separate statement signed by the borrowing franchisee or subfranchisor or may be contained in another document signed by the borrowing franchisee or subfranchisor. The lending franchisor or subfranchisor may not be required to ascertain that the proceeds of a franchise loan are used in accordance with the statement of intended purposes. (d) Nothing in this section is intended to abrogate or diminish the application of any other laws that are designed to protect borrowers, including, but not limited to, laws pertaining to licensing, unfair competition, usury and conflicts of interest. (Added by Stats. 2004, Ch. 458, Sec. 16. Effective September 10, 2004.)
  105. 22064.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    This section excludes certain program-related investments, loans, guaranties, and investments from this division if specific nonprofit and purpose conditions are met.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22064. (a) This division does not apply to the following: (1) A program-related investment defined in subsection (c) of Section 4944 of the Internal Revenue Code and United States Treasury Regulations Section 53.4944-3 that is made by a private foundation, tax-exempt organization within the meaning of Section 509(a) of the Internal Revenue Code. (2) A loan, guaranty, or investment made by a public charity, tax-exempt organization within the meaning of paragraph (1), (2), or (3) of subsection (a) of Section 509 of the Internal Revenue Code that meets all of the following requirements: (A) The primary purpose of the loan, guaranty, or investment is to accomplish one or more of the exempt purposes of the public charity making the loan, as described in Section 170(c)(2)(B) of the Internal Revenue Code. (B) Neither the production of income nor the appreciation of property is a significant purpose of the loan, guaranty, or investment. (C) No purpose of the loan, guaranty, or investment is to accomplish one or more of the purposes described in Section 170(c)(2)(D) of the Internal Revenue Code. (b) Subdivision (a) shall not exempt from the provisions of this division a tax-exempt organization that is making consumer loans as defined in Sections 22203 and 22204. (c) A loan that is secured by any assets owned by an individual shall be exempt under subdivision (a) only if the individual providing the security is an “accredited investor” as defined in paragraph (5) or (6) of subsection (a) of Section 230.501 of Title 17 of the Code of Federal Regulations. Property held by an individual for personal, family, or household purposes, including an individual’s personal residence, may not be taken as security for a loan. (d) A program-related investment by a private foundation, and any loan, guaranty, or investment made by a public charity that is exempt under subdivision (a) is subject to the implied covenant of good faith and fair dealing under Section 1655 of the Civil Code. (e) (1) Subdivision (a) shall exempt from the provisions of this division a program-related investment by a private foundation, or a loan, guaranty, or investment by a public charity, only if the following conditions are satisfied: (A) The organization making the program-related investment, loan, guaranty, or investment is exempt from federal income taxes under Section 501(c)(3) of the Internal Revenue Code and is organized and operated exclusively for one or more of the purposes described in Section 501(c)(3) of the Internal Revenue Code. (B) No part of the net earnings of the organization making the program-related investment, loan, guaranty or investment inures to the benefit of a private shareholder or individual. (C) No broker’s fee will be paid in connection with the making of the program-related investment, loan, guaranty, or investment or placement of the program-related investment, loan, guaranty or investment. (2) This subdivision does not prohibit the organization making the program-related investment, loan, guaranty, or investment from charging interest on the loan or investment or fees on the guaranty. (f) Subdivision (a) shall only exempt from the provisions of this division a program-related investment by a private foundation or a loan, guaranty, or investment by a public charity that is made for the primary purpose of accomplishing one or more of the organization’s exempt purposes described in Section 501(c)(3) of the Internal Revenue Code, and no significant purpose of which is the production of income or the appreciation of property within the meaning of subsection (c) of Section 4944 of the Internal Revenue Code. A recipient shall be required to use all funds received from the private foundation or the public charity only for the charitable purposes for which the program-related investment, loan, guaranty, or investment was made. (g) Subdivision (a) shall only exempt from the provisions of this division a program-related investment by a private foundation or a loan, guaranty, or investment by a public charity if the organization consummates not more than 35 loans in a calendar year. In the making and negotiating of these loans, the private foundation or public charity shall take into consideration the financial ability of the recipients to repay the loans in the time and manner provided. (h) Nothing in this section is intended to abrogate or diminish the application of any other applicable laws that are designed to govern the tax-exempt organizations described in subdivision (a), including, but not limited to, laws pertaining to recordkeeping and reporting to the Attorney General and the Internal Revenue Service or to protect borrowers, including, but not limited to, laws pertaining to licenses, unfair competition, usury, and conflicts of interest. (Amended by Stats. 2009, Ch. 103, Sec. 1. (AB 401) Effective January 1, 2010.)
  106. 22065.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    Certain exempt persons may apply for exempt company registration, and applicants must follow commissioner rules and pay an annual fee.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22065. (a) Persons not subject to this division may apply to the commissioner for an exempt company registration for the purpose of sponsoring one or more individuals required to be licensed as mortgage loan originators pursuant to the federal SAFE Act. (b) An exempt person applying under the exempt company registration procedure shall comply with all rules and orders that the commissioner deems necessary to ensure compliance with the federal SAFE Act and shall pay an annual registration fee established by the commissioner. (c) (1) A mortgage loan originator who is an insurance producer eligible for licensure pursuant to this section shall meet all of the following requirements: (A) Be covered under an exclusive written contract with, and originate mortgage loans solely on behalf of, that exempt person. (B) Hold a current insurance producer license under Article 3 (commencing with Section 1631) of Chapter 5 of Part 2 of Division 1 of the Insurance Code that is not suspended or revoked. (C) Have a current notice of appointment under Article 9 (commencing with Section 1702) of Chapter 5 of Part 2 of Division 1 of the Insurance Code from an insurer that controls, is controlled by, or is under common control with that exempt person. (2) A licensed mortgage loan originator who is an insurance producer for an insurer authorized to do business in this state may originate loans on behalf of a person registered pursuant to subdivision (a) or on behalf of a licensed finance lender that originates loans exclusively for a single person that is not subject to licensure pursuant to subdivision (a) of Section 22050. (Amended by Stats. 2012, Ch. 264, Sec. 3. (AB 2666) Effective January 1, 2013.)
  107. 22066.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    This section exempts certain nonprofit organizations involved in qualifying small-dollar loans, but only if they meet listed conditions and follow reporting, disclosure, underwriting, and other loan rules.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22066. (a) The Legislature finds and declares that nonprofit organizations have an important role to play in helping individuals obtain access to affordable, credit-building small dollar loans. California law should refrain from creating statutory barriers that risk slowing the growth of these loans. This section shall be liberally construed to encourage nonprofit organizations to help facilitate the making of zero-interest, low-cost loans, through lending circles and other programs and services that allow individuals to establish and build credit histories or to improve their credit scores. (b) For the purposes of this section, an organization described in subdivision (c) shall be known as an exempt organization, and an organization described in subdivision (d) shall be known as a partnering organization. (c) There shall be exempted from this division a nonprofit organization that facilitates one or more zero-interest, low-cost loans, provided all of the following conditions are met: (1) The organization is exempt from federal income taxes under Section 501(c)(3) of the Internal Revenue Code and is organized and operated exclusively for one or more of the purposes described in Section 501(c)(3) of the Internal Revenue Code. (2) No part of the net earnings of the organization inures to the benefit of a private shareholder or individual. (3) A broker’s fee is not paid in connection with the making of the loan that is facilitated by the organization. (4) An organization wishing to operate pursuant to an exemption granted under this section shall file an application for exemption with the commissioner, in a manner prescribed by the commissioner, and shall pay a fee to the commissioner, in an amount calculated by the commissioner to cover his or her costs to administer this section and Section 22067. The commissioner may refuse to grant an exemption, or to suspend or revoke a previously issued exemption if he or she finds that one or more of the provisions of this section were not met or are not being met by the organization and that denial, suspension, or revocation of the exemption is in the best interests of the public. (5) Every organization whose exemption is approved by the commissioner shall file an annual report with the commissioner on or before March 15 of each year, containing relevant information that the commissioner reasonably requires concerning lending facilitated by the organization within the state during the preceding calendar year at all locations at which the organization facilitates lending. The commissioner shall compile the information submitted pursuant to this paragraph for use in preparing the report required by Section 22067. (6) Any loan made pursuant to this section shall comply with the following requirements: (A) The loan shall be unsecured. (B) Interest shall not be imposed. (C) An administrative fee may be charged in an amount not to exceed the following: (i) Seven percent of the principal amount, exclusive of the administrative fee, or ninety dollars ($90), whichever is less, on the first loan made to a borrower. (ii) Six percent of the principal amount, exclusive of the administrative fee, or seventy-five dollars ($75), whichever is less, on the second and subsequent loans made to that borrower. (D) An organization shall not charge the same borrower an administrative fee more than once in any four-month period. Each administrative fee shall be fully earned immediately upon consummation of a loan agreement. (E) Notwithstanding subdivision (a) of Section 22320.5 and in lieu of any other type of delinquency fee or late fee, an organization may require reimbursement from a borrower of up to ten dollars ($10) to cover an insufficient funds fee incurred by that organization due to actions of the borrower. An organization shall not charge more than two insufficient funds fees to the same borrower in a single month. (F) The following information shall be disclosed to the consumer in writing, in a typeface no smaller than 12-point type, at the time of the loan application: (i) The amount to be borrowed, the total dollar cost of the loan to the consumer if the loan is paid back on time, including the sum of the administrative fee and principal amount borrowed, the corresponding annual percentage rate, calculated in accordance with Federal Reserve Board Regulation Z (12 C.F.R. 226.1), the periodic payment amount, the payment frequency, and the insufficient funds fee, if applicable. (ii) An explanation of whether, and under what circumstances, a borrower may exit a loan agreement. (G) The loan shall have a minimum principal amount upon origination of two hundred fifty dollars ($250) and a maximum principal amount upon origination of two thousand five hundred dollars ($2,500), and a term of not less than the following: (i) Ninety days for loans whose principal balance upon origination is less than five hundred dollars ($500). (ii) One hundred twenty days for loans whose principal balance upon origination is at least five hundred dollars ($500), but is less than one thousand five hundred dollars ($1,500). (iii) One hundred eighty days for loans whose principal balance upon origination is at least one thousand five hundred dollars ($1,500). (H) The loan shall not be refinanced. (I) The organization or any of its wholly owned subsidiaries shall not sell or assign unpaid debt to an independent party for collection before at least 90 days have passed since the start of the delinquency. (7) Prior to disbursement of loan proceeds, the organization shall either (A) offer a credit education program or seminar to the borrower that has been previously reviewed and approved by the commissioner for use in complying with this section, or (B) invite the borrower to a credit education program or seminar offered by an independent third party that has been previously reviewed and approved by the commissioner for use in complying with this section. A credit education program or seminar offered pursuant to this paragraph shall be provided at no cost to the borrower. (8) The organization shall report each borrower’s payment performance to at least one consumer reporting agency that compiles and maintains files on consumers on a nationwide basis, upon acceptance as a data furnisher by that consumer reporting agency. For purposes of this section, a consumer reporting agency that compiles and maintains files on consumers on a nationwide basis is one that meets the definition in Section 603(p) of the federal Fair Credit Reporting Act (15 U.S.C. Sec. 1681a(p)). An organization that is accepted as a data furnisher after being granted an exemption by the commissioner pursuant to this subdivision shall report all borrower payment performance since its inception of lending under the program, as soon as practicable after its acceptance into the program, but in no event more than six months after its acceptance into the program. (9) The organization shall underwrite each loan and shall ensure that a loan is not made if, through its underwriting, the organization determines that the borrower’s total monthly debt service payments, at the time of loan origination, including the loan for which the borrower is being considered, and across all outstanding forms of credit that can be independently verified by the organization, exceed 50 percent of the borrower’s gross monthly household income except as specified in clause (iii) of subparagraph (D). (A) The organization shall seek information and documentation pertaining to all of a borrower’s outstanding debt obligations during the loan application and underwriting process, including loans that are self-reported by the borrower but not available through independent verification. The organization shall verify that information using a credit report from at least one consumer reporting agency that compiles and maintains files on consumers on a nationwide basis or through other available electronic debt verification services that provide reliable evidence of a borrower’s outstanding debt obligations. (B) The organization shall also request from the borrower and include all information obtained from the borrower regarding outstanding deferred deposit transactions in the calculation of the borrower’s outstanding debt obligations. (C) The organization shall not be required to consider, for purposes of debt-to-income ratio evaluation, loans from friends or family. (D) The organization shall also verify the borrower’s household income that the organization relies on to determine the borrower’s debt-to-income ratio using information from any of the following: (i) Electronic means or services that provide reliable evidence of the borrower’s actual income. (ii) Internal Revenue Service Form W-2, tax returns, payroll receipts, bank statements, or other third-party documents that provide reasonably reliable evidence of the borrower’s actual income. (iii) A signed statement from the borrower stating sources and amounts of income, if the borrower’s actual income cannot be independently verified using electronic means or services, Internal Revenue Service forms, tax returns, payroll receipts, bank statements, or other third-party documents. If income is verified using a signed statement from a borrower, a loan shall not be made if the borrower’s total monthly debt service payments, at the time of loan origination, including the loan for which the borrower is being considered, and across all outstanding forms of credit, exceed 25 percent of the borrower’s gross monthly household income. (10) The organization shall notify each borrower, at least two days prior to each payment due date, informing the borrower of the amount due and the payment due date. Notification may be provided by any means mutually acceptable to the borrower and the organization. A borrower shall have the right to opt out of this notification at any time, upon electronic or written request to the organization. The organization shall notify each borrower of this right prior to disbursing loan proceeds. (11) Notwithstanding Sections 22311 to 22315, inclusive, no organization, in connection with, or incidental to, the facilitating of any loan made pursuant to this section, may offer, sell, or require a borrower to contract for “credit insurance” as defined in paragraph (1) of subdivision (a) of Section 22314 or insurance on tangible personal or real property of the type specified in Section 22313. (12) An organization shall not require, as a condition of making a loan, that a borrower waive any right, penalty, remedy, forum, or procedure provided for in any law applicable to the loan, including the right to file and pursue a civil action or file a complaint with or otherwise communicate with the commissioner or any court or other public entity, or that the borrower agree to resolve disputes in a jurisdiction outside of California or to the application of laws other than those of California, as provided by law. Any waiver by a borrower must be knowing, voluntary, and in writing, and expressly not made a condition of doing business with the organization. Any waiver that is required as a condition of doing business with the organization shall be presumed involuntary, unconscionable, against public policy, and unenforceable. The organization has the burden of proving that a waiver of any rights, penalties, forums, or procedures was knowing, voluntary, and not made a condition of the contract with the borrower. (13) An organization shall not refuse to do business with or discriminate against a borrower or applicant on the basis that the borrower or applicant refuses to waive any right, penalty, remedy, forum, or procedure, including the right to file and pursue a civil action or complaint with, or otherwise notify, the commissioner or any court or other public entity. The exercise of a person’s right to refuse to waive any right, penalty, remedy, forum, or procedure, including a rejection of a contract requiring a waiver, shall not affect any otherwise legal terms of a contract or an agreement. (14) This section does not apply to any agreement to waive any right, penalty, remedy, forum, or procedure, including any agreement to arbitrate a claim or dispute, after a claim or dispute has arisen. This section does not affect the enforceability or validity of any other provision of the contract. (d) This division does not apply to a nonprofit organization that partners with an organization granted an exemption pursuant to subdivision (c) for the purpose of facilitating zero-interest, low-cost loans, provided that the requirements of paragraphs (6) to (14), inclusive, of subdivision (c), and the following additional conditions are met: (1) The partnership of each exempt organization and each partnering organization shall be formalized through a written agreement that specifies the obligations of each party. Each written agreement shall contain a provision establishing that the partnering organization agrees to comply with the provisions of this section and any regulations that may be adopted by the commissioner pursuant to this section. Each written agreement shall be provided to the commissioner upon request. (2) Each partnering organization shall meet the requirements for federal income tax exemption under Section 501(c)(3) of the Internal Revenue Code and shall be organized and operated exclusively for one or more of the purposes described in Section 501(c)(3) of the Internal Revenue Code. (3) No part of the net earnings of the partnering organization shall inure to the benefit of a private shareholder or individual. (4) Each exempt organization shall notify the commissioner within 30 days of entering into a written agreement with a partnering organization, on such form and in such manner as the commissioner may prescribe. At a minimum, this notification shall include the name of the partnering organization, the contact information for a person responsible for the lending activities facilitated by that partnering organization, and the address or addresses at which the organization facilitates lending activities. (5) Upon a determination that a partnering organization has acted in violation of this section or any regulation adopted thereunder, the commissioner may disqualify that partnering organization from performing services under this section, bar that organization from performing services at one or more specific locations of that organization, terminate a written agreement between a partnering organization and an exempt organization, and, if the commissioner deems such action to be in the public interest, prohibit the use of that partnering organization by all organizations granted exemptions by the commissioner pursuant to subdivision (c). (6) The exempt organization shall include information regarding the loans facilitated by the partnering organization in the annual report required pursuant to paragraph (5) of subdivision (c). (e) The commissioner may examine each exempt organization and each partnering organization for compliance with the provisions of this section, upon reasonable notice to the party responsible for the lending activities facilitated by that organization. An organization so examined shall make available to the commissioner or his or her representative all books and records requested by the commissioner related to the lending activities facilitated by that organization. The cost of the examination shall be paid by the exempt organization. (f) This section does not apply to any loan of a bona fide principal amount of two thousand five hundred dollars ($2,500) or more as determined in accordance with Section 22251. For purposes of this subdivision, “bona fide principal amount” shall be determined in accordance with Section 22251. (Amended by Stats. 2015, Ch. 303, Sec. 156. (AB 731) Effective January 1, 2016.)
  108. 22067.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    The commissioner must post an annual report on the department’s website by July 1, and the report must cover the specified information in subdivision (b).

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22067. (a) On or before July 1 of each year, the commissioner shall post a report on the department’s internet website summarizing the information described in subdivision (b). The information disclosed to the commissioner for the commissioner’s use in preparing the report described in this section is exempted from any requirement of public disclosure by subdivision (b) of Section 7929.000 of the Government Code. (b) The report required by this section shall specify the time period to which the report corresponds, and shall include, but not be limited to, the following for that time period: (1) The number of organizations that applied for exemptions pursuant to subdivision (c) of Section 22066, and the number of organizations that entered into partnerships with exempt organizations in accordance with subdivision (d) of Section 22066. (2) The number of organizations granted exemptions and the types of exemptions granted. (3) The reason or reasons for denying applications for exemptions, if applicable. This information shall be provided in a manner that does not identify the entity or entities denied. (4) The number of borrowers who applied for loans through exempt or partnering organizations, the number of borrowers granted loans facilitated by exempt or partnering organizations, the total amount loaned, and the distribution of loan lengths upon origination. (5) The number of borrowers who obtained more than one loan through an exempt or partnering organization and the distribution of the number of loans per borrower. (6) Of the number of borrowers who obtained more than one loan facilitated by an exempt or a partnering organization, the percentage of those borrowers whose credit scores increased between successive loans, based on information from at least one major credit bureau, and the average size of the increase. (7) The income distribution of borrowers upon loan origination, including the number of borrowers who obtained at least one loan and who resided in a low-to-moderate-income census tract at the time of their loan application. (8) The number of borrowers who obtained loans facilitated by an exempt or a partnering organization for the following purposes, based on borrower responses at the time of their loan applications indicating the primary purpose for which the loan was obtained: (A) Medical. (B) Other emergency. (C) Vehicle repair. (D) Vehicle purchase. (E) To pay bills. (F) To consolidate debt. (G) To build or repair credit history. (H) To finance a purchase of goods or services other than a vehicle. (I) For other than personal, family, or household purposes. (J) Other. (9) The number of borrowers who self-report that they had a bank account at the time of their loan application, the number of borrowers who self-report that they had a bank account and used check-cashing services, and the number of borrowers who self-report that they did not have a bank account at the time of their loan application. (10) The performance of loans under Section 22066, as reflected by all of the following: (A) The number and percentage of borrowers who experienced at least one late payment lasting between 7 and 29 days and who subsequently brought the loan current, and the distribution of principal loan amounts corresponding to those late payments. (B) The number and percentage of borrowers who experienced at least one late payment lasting between 30 and 59 days and who subsequently brought the loan current, and the distribution of principal loan amounts corresponding to those late payments. (C) The number and percentage of borrowers who experienced at least one late payment lasting 60 days or more and who subsequently brought the loan current, and the distribution of principal loan amounts corresponding to those late payments. (D) The number and percentage of borrowers who experienced at least one late payment of greater than seven days and who did not subsequently bring the loan current. (E) Among loans that were ever late for seven days or more, the average number of times borrowers experienced a late payment of seven days or more. (11) The number and types of violations of Section 22066 by exempt organizations, which were documented by the commissioner. (12) The number and types of violations of Section 22066 by partnering organizations, which were documented by the commissioner. (13) The number of times the commissioner suspended or revoked an exemption granted to an exempt organization pursuant to paragraph (4) of subdivision (c) of Section 22066 and the number of times a partnering organization was sanctioned by the commissioner pursuant to paragraph (5) of subdivision (d) of Section 22066. (14) The number of complaints received by the commissioner about an exempt organization or a partnering organization, and the nature of those complaints. (15) Recommendations, if any, for improving the program. (Amended by Stats. 2021, Ch. 615, Sec. 111. (AB 474) Effective January 1, 2022. Operative January 1, 2023, pursuant to Sec. 463 of Stats. 2021, Ch. 615.)
  109. 22068.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    The article’s exemptions and exclusions do not apply to a person acting as a program administrator or a PACE solicitor.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22050 - 22068] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22068. (a) The exemptions and exclusions in this article are not applicable to a person engaged in business as a program administrator or a PACE solicitor. (b) This section shall become operative on January 1, 2019. (Added by Stats. 2017, Ch. 475, Sec. 19. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  110. 22100.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    This section requires licenses and registration for finance lending and mortgage loan originator activity, and it bars certain lending or employment practices unless the licensing rules are met.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22100. (a) No person shall engage in the business of a finance lender or broker without obtaining a license from the commissioner. (b) Every licensee engaging in the business of making or brokering residential mortgage loans shall require that every mortgage loan originator employed or compensated by that licensee obtains and maintains a mortgage loan originator license from the commissioner under this division or Division 20 (commencing with Section 50000), or has first obtained a license endorsement from the Commissioner of Real Estate pursuant to Article 2.1 (commencing with Section 10166.01) of Chapter 3 of Part 1 of Division 4 of the Business and Professions Code. (c) A finance lender or broker shall not employ a mortgage loan originator whose license or license endorsement has lapsed. (d) A finance lender or broker may not make or broker a residential mortgage loan unless that loan is offered by, negotiated by, or applied for through a licensed mortgage loan originator. (e) Every licensee engaged in the business of making or brokering residential mortgage loans and every mortgage loan originator licensed under this division shall register with and maintain a valid unique identifier issued by the Nationwide Mortgage Licensing System and Registry. (f) An individual shall not engage in the business of a mortgage loan originator with respect to any dwelling located in this state without first obtaining and maintaining annually a license in accordance with the requirements of this division and any rules promulgated by the commissioner under this chapter. (g) A registered mortgage loan originator, as defined in subdivision (c) of Section 22013, is exempt from licensure under this section when he or she is employed by: (1) A depository institution. (2) A subsidiary of a depository institution that is owned and controlled by a depository institution and regulated by a federal banking agency. (3) An institution regulated by the Farm Credit Administration. (Amended by Stats. 2012, Ch. 264, Sec. 4. (AB 2666) Effective January 1, 2013.)
  111. 22100.5.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A person may not run a program administrator business without first getting a license from the commissioner.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22100.5. (a) A person shall not engage in the business of a program administrator without obtaining a license from the commissioner. (b) This section shall become operative on January 1, 2019. (Added by Stats. 2017, Ch. 475, Sec. 20. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  112. 22101.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    License applicants must use the required form, pay the fee, and some applicants must submit fingerprints; the commissioner can also require electronic filing methods and related materials.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22101. (a) An application for a license as a finance lender, broker, or program administrator under this division shall be in the form and contain the information that the commissioner may by rule or order require and shall be filed upon payment of the fee specified in Section 22103. (b) Notwithstanding any other law, an applicant who does not currently hold a license as a finance lender, broker, or program administrator under this division shall furnish, with their application, a full set of fingerprints and related information for purposes of the commissioner conducting a criminal history record check. The commissioner shall obtain and receive criminal history information from the Department of Justice and the Federal Bureau of Investigation pursuant to Section 22101.5. (c) This section does not prevent a licensee from engaging in the business of a finance lender or program administrator through a subsidiary corporation if the subsidiary corporation is licensed pursuant to this division. (d) For purposes of this section, “subsidiary corporation” means a corporation that is wholly owned by a licensee. (e) A new application shall not be required for a change in the address of an existing location previously licensed under this division. However, the licensee shall comply with the requirements of Section 22153. (f) Notwithstanding subdivisions (a) to (e), inclusive, the commissioner may by rule require an application to be made through the Nationwide Mortgage Licensing System and Registry, and may require fees, fingerprints, financial statements, supporting documents, changes of address, and any other information, and amendments or modifications thereto, to be submitted in the same manner. (g) Notwithstanding any other law, the commissioner may by rule or order prescribe circumstances under which to accept electronic records or electronic signatures. This section does not require the commissioner to accept electronic records or electronic signatures. (h) For purposes of this section, the following terms have the following meanings: (1) “Electronic record” means an initial license application, or material modification of that license application, and any other record created, generated, sent, communicated, received, or stored by electronic means. “Electronic records” also includes, but is not limited to, all of the following: (A) An application, amendment, supplement, and exhibit, filed for any license, consent, or other authority. (B) A financial statement, a report, or advertising. (C) An order, license, consent, or other authority. (D) A notice of public hearing, accusation, and statement of issues in connection with any application, license, consent, or other authority. (E) A proposed decision of a hearing officer and a decision of the commissioner. (F) The transcripts of a hearing and correspondence between a party and the commissioner directly relating to the record. (G) A release, newsletter, interpretive opinion, determination, or specific ruling. (H) Correspondence between a party and the commissioner directly relating to any document listed in subparagraphs (A) to (G), inclusive. (2) “Electronic signature” means an electronic sound, symbol, or process attached to or logically associated with an electronic record and executed or adopted by a person with the intent to sign the electronic record. (i) The Legislature finds and declares that the Department of Financial Protection and Innovation has continuously implemented methods to accept records filed electronically, and is encouraged to continue to expand its use of electronic filings to the extent feasible, as budget, resources, and equipment are made available to accomplish that goal. (j) This section shall become operative on January 1, 2019. (Amended by Stats. 2022, Ch. 452, Sec. 133. (SB 1498) Effective January 1, 2023.)
  113. 22101.5.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    The commissioner must send fingerprint information for certain finance license candidates to the Department of Justice, and the Department of Justice must process, forward, review, and respond to the request. The commissioner may also require fingerprints to be sent to the Nationwide Mortgage Licensing System and Registry.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22101.5. (a) The commissioner shall submit to the Department of Justice fingerprint images and related information required by the Department of Justice of all finance lender, broker, or program administrator license candidates, as defined by subdivision (a) of Section 22101, for purposes of obtaining information as to the existence and content of a record of state or federal convictions, state or federal arrests, and information as to the existence and content of a record of state or federal arrests for which the Department of Justice establishes that the person is free on bail or on his or her own recognizance pending trial or appeal. (b) When received, the Department of Justice shall forward to the Federal Bureau of Investigation requests for federal summary criminal history information received pursuant to this section. The Department of Justice shall review the information returned from the Federal Bureau of Investigation and compile and disseminate a response to the commissioner. (c) The Department of Justice shall provide a response to the commissioner pursuant to paragraph (1) of subdivision (p) of Section 11105 of the Penal Code. (d) The commissioner shall request from the Department of Justice subsequent arrest notification service, as provided pursuant to Section 11105.2 of the Penal Code, for license candidates described in subdivision (a). (e) The Department of Justice shall charge a fee sufficient to cover the costs of processing the requests pursuant to this section. (f) Notwithstanding subdivisions (a) to (e), inclusive, the commissioner may by rule require fingerprints submitted by an applicant to be submitted to the Nationwide Mortgage Licensing System and Registry in addition to the Department of Justice. (g) This section shall become operative on January 1, 2019. (Repealed (in Sec. 23) and added by Stats. 2017, Ch. 475, Sec. 24. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  114. 22102.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    Licensees who want to do business at a new location must apply for a branch office license at least 10 days in advance, pay the required fee, and follow the commissioner’s approval process.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22102. (a) A finance lender, broker, or program administrator licensee seeking to engage in business at a new location shall submit an application for a branch office license to the commissioner at least 10 days before engaging in business at a new location and pay the fee required by Section 22103. The commissioner may require an applicant seeking to engage in business at a new location to submit its application, or parts thereof, through the Nationwide Mortgage Licensing System and Registry. (b) The licensee may engage in business at the new location 10 days after the date of submission of a branch office application. (c) (1) The commissioner shall approve or deny the person responsible for the lending activity at the new location in accordance with Section 22109, and shall notify the licensee of this decision within 90 days of the date of receipt of the application. (2) If the commissioner denies the application, the licensee shall, within 10 days of the date of receipt of notification of the commissioner’s denial, submit a new application to the commissioner designating a different person responsible for the lending activity at the new location. The commissioner shall approve or deny the different person as provided in paragraph (1). (d) A licensee shall not engage in business at a new location in a name other than a name approved by the commissioner. (e) The commissioner may adopt regulations to implement the requirements of this section. (f) A branch office license to engage in business at a new location shall be issued in accordance with this section. A change of street address of a place of business designated in a license shall be made in accordance with Section 22153 and shall not constitute a new location subject to the requirements of this section. (g) This section shall become operative on January 1, 2019. (Repealed (in Sec. 25) and added by Stats. 2017, Ch. 475, Sec. 26. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  115. 22103.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    Applicants for certain finance-related licenses must pay filing-time fees to the commissioner, and the fees are not refundable if the application is denied or withdrawn.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22103. (a) At the time of filing the application for a finance lender, broker, program administrator, or branch office license, the applicant shall pay to the commissioner the sum of one hundred dollars ($100) as a fee for investigating the application, plus the cost of fingerprint processing and the criminal history record check under Section 22101.5, and two hundred dollars ($200) as an application fee. The investigation fee, including the amount for the criminal history record check, and the application fee are not refundable if an application is denied or withdrawn. (b) This section shall become operative on January 1, 2019. (Repealed (in Sec. 27) and added by Stats. 2017, Ch. 475, Sec. 28. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  116. 22104.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    Applicants and licensees must meet net worth requirements, and certain lenders or brokers must keep higher minimum net worth levels.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22104. (a) The applicant shall file with the application for a finance lender, broker, or program administrator license financial statements prepared in accordance with generally accepted accounting principles and acceptable to the commissioner that indicate a net worth of at least twenty-five thousand dollars ($25,000). Except as provided in subdivisions (b) and (c), a licensee shall maintain a net worth of at least twenty-five thousand dollars ($25,000) at all times. (b) A licensed finance lender or broker, that employs one or more mortgage loan originators and that makes residential mortgage loans, shall continuously maintain a minimum net worth of at least two hundred fifty thousand dollars ($250,000). (c) A licensed finance broker, that employs one or more mortgage loan originators and that arranges, but does not make, residential mortgage loans, shall continuously maintain a minimum net worth of at least fifty thousand dollars ($50,000). (d) The commissioner may promulgate rules or regulations with respect to the requirements for minimum net worth, as are necessary to accomplish the purposes of this division and comply with the SAFE Act. (e) This section shall become operative on January 1, 2019. (Repealed (in Sec. 29) and added by Stats. 2017, Ch. 475, Sec. 30. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  117. 22105.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    The commissioner must investigate certain applicants and related persons when an application is filed and fees are paid, and must issue a license if the applicant satisfies the division and there are no denial facts under Section 22109.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22105. (a) Upon the filing of an application pursuant to Section 22101 and the payment of the fees, the commissioner shall investigate the applicant and its general partners and persons owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or any person responsible for the conduct of the applicant’s lending or program administration activities in this state, if the applicant is a partnership. If the applicant is a corporation, trust, limited liability company, or association, including an unincorporated organization, the commissioner shall investigate the applicant, its principal officers, directors, managing members, and persons owning or controlling, directly or indirectly, 10 percent or more of the outstanding equity securities or any person responsible for the conduct of the applicant’s lending activities or for administering PACE programs for the applicant in this state. Upon the filing of an application pursuant to Section 22102 and the payment of the fees, the commissioner shall investigate the person responsible for the lending activity of the licensee, or for administering one or more PACE programs for the licensee, at the new location described in the application. The investigation may be limited to information that was not included in prior applications filed pursuant to this division. If the commissioner determines that the applicant has satisfied this division and does not find facts constituting reasons for denial under Section 22109, the commissioner shall issue and deliver a license to the applicant. (b) For the purposes of this section, “principal officers” shall mean president, chief executive officer, treasurer, and chief financial officer, as may be applicable, and any other officer with direct responsibility for the conduct of the applicant’s lending activities or for PACE program administration for the applicant within the state. (c) This section shall become operative on January 1, 2019. (Amended (as added by Stats. 2017, Ch. 475, Sec. 32) by Stats. 2018, Ch. 813, Sec. 3. (AB 2063) Effective January 1, 2019.)
  118. 22105.1.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    Mortgage loan originator applicants must use the prescribed uniform form and provide required identity/background information; the commissioner and the Department of Justice have related information-sharing powers and duties.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22105.1. (a) An applicant for a mortgage loan originator license shall apply by submitting the uniform form prescribed for such purpose by the Nationwide Mortgage Licensing System and Registry. The commissioner may require the submission of additional information or supporting documentation to the department. (b) Section 461 of the Business and Professions Code shall not be applicable to the Department of Financial Protection and Innovation when using a national uniform application adopted or approved for use by the Nationwide Mortgage Licensing System and Registry in connection with the SAFE Act. (c) In connection with an application for a license as a mortgage loan originator, the applicant shall, at a minimum, furnish to the Nationwide Mortgage Licensing System and Registry information concerning the applicant’s identity, including the following: (1) Fingerprint images and related information, for purposes of performing a federal, or both a state and federal, criminal history background check. (2) Personal history and experience in a form prescribed by the Nationwide Mortgage Licensing System and Registry, including the submission of authorization for the Nationwide Mortgage Licensing System and Registry and the commissioner to obtain both of the following: (A) An independent credit report obtained from a consumer reporting agency. (B) Information related to any administrative, civil, or criminal findings by any governmental jurisdiction. (d) The commissioner may ask the Nationwide Mortgage Licensing System and Registry to obtain state criminal history background check information on applicants described in subdivision (a) using the procedures set forth in subdivisions (e) and (f). (e) If the Nationwide Mortgage Licensing System and Registry electronically submits fingerprint images and related information, as required by the Department of Justice, for an applicant for a mortgage loan originator license, for the purposes of obtaining information as to the existence and content of a record of state convictions and state arrests and to the existence and content of a record of state arrests for which the Department of Justice establishes that the person is free on bail or on their recognizance pending trial or appeal, the Department of Justice shall provide an electronic response to the Nationwide Mortgage Licensing System and Registry pursuant to paragraph (1) of subdivision (p) of Section 11105 of the Penal Code, and shall provide the same electronic response to the commissioner. (f) The Nationwide Mortgage Licensing System and Registry may request from the Department of Justice subsequent arrest notification service, as provided pursuant to Section 11105.2 of the Penal Code, for persons described in subdivision (a). The Department of Justice shall provide the same electronic response to the commissioner. (g) The Department of Justice shall charge a fee sufficient to cover the cost of processing the requests described in this section. (Amended by Stats. 2022, Ch. 452, Sec. 134. (SB 1498) Effective January 1, 2023.)
  119. 22105.2.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    The commissioner may use and adjust the Nationwide Mortgage Licensing System and Registry for licensing-related record and information handling, and must set up a process for applicants and licensees to challenge commissioner-entered information.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22105.2. (a) The commissioner is authorized to establish relationships or contracts with the Nationwide Mortgage Licensing System and Registry or other entities designated by the Nationwide Mortgage Licensing System and Registry to collect and maintain records and process transaction fees or other fees related to licensees or other persons subject to this division. (b) For the purpose of participating in the Nationwide Mortgage Licensing System and Registry, the commissioner is authorized to waive or modify, in whole or in part, by rule, regulation, or order, any or all of the requirements of this division and to establish new requirements as reasonably necessary to participate in the Nationwide Mortgage Licensing System and Registry. (c) The commissioner may use the Nationwide Mortgage Licensing System and Registry as a channeling agent for requesting information from, and distributing information to, the Department of Justice or any governmental agency. (d) The commissioner may use the Nationwide Mortgage Licensing System and Registry as a channeling agent for requesting and distributing information to and from any source so directed by the commissioner. (e) The commissioner shall establish a process where applicants and licensees may challenge information entered into the Nationwide Mortgage Licensing System and Registry by the commissioner. (Added by Stats. 2009, Ch. 160, Sec. 19. (SB 36) Effective October 11, 2009.)
  120. 22105.3.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    This section keeps certain information confidential after disclosure to the Nationwide Mortgage Licensing System and Registry, limits public disclosure and related evidence use, and lets the commissioner make sharing agreements with specified agencies and associations.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22105.3. (a) Except as otherwise provided in Section 1512 of the SAFE Act, the requirements under any federal or state law regarding the privacy or confidentiality of any information or material provided to the Nationwide Mortgage Licensing System and Registry, and any privilege arising under federal or state law, including the rules of any federal or state court, with respect to that information or material, shall continue to apply to the information or material after the information or material has been disclosed to the Nationwide Mortgage Licensing System and Registry. The information and material may be shared with all state and federal regulatory officials with applicable oversight authority without the loss of privilege or the loss of confidentiality protections provided by federal or state law. (b) For these purposes, the commissioner is authorized to enter agreements or share arrangements with other governmental agencies, the Conference of State Bank Supervisors, the American Association of Residential Mortgage Regulators, or other associations representing governmental agencies as established by rule, regulation, or order of the commissioner. (c) Information or material that is subject to a privilege or confidentiality under subdivision (a) shall not be subject to the following: (1) Disclosure under any federal or state law governing the disclosure to the public of information held by an officer or an agency of the federal government or the state. (2) Subpoena or discovery, or admission into evidence, in any private civil action or administrative process, unless with respect to any privilege held by the Nationwide Mortgage Licensing System and Registry with respect to the information or material, the person to whom the information or material pertains waives, in whole or in part, in the discretion of the person, that privilege. (3) This section shall not apply with respect to the information or material relating to the employment history of, and publicly adjudicated disciplinary and enforcement actions against, mortgage loan originators that is included in the Nationwide Mortgage Licensing System and Registry for access by the public. (d) This section shall become operative on January 1, 2019. (Repealed (in Sec. 33) and added by Stats. 2017, Ch. 475, Sec. 34. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  121. 22105.4.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    The commissioner must regularly report violations, enforcement actions, and other relevant public-record information to the Nationwide Mortgage Licensing System and Registry.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22105.4. The commissioner shall regularly report violations of this division, as well as enforcement actions and other relevant information, to the Nationwide Mortgage Licensing System and Registry, to the extent that information is public record. (Added by Stats. 2009, Ch. 160, Sec. 21. (SB 36) Effective October 11, 2009.)
  122. 22106.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    This section says what information must appear on certain finance lender, broker, or program administrator licenses, and it sets requirements for out-of-state business locations.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22106. (a) The finance lender, broker, or program administrator license shall state the name of the licensee, and if the licensee is a partnership, the names of its general partners, and if a corporation or an association, the date and place of its incorporation or organization, and the address of the licensee’s principal business location. On the approval and licensing of a location pursuant to Section 22101 or 22102, the commissioner shall issue an original license endorsed to show the address of the authorized location and, if applicable, the name of the subsidiary corporation licensed to operate the location. The license shall state whether the licensee is licensed as a finance lender, broker, or program administrator. (b) (1) An application for a license for a business location outside this state shall constitute an agreement by the applicant to do all of the following: (A) Make the licensee’s books, accounts, papers, records, and files available to the commissioner or the commissioner’s representatives in this state. (B) Pay the reasonable expenses for travel, meals, and lodging of the commissioner or the commissioner’s representatives incurred during any investigation or examination made at the licensee’s location outside this state. (2) A licensee located outside this state is not required to maintain books and records regarding licensed loans separate from those for other loans if the licensed loans can be readily identified. (c) This section shall become operative on January 1, 2019. (Repealed (in Sec. 35) and added by Stats. 2017, Ch. 475, Sec. 36. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  123. 22107.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    Licensees must pay annual assessments and late-payment penalties, and the commissioner may suspend or revoke certificates for nonpayment.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22107. (a) Each finance lender, broker, or program administrator licensee shall pay to the commissioner its pro rata share of all costs and expenses, including the costs and expenses associated with the licensing of mortgage loan originators it employs, reasonably incurred in the administration of this division, as estimated by the commissioner, for the ensuing year and any deficit actually incurred or anticipated in the administration of the program in the year in which the assessment is made. The pro rata share shall be the proportion that a licensee’s gross income bears to the aggregate gross income of all licensees as shown by the annual financial reports to the commissioner, for the costs and expenses remaining after the amount assessed pursuant to subdivision (c). (b) On or before September 30th in each year, the commissioner shall notify each licensee of the amount assessed and levied against it and that amount shall be paid by October 31. If payment is not made by October 31, the commissioner shall assess and collect a penalty, in addition to the assessment, of 1 percent of the assessment for each month or part of a month that the payment is delayed or withheld. (c) In the levying and collection of the assessment, a licensee shall neither be assessed for nor be permitted to pay less than two hundred fifty dollars ($250) per licensed location per year. (d) If a licensee fails to pay the assessment on or before the October 31st, the commissioner may by order summarily suspend or revoke the certificate issued to the licensee. If, after an order is made, a request for a hearing is filed in writing within 30 days, and a hearing is not held within 60 days thereafter, the order is deemed rescinded as of its effective date. During any period when its certificate is revoked or suspended, a finance lender, broker, or program administrator licensee and any mortgage loan originator licensee employed by the finance lender or broker shall not conduct business pursuant to this division except as may be permitted by order of the commissioner. However, the revocation, suspension, or surrender of a certificate shall not affect the powers of the commissioner as provided in this division. (e) The commissioner shall, by rule, establish the timelines, fees, and assessments applicable to applicants for original mortgage loan originator licenses, license renewals, and license changes under this division. (f) Notwithstanding subdivisions (a) to (e), inclusive, the commissioner may by rule require licensees to pay assessments through the Nationwide Mortgage Licensing System and Registry. (g) This section shall become operative on January 1, 2019. (Repealed (in Sec. 37) and added by Stats. 2017, Ch. 475, Sec. 38. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  124. 22108.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    The commissioner may adopt rules requiring licensees to file specified information, including updates to application information and filings through the Nationwide Mortgage Licensing System and Registry.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22108. (a) The commissioner may by rule require licensees to file, at the times that he or she may specify, the information that he or she may reasonably require regarding any changes in the information provided in any application filed pursuant to this division. (b) The commissioner may by rule require a licensee to file information through the Nationwide Mortgage Licensing System and Registry. (Amended by Stats. 2009, Ch. 160, Sec. 23.5. (SB 36) Effective October 11, 2009.)
  125. 22109.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    The commissioner may deny certain finance lender, broker, or program administrator license applications for listed reasons, and must act within 60 days on a complete application; applicants must respond to deficiency notices within 90 days or the application is treated as withdrawn.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22109. (a) Upon reasonable notice and opportunity to be heard, the commissioner may deny the application for a finance lender, broker, or program administrator license for any of the following reasons: (1) A false statement of a material fact has been made in the application. (2) The applicant or an officer, director, general partner, person responsible for the applicant’s lending activities or administering PACE programs for the applicant in this state, or person owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant has, within the last 10 years, been convicted of or pleaded nolo contendere to a crime, or committed an act involving dishonesty, fraud, or deceit, if the crime or act is substantially related to the qualifications, functions, or duties of a person engaged in business in accordance with this division. (3) The applicant or an officer, director, general partner, person responsible for the applicant’s lending activities or administering PACE programs for the applicant in this state, or person owning or controlling, directly or indirectly, 10 percent or more of the outstanding interests or equity securities of the applicant has violated any provision of this division or the rules thereunder or any similar regulatory scheme of the State of California or a foreign jurisdiction. (4) The applicant employs a mortgage loan originator who is not licensed, or has not initiated an application to become licensed, pursuant to this division. (b) The application shall be considered withdrawn within the meaning of this section if the applicant fails to respond to a written notification of a deficiency in the application within 90 days of the date of the notification. (c) The commissioner shall, within 60 days from the filing of a full and complete application for a license with the fees, either issue a license or file a statement of issues prepared in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code. (d) This section shall become operative on January 1, 2019. (Repealed (in Sec. 39) and added by Stats. 2017, Ch. 475, Sec. 40. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  126. 22109.1.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    The commissioner must deny a mortgage loan originator license application unless the listed findings are made.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22109.1. (a) The commissioner shall deny an application for a mortgage loan originator license unless the commissioner makes, at a minimum, the following findings: (1) The applicant has never had a mortgage loan originator license revoked in any governmental jurisdiction, except that a subsequent formal vacation of a revocation shall not be deemed a revocation. (2) (A) The applicant has not been convicted of, or pled guilty or nolo contendere to, a felony in a domestic, foreign, or military court during the seven-year period preceding the date of the application for licensing and registration, or at any time preceding the date of application, if the felony involved an act of fraud, dishonesty, or a breach of trust, or money laundering. Whether a particular crime is classified as a felony shall be determined by the law of the jurisdiction in which an individual is convicted. (B) For purposes of this paragraph, an expunged or pardoned felony conviction shall not require denial of an application. However, the commissioner may consider the underlying crime, facts, or circumstances of an expunged or pardoned felony conviction when determining the eligibility of an applicant for licensure under this paragraph or paragraph (3). (3) The applicant has demonstrated such financial responsibility, character, and general fitness as to command the confidence of the community and to warrant a determination that the mortgage loan originator will operate honestly, fairly, and efficiently within the purposes of this division. (4) The applicant has completed the prelicensing education requirement described in Section 22109.2. (5) The applicant has passed a written test that meets the test requirement described in Section 22109.3. (6) The applicant is employed by, and subject to the supervision of, a finance lender or broker that has obtained a license from the commissioner pursuant to this division. (b) Before denying a license under this section, the commissioner shall proceed as prescribed by Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code and shall have all the powers granted under that chapter. (Amended by Stats. 2011, Ch. 444, Sec. 3. (SB 217) Effective January 1, 2012.)
  127. 22109.2.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    Applicants for a mortgage loan originator license must complete 20 hours of approved education, and repeat applicants must prove prior-year continuing education. Approved courses are reviewed by the Nationwide Mortgage Licensing System and Registry.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22109.2. (a) An applicant for a mortgage loan originator license shall complete at least 20 hours of education approved in accordance with subdivision (b). The education shall include at least the following: (1) Three hours of instruction on federal law and regulations. (2) Three hours of ethics, which shall include instruction on fraud, consumer protection, and fair lending issues. (3) Two hours of training related to lending standards for the nontraditional mortgage product marketplace. (4) Two hours of training related to relevant California law and regulations. (b) For purposes of subdivision (a), prelicensing education courses shall be reviewed and approved by the Nationwide Mortgage Licensing System and Registry. Review and approval of a prelicensing education course shall include review and approval of the course provider. (c) Nothing in this section shall preclude any prelicensing education course, as approved by the Nationwide Mortgage Licensing System and Registry, that is provided by the employer of the applicant or an entity that is affiliated with the applicant by an agency contract, or any subsidiary or affiliate of the employer or entity. (d) Prelicensing education may be offered either in a classroom, online, or by any other means approved by the Nationwide Mortgage Licensing System and Registry. (e) The prelicensing education requirements approved by the Nationwide Mortgage Licensing System and Registry for any state other than California shall be accepted as credit toward completion of prelicensing education requirements in California. (f) An individual previously licensed under this division as a mortgage loan originator, applying to be licensed again, shall prove that he or she has completed all of the continuing education requirements for the year in which the license was last held. (Amended by Stats. 2014, Ch. 123, Sec. 1. (SB 1459) Effective January 1, 2015.)
  128. 22109.3.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    Applicants for a mortgage loan originator license must pass an approved qualified written test.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22109.3. (a) An applicant for a mortgage loan originator license shall pass a qualified written test developed or otherwise deemed acceptable by the Nationwide Mortgage Licensing System and Registry and administered by a test provider approved by the Nationwide Mortgage Licensing System and Registry. (b) A written test shall not be treated as a qualified written test for purposes of subdivision (a) unless the test adequately measures the applicant’s knowledge and comprehension in appropriate subject areas, including all of the following: (1) Ethics. (2) Federal law and regulation relating to mortgage origination. (3) State law and regulation relating to mortgage origination. (4) Federal and state law and regulation, including instruction on fraud, consumer protection, the nontraditional mortgage marketplace, and fair lending issues. (c) Nothing in this section shall prohibit a test provider approved by the Nationwide Mortgage Licensing System and Registry from providing a test at the location of the employer of the applicant or the location of any subsidiary or affiliate of the employer of the applicant, or the location of any entity with which the applicant holds an exclusive arrangement to conduct the business of a mortgage loan originator. (d) An individual shall not be considered to have passed a qualified written test administered pursuant to this section unless the individual achieves a test score of not less than 75 percent of correct answers to questions. (e) An individual who fails the qualified written test may retake the test up to three consecutive times, although at least 30 days shall pass between each retesting. (f) An applicant who fails three consecutive retests shall wait at least six months before retesting. (g) A licensed mortgage loan originator who fails to maintain a valid license for a period of five years or longer shall retake the test, not taking into account any time during which the individual is a registered mortgage loan originator. (Amended by Stats. 2014, Ch. 123, Sec. 2. (SB 1459) Effective January 1, 2015.)
  129. 22109.4.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A mortgage loan originator must comply with this section’s requirements by December 31 each year.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22109.4. (a) A mortgage loan originator shall comply with the requirements of this section on or before December 31 of every year. (b) The minimum standards for license renewal for a mortgage loan originator shall include the following: (1) The mortgage loan originator continues to meet the minimum standards for license issuance under Section 22109.1. (2) The mortgage loan originator has satisfied the annual continuing education requirements described in Section 22109.5. (3) The mortgage loan originator, or the finance lender or broker employing the mortgage loan originator, has paid all required fees for renewal of the license as provided in Section 22107. (c) The license of a mortgage loan originator failing to satisfy the minimum standards for license renewal shall expire at midnight on December 31, except as provided in subdivision (h) of Section 22109.5. The commissioner may adopt procedures for the reinstatement of expired licenses consistent with the standards established by the Nationwide Mortgage Licensing System and Registry. (Amended by Stats. 2010, Ch. 287, Sec. 9. (SB 1137) Effective January 1, 2011.)
  130. 22109.5.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    Licensed mortgage loan originators must complete at least eight hours of approved continuing education, and the courses must be approved by the Nationwide Mortgage Licensing System and Registry.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22109.5. (a) A licensed mortgage loan originator shall complete at least eight hours of continuing education approved in accordance with subdivision (b). The continuing education shall include at least the following: (1) Three hours of instruction on federal law and regulations. (2) Two hours of ethics, which shall include instruction on fraud, consumer protection, and fair lending issues. (3) Two hours of training related to lending standards for the nontraditional mortgage product marketplace. (4) One hour of training related to relevant California law and regulations. (b) For purposes of this section, continuing education courses shall be reviewed and approved by the Nationwide Mortgage Licensing System and Registry. Review and approval of a continuing education course shall include review and approval of the course provider. (c) Nothing in this section shall preclude any education course, as approved by the Nationwide Mortgage Licensing System and Registry, that is provided by the employer of the mortgage loan originator or an entity which is affiliated with the mortgage loan originator by an agency contract, or any subsidiary or affiliate of the employer or entity. (d) Continuing education may be offered in a classroom, online, and by any other means approved by the Nationwide Mortgage Licensing System and Registry. (e) Except as provided in subdivision (i), a licensed mortgage loan originator: (1) May only receive credit for a continuing education course in the year in which the course is taken. (2) May not take the same approved course in the same or successive years to meet the annual requirements for continuing education. (f) A licensed mortgage loan originator who is an approved instructor of an approved continuing education course may receive credit for the licensed mortgage loan originator’s own annual continuing education requirement at the rate of two hours credit for every one hour taught. (g) A person who has successfully completed continuing education requirements approved by the Nationwide Mortgage Licensing System and Registry for any state other than California shall be granted credit toward completion of continuing education requirements in California. (h) A licensed mortgage loan originator who subsequently becomes unlicensed shall complete the continuing education requirements for the last year in which the license was held prior to issuance of a new or renewed license. (i) A person meeting the requirements of paragraphs (1) and (3) of subdivision (b) of Section 22109.4 may correct any deficiency in continuing education as established by rule or regulation of the commissioner. (Amended by Stats. 2014, Ch. 123, Sec. 3. (SB 1459) Effective January 1, 2015.)
  131. 22109.6.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    The commissioner must require mortgage loan originators to be licensed and registered through the Nationwide Mortgage Licensing System and Registry.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22109.6. In addition to any other duties imposed upon the commissioner by law, the commissioner shall require mortgage loan originators to be licensed and registered through the Nationwide Mortgage Licensing System and Registry. In order to carry out this requirement, the commissioner is authorized to participate in the Nationwide Mortgage Licensing System and Registry. For this purpose, the commissioner may establish by rule, regulation, or order, requirements as necessary, including, but not limited to, the following: (a) Background information for the following: (1) Criminal history through fingerprint or other databases. (2) Civil or administrative records. (3) Credit history. (4) Any other information as deemed necessary by the Nationwide Mortgage Licensing System and Registry. (b) The payment of fees to apply for or renew licenses through the Nationwide Mortgage Licensing System and Registry. (c) The setting or resetting as necessary of renewal or reporting dates. (d) Requirements for amending or surrendering a license or any other activities as the commissioner deems necessary for participation in the Nationwide Mortgage Licensing System and Registry. (Added by Stats. 2009, Ch. 160, Sec. 30. (SB 36) Effective October 11, 2009.)
  132. 22110.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    License-denial proceedings must follow Government Code Chapter 5, and the commissioner has all powers granted there.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22110. The proceedings for a denial of a license shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code, and the commissioner has all the powers granted therein. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  133. 22111.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    Money paid or collected under this division must be deposited in the State Treasury to the credit of the State Corporations Fund, and administration costs for the division must be paid from that fund.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22111. All money paid or collected under this division shall be deposited in the State Treasury to the credit of the State Corporations Fund. The administration of this division shall be supported out of the State Corporations Fund. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  134. 22112.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    Licensees must maintain a $25,000 surety bond, file it with the commissioner within 10 days, replace it after certain bond actions, and cover employed mortgage loan originators under the bond.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Licensing [22100 - 22112] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22112. (a) A licensee shall maintain a surety bond in accordance with this subdivision in a minimum amount of twenty-five thousand dollars ($25,000). The bond shall be payable to the commissioner and issued by an insurer authorized to do business in this state. An original surety bond, including any and all riders and endorsements executed subsequent to the effective date of the bond, shall be filed with the commissioner within 10 days of execution. For licensees with multiple licensed locations, only one surety bond is required. The bond shall be used for the recovery of expenses, fines, and fees levied by the commissioner in accordance with this division or for losses or damages incurred by borrowers or consumers as the result of a licensee’s noncompliance with the requirements of this division. (b) When an action is commenced on a licensee’s bond, the commissioner may require the filing of a new bond. Immediately upon recovery of any action on the bond, the licensee shall file a new bond. Failure to file a new bond within 10 days of the recovery on a bond, or within 10 days after notification by the commissioner that a new bond is required, constitutes sufficient grounds for the suspension or revocation of the license. (c) The commissioner may by rule require a higher bond amount for a licensee who employs one or more mortgage loan originators and who makes or arranges residential mortgage loans, based on the dollar amount of residential mortgage loans originated by that licensee and any mortgage loan originators employed by that licensee. Every mortgage loan originator employed by the licensee shall be covered by the surety bond. (Amended by Stats. 2010, Ch. 287, Sec. 10. (SB 1137) Effective January 1, 2011.)
  135. 22150.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    The commissioner may issue general rules, regulations, rulings, demands, and findings to enforce this division.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22150. The commissioner may make general rules and regulations and specific rulings, demands, and findings for the enforcement of this division, in addition to, and within the general purposes of, this division. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  136. 22151.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    Certain finance-related licenses must be posted at the authorized place of business, and licenses generally cannot be transferred or assigned.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22151. (a) A finance lender license, broker license, program administrator license, and the license of every mortgage loan originator employed by a lender or finance broker, along with any currently effective order of the commissioner approving a different name pursuant to Section 22155, shall be conspicuously posted in the place of business authorized by the license. (b) A license is not transferable or assignable. A license issued to a partnership or a limited partnership is not transferred or assigned within the meaning of this section by the death, withdrawal, or admission of a partner, general partner, or limited partner, unless the death, withdrawal, or admission dissolves the partnership to which the license was issued. (c) This section shall become operative on January 1, 2019. (Repealed (in Sec. 41) and added by Stats. 2017, Ch. 475, Sec. 42. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  137. 22152.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A finance lender, broker, or program administrator licensee must keep only one place of business under a duplicate or original license. The commissioner may issue more than one license to the same licensee if the division’s original-issuance requirements are met.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22152. (a) A finance lender, broker, or program administrator licensee shall maintain only one place of business under a duplicate or original license issued pursuant to Section 22101 or 22102. The commissioner may issue more than one license to the same licensee upon compliance with all the provisions of this division governing an original issuance of a license. (b) This section shall become operative on January 1, 2019. (Repealed (in Sec. 43) and added by Stats. 2017, Ch. 475, Sec. 44. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  138. 22153.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A licensee changing its business address must give the commissioner at least 10 days’ notice, and the commissioner can disapprove within 10 days; if not, the change is deemed approved.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22153. (a) If a finance lender, broker, or program administrator licensee seeks to change its place of business to a street address other than that designated in its license, the licensee shall provide notice to the commissioner at least 10 days before the change. The commissioner shall notify the licensee within 10 days if the commissioner disapproves the change, and if the commissioner does not notify the licensee of disapproval within 10 days, the change in address shall be deemed approved. The commissioner may require an applicant to submit its application to change its place of business through the Nationwide Mortgage Licensing System and Registry. (b) If notice is not given at least 10 days before the change of a street address of a place of business, as required by subdivision (a), or notice is not given at least 10 days before engaging in business at a new location, as required by Section 22102, the commissioner may assess a civil or administrative penalty on the licensee not to exceed five hundred dollars ($500). (c) This section shall become operative on January 1, 2019. (Repealed (in Sec. 45) and added by Stats. 2017, Ch. 475, Sec. 46. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  139. 22154.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A licensee generally may not run loan-making or PACE program business in the same premises as another business unless the commissioner authorizes it in writing; some affiliated financial institution products may be offered at the licensed location if specified conditions are met.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22154. (a) Subject to Section 22157.1, a licensee shall not conduct the business of making loans or administering a PACE program under this division within any office, room, or place of business in which any other business is solicited or engaged in, or in association or conjunction therewith, except as is authorized in writing by the commissioner upon the commissioner’s finding that the character of the other business is such that the granting of the authority would not facilitate evasions of this division or of the rules and regulations made pursuant to this division. An authorization, once granted, remains in effect until revoked by the commissioner. The commissioner may authorize the other business through the Nationwide Mortgage Licensing System and Registry. (b) The products or services of an affiliated corporation of the licensee that is a supervised financial institution, or a parent or subsidiary of a supervised financial institution that is an affiliate of the licensee, may be provided, offered, or sold at the licensed location of the licensee without authorization by the commissioner pursuant to subdivision (a) if both of the following are met: (1) The activity is not prohibited by, or in violation of, the laws applicable to the affiliate or supervised financial institution. (2) The products and services are not offered and sold in a manner that restricts the ability of the borrower or customer to individually select or reject a product or service that is offered. (c) The following definitions govern the construction of this section: (1) “Affiliated” or “affiliate” means the following: A corporation is an affiliate of, or a corporation is affiliated with, another specified corporation if it directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, the other specified corporation. (2) “Supervised financial institution” means any commercial bank, industrial bank, credit card bank, trust company, savings and loan association, savings bank, credit union, California finance lender, residential mortgage lender or servicer, or insurer, provided that the institution is subject to supervision by an official or agency of this state or of the United States. (Amended by Stats. 2022, Ch. 181, Sec. 1. (AB 2001) Effective January 1, 2023.)
  140. 22155.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    Certain licensed lenders and related licensees generally may not do licensed business under a different name or at a different business location unless the commissioner issues a currently effective written order; a separate rule allows some activity away from the licensed location if specific conditions are met.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22155. Subject to Section 22157.1, a finance lender, broker, mortgage loan originator, or program administrator licensee shall not transact the business licensed or make any loan or administer any PACE program provided for by this division under any other name or at any other place of business than that named in the license except pursuant to a currently effective written order of the commissioner authorizing the other name or other place of business. The commissioner’s order, while effective, shall be deemed to amend the original license issued pursuant to Section 22105 or 22109.1. Notwithstanding any provision of this section, a finance lender, program administrator, broker, or mortgage loan originator licensee may make any loan and engage in any other business provided for by this division, other than the business described in subdivision (b) of Section 22154, at a place other than the licensed location under either of the following conditions: (a) The borrower requests, either orally or in writing, that a loan be initiated or made at a location other than the licensee’s licensed location. The use by the licensee of a preprinted solicitation form returned to the licensee by the borrower shall not constitute a request by the borrower that a loan be initiated or made at a location other than the licensee’s licensed location. (b) The licensee makes a solicitation or advertises for, or makes an offer of, a loan or assessment contract displayed on “home pages” or similar methods by the licensee on the internet, the World Wide Web, or similar proprietary or common carrier electronic systems, and the prospective borrower or property owner may transmit information over these electronic systems to the licensee in connection with the licensee’s offer to make a loan or assessment contract. (Amended by Stats. 2022, Ch. 181, Sec. 2. (AB 2001) Effective January 1, 2023.)
  141. 22156.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    Certain licensees must keep business records, retain specified loan records in some real-property loans, and file an authorization for disclosure of financial records when the commissioner asks.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22156. (a) Finance lender, broker, program administrator, and mortgage loan originator licensees shall keep and use in their business, books, accounts, and records which will enable the commissioner to determine if the licensee is complying with the provisions of this division and with the rules and regulations made by the commissioner. On any loan secured by real property in which loan proceeds were disbursed to an independent escrowholder, the licensee shall retain records and documents as set forth by rules of the commissioner adopted pursuant to Section 22150. Upon request of the commissioner, licensees shall file an authorization for disclosure to the commissioner of financial records of the licensed business pursuant to Section 7473 of the Government Code. (b) This section shall become operative on January 1, 2019. (Repealed (in Sec. 51) and added by Stats. 2017, Ch. 475, Sec. 52. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  142. 22157.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    Certain licensees must keep books, accounts, and records for at least three years, measured from the relevant loan entry or PACE assessment extinguishment record.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22157. (a) Finance lender, broker, and mortgage loan originator licensees shall preserve their books, accounts, and records, if any, for at least three years after making the final entry on any loan recorded therein. (b) Except as otherwise specified by applicable law, including paragraph (3) of subdivision (b) of Section 5913 of the Streets and Highways Code, program administrator licensees shall preserve their books, accounts, and records for at least three years after the extinguishment of a PACE assessment is recorded therein. (c) This section shall become operative on January 1, 2019. (Amended (as added by Stats. 2017, Ch. 475, Sec. 54) by Stats. 2018, Ch. 813, Sec. 4. (AB 2063) Effective January 1, 2019.)
  143. 22157.1.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    A licensee may let an employee work from a remote location, but only if the licensee meets listed privacy, security, supervision, and records rules.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22157.1. (a) For purposes of this section: (1) “Encrypted” has the same meaning as provided in paragraph (4) of subdivision (i) of Section 1798.82 of the Civil Code. (2) “Remote location” means a personal residence or a temporary, nonpublic location not owned or leased by the licensee or an affiliate of the licensee that is not simultaneously accessible by anyone other than a single employee and individuals who maintain a common household with the employee. (b) A licensee may designate an employee, when acting within the scope of employment, to perform work on the licensee’s behalf at a remote location if the licensee does all of the following: (1) Prohibits in-person consumer interactions, including the physical receipt of cash or other monetary value or the disbursement of loan proceeds, at a remote location and does not designate a remote location to the public as a business location. (2) Prohibits records required pursuant to Section 22156 from being physically mailed to, shipped to, or stored at a remote location except for storage on an encrypted device or encrypted media. (3) Prohibits the physical receipt of mail related to the licensee’s licensed business at a remote location. (4) Prohibits a consumer’s personal information from being physically stored at a remote location except for storage on an encrypted device or encrypted media. (5) Provides an employee working at a remote location with appropriate equipment, which may include encrypted devices, virtual private networks, and similar technology, to perform work and safeguard licensee records and consumer personal information. (6) Adopts and adheres to appropriate, as determined by the department, written policies and procedures to supervise and maintain appropriate control over the work of employees at remote locations and safeguard the licensee’s records and consumer personal information in connection with work at a remote location, including, but not limited to, all of the following elements: (A) Employee data security training. (B) Maintenance of security logs of remote logins. (C) Procedures designed to detect suspicious logins or attempted logins and to suspend access by potentially compromised accounts or equipment. (D) Data breach response procedures. (7) (A) Records telephone calls with consumers conducted from a remote location to the same extent as telephone calls with consumers conducted from licensed locations. (B) This paragraph does not require telephone call recording if the licensee does not do so in the normal course of business for the employee or business in question. (8) All books, records, and persons that the commissioner is entitled to examine, inspect, or interview shall be made available to the commissioner at a licensed location. (Added by Stats. 2022, Ch. 181, Sec. 3. (AB 2001) Effective January 1, 2023.)
  144. 22158.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    Sections 22156 and 22157 do not require keeping original records, as long as any information the commissioner asks for can be provided within 48 hours, excluding Saturdays, Sundays, and holidays.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22158. Nothing contained in Sections 22156 and 22157 shall require the maintenance or preservation of original records, provided that any information requested by the commissioner can be furnished within 48 hours, excluding Saturdays, Sundays, and holidays as defined in Sections 6700 and 6701 of the Government Code. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  145. 22159.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    Certain licensees must file an annual report with the commissioner by March 15, and the commissioner may require additional reports or reports of condition in specific cases.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22159. (a) Each finance lender, broker, and program administrator licensee shall file an annual report with the commissioner, on or before March 15th, giving the relevant information that the commissioner reasonably requires concerning the business and operations conducted by the licensee or authorized by the program administrator licensee within the state during the preceding calendar year for each licensed place of business. The individual annual reports filed pursuant to this section shall be made available to the public for inspection except, upon request in the annual report to the commissioner, the balance sheet contained in the annual report of a sole proprietor or any other nonpublicly traded person. “Nonpublicly traded person” for purposes of this section means persons with securities owned by 35 or fewer individuals. The report shall be made under oath and in the form prescribed by the commissioner. (b) A licensee shall make other special reports that may be required by the commissioner. (c) The commissioner may require a licensee that employs one or more mortgage loan originators to submit to the Nationwide Mortgage Licensing System and Registry reports of condition, which shall be in the form and shall contain the information as the Nationwide Mortgage Licensing System and Registry may require. (d) The commissioner may by rule or order require a mortgage loan originator to submit reports of condition to the Nationwide Mortgage Licensing System and Registry, in lieu of the reports of condition required of his or her employer pursuant to subdivision (c). (e) This section shall become operative on January 1, 2019. (Repealed (in Sec. 55) and added by Stats. 2017, Ch. 475, Sec. 56. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  146. 22159.5.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    The commissioner may require licensees to report on residential mortgage loan servicing, may collect voluntary information from non-jurisdiction servicers, and must publish only aggregated results with certain counts and estimates.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22159.5. (a) The commissioner may, as the commissioner deems necessary, require licensees to provide reports concerning their residential mortgage loan servicing activities, including, but not limited to, information similar to that collected in connection with the Mortgage Servicers Survey, first published by the Department of Financial Protection and Innovation in December 2007. The commissioner is additionally authorized to seek and accept information provided on a voluntary basis by residential mortgage loan servicers not subject to the commissioner’s jurisdiction. The commissioner shall post only aggregated survey results on the department’s internet website, and shall note the number of loan servicers submitting data included in the aggregated totals and the estimated percentage of outstanding mortgage loans to Californians that are serviced by these loan servicers, to the extent information on the number of outstanding loans is available from a reliable source. Nothing in this section is intended to reduce or change the commissioner’s authority to request and demand reports under Sections 22150 and 22159. (b) For purposes of this section, “mortgage loan servicing activity” means receiving more than three installment payments of principal, interest, or other amounts placed in escrow, pursuant to the terms of a mortgage loan, and performing services relating to that receipt or the enforcement of its receipt, on behalf of the holder of the note evidencing that loan. (Amended by Stats. 2022, Ch. 452, Sec. 135. (SB 1498) Effective January 1, 2023.)
  147. 22160.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    The commissioner must annually make and file a public-record composite of the annual reports and any public-interest comments with the Department of Financial Protection and Innovation.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22160. The commissioner shall make and file annually with the Department of Financial Protection and Innovation as a public record a composite of the annual reports and any comments on the reports that the commissioner deems to be in the public interest. (Amended by Stats. 2022, Ch. 452, Sec. 136. (SB 1498) Effective January 1, 2023.)
  148. 22161.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    A person subject to this division must not make false, misleading, deceptive, or materially incomplete statements in loan or assessment-contract matters, and must not engage in listed unlawful acts or fraud-related conduct.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22161. (a) A person subject to this division shall not do any of the following: (1) Make a materially false or misleading statement or representation to a borrower about the terms or conditions of that borrower’s loan, when making or brokering the loan. (2) Make a materially false or misleading statement or representation to a property owner about the terms or conditions of an assessment contract. (3) Advertise, print, display, publish, distribute, or broadcast, or cause or permit to be advertised, printed, displayed, published, distributed, or broadcast in any manner, any statement or representation with regard to the business subject to the provisions of this division, including the rates, terms, or conditions for making or negotiating loans, or for making or negotiating assessment contracts, that is false, misleading, or deceptive, or that omits material information that is necessary to make the statements not false, misleading, or deceptive, or in the case of a licensee, that refers to the supervision of the business by the state or any department or official of the state. (4) Commit an act in violation of Section 1695.13 of the Civil Code. (5) Engage in any act in violation of Section 17200 of the Business and Professions Code. (6) Knowingly misrepresent, circumvent, or conceal, through subterfuge or device, any material aspect or information regarding a transaction to which the person is a party. (7) Commit an act that constitutes fraud or dishonest dealings. (b) This section shall become operative on January 1, 2019. (Repealed (in Sec. 57) and added by Stats. 2017, Ch. 475, Sec. 58. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  149. 22162.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    Certain licensees may not run primary-in-state loan or assessment contract ads unless the ad discloses the license under which the loan or contract is handled.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22162. (a) A finance lender, broker, or mortgage loan originator licensee shall not place an advertisement disseminated primarily in this state for a loan unless the licensee discloses in the printed text of the advertisement, or in the oral text in the case of a radio or television advertisement, the license under which the loan would be made or arranged. (b) A program administrator licensee shall not place an advertisement disseminated primarily in this state for an assessment contract unless the licensee discloses in the printed text of the advertisement, or in the oral text in the case of a radio or television advertisement, the license under which the assessment contract would be administered. (c) This section shall become operative on January 1, 2019. (Repealed (in Sec. 59) and added by Stats. 2017, Ch. 475, Sec. 60. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  150. 22163.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    The commissioner may require a licensee to state any stated rates of charge fully and clearly.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22163. (a) The commissioner may require that rates of charge, if stated by a licensee, be stated fully and clearly in the manner that the commissioner deems necessary to prevent misunderstanding by prospective borrowers or property owners. (b) This section shall become operative on January 1, 2019. (Repealed (in Sec. 61) and added by Stats. 2017, Ch. 475, Sec. 62. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  151. 22164.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    If a regulated business advertises interest rates, charges, or loan costs, it must disclose them fully and clearly, and it must clearly say when the advertised rates or costs do not apply to all classes of loans or assessment contracts.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22164. (a) If any person engaged in the business regulated by this division refers in any advertising to rates of interest, charges, or cost of loans or assessment contracts, the commissioner shall require that the rates, charges, or costs are stated fully and clearly in the manner that he or she deems necessary to give adequate information to prospective borrowers or property owners. If the rates or costs advertised do not apply to loans or assessment contracts of all classes made or negotiated by the person, this fact shall be clearly indicated in the advertisement. (b) This section shall become operative on January 1, 2019. (Repealed (in Sec. 63) and added by Stats. 2017, Ch. 475, Sec. 64. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  152. 22165.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    A licensee may not use advertising copy after the commissioner disapproves it and notifies the licensee in writing.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22165. No advertising copy shall be used after its use has been disapproved by the commissioner and the licensee is notified in writing of the disapproval. The commissioner may by order direct any licensee to submit advertising copy to the commissioner for review prior to use. (Amended by Stats. 2010, Ch. 640, Sec. 1. (SB 1146) Effective January 1, 2011.)
  153. 22166.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    The commissioner may require licensees to keep a file of all advertising copy for two years from its use, and licensees must make that file available on request.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22166. The commissioner may require licensees to maintain a file of all advertising copy for a period of two years from the date of its use. The file shall be available to the commissioner upon request. (Amended by Stats. 2010, Ch. 640, Sec. 2. (SB 1146) Effective January 1, 2011.)
  154. 22167.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    A licensed finance lender may act as a broker at its licensed place of business without an additional broker license if it gives the commissioner written notice.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22167. A licensed finance lender may act as a broker as defined in Section 22004 at its licensed place of business without obtaining an additional license as a broker under this division provided the licensee has notified the commissioner of the action in writing. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  155. 22168.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    The commissioner may suspend or bar a person from employment with a licensee if the person willfully misused or falsely used a designation or certification to mislead the public.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22168. (a) The commissioner may, after appropriate notice and opportunity for hearing, suspend for a period not to exceed 12 months or bar a person from any position of employment with a licensee if the commissioner finds that the person has willfully used or claimed without authority a designation or certification of special education, practice, or skill that the person has not attained, or willfully held out to the public a confusingly similar designation or certification for the purpose of misleading the public regarding his or her qualifications or experience. (b) Within 15 days from the date of a notice of intention to issue an order pursuant to subdivision (a), the person may request a hearing under the Administrative Procedure Act (Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code). Upon receiving a request, the matter shall be set for hearing to commence within 30 days after receipt unless the person subject to this division consents to a later date. If no hearing is requested within 15 days after the mailing or service of the notice and none is ordered by the commissioner, the failure to request a hearing shall constitute a waiver of the right to a hearing. (c) Upon receipt of a notice of intention to issue an order pursuant to subdivision (a), the person who is the subject of the proposed order is immediately prohibited from engaging in any activities subject to licensure under this division. (d) Persons suspended or barred under this section are prohibited from participating in any business activity of a licensed finance lender, broker, program administrator, or mortgage loan originator, and from engaging in any business activity on the premises where a licensed finance lender, broker, program administrator, or mortgage loan originator is conducting its business. This subdivision does not prohibit suspended or barred persons from having their personal transactions processed by a licensed finance lender, broker, mortgage loan originator, or program administrator. (e) This section shall become operative on January 1, 2019. (Repealed (in Sec. 65) and added by Stats. 2017, Ch. 475, Sec. 66. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, by its own provisions.)
  156. 22169.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    The commissioner may censure, suspend, or bar a person after notice and a hearing, and certain people are immediately restricted from licensable activities when notice of an order is issued.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22169. (a) The commissioner may, after appropriate notice and opportunity for hearing, by order, censure or suspend for a period not exceeding 12 months, or bar a person, including a mortgage loan originator, from any position of employment with, or management or control of, any finance lender, broker, program administrator, or any other person, if the commissioner finds either of the following: (1) That the censure, suspension, or bar is in the public interest and that the person has committed or caused a violation of this division or rule or order of the commissioner, which violation was either known or should have been known by the person committing or causing it or has caused material damage to the finance lender, broker, program administrator, or mortgage loan originator, or to the public. (2) That the person has been convicted of or pleaded nolo contendere to any crime, or has been held liable in any civil action by final judgment, or any administrative judgment by any public agency, if that crime or civil or administrative judgment involved any offense involving dishonesty, fraud, or deceit, or any other offense reasonably related to the qualifications, functions, or duties of a person engaged in the business in accordance with the provisions of this division. (b) Within 15 days from the date of a notice of intention to issue an order pursuant to subdivision (a), the person may request a hearing under the Administrative Procedure Act (Chapter 4.5 (commencing with Section 11400) of Part 1 of Division 3 of Title 2 of the Government Code). Upon receipt of a request, the matter shall be set for hearing to commence within 30 days after such receipt unless the person subject to this division consents to a later date. If no hearing is requested within 15 days after the mailing or service of such notice and none is ordered by the commissioner, the failure to request a hearing shall constitute a waiver of the right to a hearing. (c) Upon receipt of a notice of intention to issue an order pursuant to this section, the person who is the subject of the proposed order is immediately prohibited from engaging in any activities subject to licensure under the law. (d) Persons suspended or barred under this section are prohibited from participating in any business activity of a finance lender, broker, program administrator, or mortgage loan originator, and from engaging in any business activity on the premises where a finance lender, broker, program administrator, or mortgage loan originator is conducting business. (e) This section shall become operative on January 1, 2019. (Amended by Stats. 2023, Ch. 100, Sec. 3. (AB 1312) Effective January 1, 2024.)
  157. 22170.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    It is unlawful for any person to knowingly tamper with records or make false statements to the commissioner or the Nationwide Mortgage Licensing System and Registry when doing so is intended to impede enforcement of this division.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22170. (a) It is unlawful for any person to knowingly alter, destroy, mutilate, conceal, cover up, falsify, or make a false entry in any record, document, or tangible object with the intent to impede, obstruct, or influence the administration or enforcement of any provision of this division. (b) It is unlawful for any person to knowingly make an untrue statement to the commissioner or the Nationwide Mortgage Licensing System and Registry during the course of licensing, investigation, or examination, with the intent to impede, obstruct, or influence the administration or enforcement of any provision of this division. (Amended by Stats. 2009, Ch. 160, Sec. 40.5. (SB 36) Effective October 11, 2009.)
  158. 22171.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    The commissioner must apply specified mortgage-risk guidance to licensees, may issue regulations to clarify the section, and certain licensees must follow policies and procedures tied to those guidance documents.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22171. (a) The commissioner shall apply the guidance on nontraditional mortgage product risks published on November 14, 2006, by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, and the Statement on Subprime Mortgage Lending published on July 17, 2007, by the aforementioned entities and the National Association of Consumer Credit Administrators, to licensees. (b) The commissioner may adopt emergency and final regulations to clarify the application of this section as soon as possible. (c) A finance lender or broker licensee shall adopt and adhere to policies and procedures that are reasonably intended to achieve the objectives set forth in the documents described in subdivision (a). A mortgage loan originator licensee shall adhere to policies and procedures developed by its employer in accordance with this division and applicable federal law and regulation. (Amended by Stats. 2009, Ch. 160, Sec. 41. (SB 36) Effective October 11, 2009.)
  159. 22172.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    The commissioner may discipline mortgage loan originator licenses, order restitution, impose fines and civil penalties, and issue stop-business or corrective orders.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 1. General Provisions [22000 - 22172] ( Chapter 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 4. Regulations [22150 - 22172] ( Article 4 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22172. (a) The commissioner may do one or more of the following: (1) Deny, suspend, revoke, condition, or decline to renew a mortgage loan originator license for a violation of this division, or any rules or regulations adopted thereunder. (2) Deny, suspend, revoke, condition, or decline to renew a mortgage loan originator license if an applicant or licensee fails at any time to meet the requirements of Section 22109.1 or 22109.4, or withholds information or makes a material misstatement in an application for a license or license renewal. (3) Order restitution against a mortgage loan originator or any finance lender or broker licensee employing a mortgage loan originator for a violation of this division. (4) Impose fines on a mortgage loan originator or any finance lender or broker licensee employing a mortgage loan originator pursuant to subdivisions (b), (c), and (d). (5) Issue orders or directives to mortgage loan originators under this division as follows: (A) Order or direct a mortgage loan originator or any finance lender or broker licensee employing a mortgage loan originator to desist and refrain from conducting business, including immediate temporary orders to desist and refrain. (B) Order or direct a mortgage loan originator or any finance lender or broker licensee employing a mortgage loan originator to cease any harmful activities or violations of this division, including immediate temporary orders to desist and refrain. (C) Enter immediate temporary orders to cease business under a license issued pursuant to the authority granted under Section 22100 if the commissioner determines that the license was erroneously granted or the mortgage loan originator is currently in violation of this division. (D) Order or direct any other affirmative action as the commissioner deems necessary. (b) The commissioner may impose a civil penalty on a mortgage loan originator or any finance lender or broker licensee employing a mortgage loan originator, if the commissioner finds, on the record after notice and opportunity for hearing, that the mortgage loan originator or any finance lender or broker licensee employing a mortgage loan originator has violated or failed to comply with any requirement of this division or any regulation prescribed by the commissioner under this division or order issued under authority of this division. (c) The maximum amount of penalty for each act or omission described in subdivision (b) shall be twenty-five thousand dollars ($25,000). (d) Each violation or failure to comply with any directive or order of the commissioner is a separate and distinct violation or failure. (Added by Stats. 2009, Ch. 160, Sec. 41.5. (SB 36) Effective October 11, 2009.)
  160. 22200.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22200 - 22204] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    “Charges” are defined broadly to include many kinds of costs tied to loan or forbearance services.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22200 - 22204] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22200. “Charges” include the aggregate interest, fees, bonuses, commissions, brokerage, discounts, expenses, and other forms of costs charged, contracted for, or received by a licensee or any other person in connection with the investigating, arranging, negotiating, procuring, guaranteeing, making, servicing, collecting, and enforcing of a loan or forbearance of money, credit, goods, or things in action, or any other service rendered. (Repealed and added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  161. 22201.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22200 - 22204] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section defines “charges” to include profits or advantages a licensee may obtain in connection with a loan.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22200 - 22204] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22201. “Charges” include any profit or advantage of any kind that a licensee may contract for, collect, receive, or obtain by a collateral sale, purchase, or agreement, in connection with negotiating, arranging, making, or otherwise in connection with any loan. (Repealed and added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  162. 22202.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22200 - 22204] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section defines what does not count as “charges” under the consumer loans law and sets caps and conditions for some excluded items.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22200 - 22204] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22202. “Charges” do not include any of the following: (a) Commissions received as a licensed insurance agent or broker in connection with insurance written as provided in Section 22313. (b) Amounts not in excess of the amounts specified in subdivision (c) of Section 3068 of the Civil Code paid to holders of possessory liens, imposed pursuant to Chapter 6.5 (commencing with Section 3067) of Title 14 of Part 4 of Division 3 of the Civil Code, to release motor vehicles that secure loans subject to this division. (c) Court costs, excluding attorney’s fees, incurred in a suit and recovered against a debtor who defaults on the debtor’s loan. (d) Amounts received by a licensee from a seller, from whom the borrower obtains money, goods, labor, or services on credit, in connection with a transaction under an open-end credit program that are paid or deducted from the loan proceeds paid to the seller at the direction of the borrower and that are an obligation of the seller to the licensee for the privilege of allowing the seller to participate in the licensee’s open-end credit program. Amounts received by a licensee from a seller pursuant to this subdivision may not exceed 6 percent of the loan proceeds paid to the seller at the direction of the borrower. (e) Actual and necessary fees not exceeding five hundred dollars ($500) paid in connection with the repossession of a motor vehicle to repossession agencies licensed pursuant to Chapter 11 (commencing with Section 7500) of Division 3 of the Business and Professions Code provided that the licensee complies with Sections 22328 and 22329, and actual fees paid to a licensee in conformity with Sections 26751 and 41612 of the Government Code in an amount not exceeding the amount specified in those sections of the Government Code. (f) Moneys paid to, and commissions and benefits received by, a licensee for the sale of goods, services, or insurance, whether or not the sale is in connection with a loan, that the buyer by a separately signed authorization acknowledges is optional, if sale of the goods, services, or insurance has been authorized pursuant to Section 22154. (Amended by Stats. 2019, Ch. 708, Sec. 2. (AB 539) Effective January 1, 2020.)
  163. 22203.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22200 - 22204] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    Defines “consumer loan” and lets a lender rely on the borrower’s signed written statement of intended purposes.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22200 - 22204] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22203. “Consumer loan” means a loan, whether secured by either real or personal property, or both, or unsecured, the proceeds of which are intended by the borrower for use primarily for personal, family, or household purposes. For purposes of determining whether a loan is a consumer loan, the lender may rely on any written statement of intended purposes signed by the borrower. The statement may be a separate statement signed by the borrower, or may be contained in a loan application or other document signed by the borrower. The lender shall not be required to ascertain that the proceeds of the loan are used in accordance with the statement of intended purposes. Nothing in this section shall authorize the taking of real property as security, except as specified in Section 22330. (Amended by Stats. 1999, Ch. 347, Sec. 1. Effective January 1, 2000.)
  164. 22204.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22200 - 22204] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section defines when a loan counts as a consumer loan and lets the lender rely on the borrower’s signed written statement about intended use.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 1. Definitions [22200 - 22204] ( Article 1 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22204. (a) In addition to the definition of consumer loan in Section 22203, a “consumer loan” also means a loan of a principal amount of less than five thousand dollars ($5,000), the proceeds of which are intended by the borrower for use primarily for other than personal, family, or household purposes. For purposes of determining whether a loan is or is not a consumer loan, the lender may rely on any written statement of intended purposes signed by the borrower. The statement may be a separate statement signed by the borrower or may be contained in a loan application or other document signed by the borrower. The lender shall not be required to ascertain that the proceeds of the loan are used in accordance with the statement of intended purposes. (b) A consumer loan under this section is a loan secured in the manner provided for in this division if it is secured, in whole or in part, by any lien on, security interest in, assignment of, or power of attorney relative to income arising from the operation of a business by the borrower, such as accounts, and chattel paper, including the right to payment for accounts or chattel paper sold by the borrower prior to or contemporaneously with the making of the loan. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  165. 22250.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22250 - 22252] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    This section exempts certain larger consumer loans from specified Finance Code sections, if the section is not being used to evade the division.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22250 - 22252] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22250. (a) The following sections do not apply to any loan of a bona fide principal amount of ten thousand dollars ($10,000) or more, or to a duly licensed finance lender in connection with any such loan or loans, if the provisions of this section are not used for the purpose of evading this division: Sections 22154, 22155, 22201, 22202, 22307, 22313, 22314, 22315, 22322, 22323, 22325, 22334, and 22752, and the sections enumerated in subdivision (b). (b) The following sections do not apply to any loan of a bona fide principal amount of five thousand dollars ($5,000) or more, or to a duly licensed finance lender in connection with any such loan or loans, if the provisions of this section are not used for the purpose of evading this division: Sections 22300, 22305, and 22306, subdivision (a) of Section 22307, and Sections 22309, 22320.5, 22326, 22327, 22400, and 22751. (Amended by Stats. 2019, Ch. 708, Sec. 3. (AB 539) Effective January 1, 2020.)
  166. 22251.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22250 - 22252] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section limits when related loan provisions apply and sets anti-evasion rules for loans tied to regulatory ceilings.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22250 - 22252] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22251. Any section that refers to this section does not apply to any loan of the bona fide principal amount specified in the regulatory ceiling provision of that section or more if that provision is not used for the purpose of evading this division. In determining under Section 22250, 22303, 22304, or 22304.5 or any section that refers to this section whether a loan is a loan of a bona fide principal amount of the amount specified in that section or more and whether the regulatory ceiling provision of that section is used for the purpose of evading this division, the following principles apply: (a) If a borrower applies for a loan in a bona fide principal amount of less than the specified amount and a loan to that borrower of a bona fide principal amount of the specified amount or more is made by a licensed finance lender, no adequate economic reason for the increase in the size of the loan exists, and by prearrangement or understanding between the borrower and the licensee a substantial payment is to be made upon the loan with the effect of reducing the bona fide principal amount of the loan to less than the specified amount within a short time after the making of the loan other than by reason of a requirement that the loan be paid in substantially equal periodical installments, then the loan shall not be deemed to be a loan of the bona fide principal amount of the specified amount or more and the regulatory ceiling provisions shall be deemed to be used for the purpose of evading this division unless the loan complies with the other provisions of the section that includes the regulatory ceiling provisions. (b) If a loan made by a licensed finance lender is in a bona fide principal amount of the specified amount or more, the fact that the transaction is in the form of a sale of accounts, chattel paper, goods, or instruments or a lease of goods, or in the form of an advance on the purchase price of any of the foregoing, shall not be deemed to affect the loan or the bona fides of the amount thereof or to indicate that the regulatory ceiling provisions are used for the purpose of evading this division. (c) For the purposes of determining whether the loan amount exceeds a regulatory ceiling, the “bona fide principal amount” shall not be comprised of any charges or any other fees or recompense specified in Sections 22200, 22201, 22202, 22305, 22316, 22317, 22318, 22319, 22320, 22320.5, and 22336, or any amounts paid for insurance of the types specified in Sections 22313 and 22314, or any fees paid to a licensee for the privilege of participating in an open-end credit program. Nothing in this subdivision shall be construed to prevent those specified charges, fees, and recompense that have been earned and remain unpaid in an existing loan from being considered as part of the bona fide principal amount of a new loan to refinance that existing loan, provided the new loan is not made for the purpose of circumventing a regulatory ceiling provision. This subdivision is intended to define the meaning of “bona fide principal amount” as used in this division solely for the purposes of determining whether the loan amount exceeds a regulatory ceiling, and is not intended to affect the meaning of “principal” for any other purpose. (Amended by Stats. 2019, Ch. 708, Sec. 4. (AB 539) Effective January 1, 2020.)
  167. 22252.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22250 - 22252] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This chapter does not apply to a program administrator or a PACE solicitor.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 2. Exemptions [22250 - 22252] ( Article 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22252. This chapter does not apply to a program administrator or a PACE solicitor. (Added by Stats. 2017, Ch. 475, Sec. 69. (AB 1284) Effective October 4, 2017.)
  168. 22300.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    A licensee may not charge, contract for, or receive interest or any other charge unless a loan is made.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22300. No licensee shall directly or indirectly charge, contract for, or receive any interest or charge of any nature unless a loan is made. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  169. 22301.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    A licensee generally may not charge or collect interest or other charges on a loan of $5,000 or more unless the loan is made. If the loan is not completed for certain borrower-related reasons, the licensee may recover actual preparation expenses.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22301. (a) No licensee shall directly or indirectly charge, contract for, or receive any interest or charge of any nature with respect to a loan of five thousand dollars ($5,000) or more unless the loan is made. (b) Notwithstanding subdivision (a), whenever a loan of five thousand dollars ($5,000) or more is not consummated because of the borrower’s failure to disclose outstanding liens or other information essential to making the loan or solely because of the borrower’s failure to complete the loan in accordance with the loan application, a licensee may charge, contract for, and receive an amount equal to the actual expenses incurred by the licensee in connection with the preparation for the loan. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  170. 22302.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    Civil Code Section 1670.5 applies to loan contracts covered by this division, and unconscionable loans are treated as violations subject to the division’s remedies.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22302. (a) Section 1670.5 of the Civil Code applies to the provisions of a loan contract that is subject to this division. (b) A loan found to be unconscionable pursuant to Section 1670.5 of the Civil Code shall be deemed to be in violation of this division and subject to the remedies specified in this division. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  171. 22303.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    A licensee who lends money may charge fees at rates capped by the statute, unless the loan is a bona fide principal amount of $2,500 or more.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22303. Every licensee who lends any sum of money may contract for and receive charges at a rate not exceeding the sum of the following: (a) Two and one-half percent per month on that part of the unpaid principal balance of any loan up to, including, but not in excess of two hundred twenty-five dollars ($225). (b) Two percent per month on that portion of the unpaid principal balance in excess of two hundred twenty-five dollars ($225) up to, including, but not in excess of nine hundred dollars ($900). (c) One and one-half percent per month on that part of the unpaid principal balance in excess of nine hundred dollars ($900) up to, including, but not in excess of one thousand six hundred fifty dollars ($1,650). (d) One percent per month on any remainder of such unpaid balance in excess of one thousand six hundred fifty dollars ($1,650). This section does not apply to any loan of a bona fide principal amount of two thousand five hundred dollars ($2,500) or more as determined in accordance with Section 22251. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  172. 22304.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    A licensee may charge the greater of two listed monthly-rate formulas, but the section does not apply to loans of $2,500 or more.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22304. As an alternative to the charges authorized by Section 22303, a licensee may contract for and receive charges at the greater of the following: (a) A rate not exceeding 1.6 percent per month on the unpaid principal balance. (b) A rate not exceeding five-sixths of 1 percent per month plus a percentage per month equal to one-twelfth of the annual rate prevailing on the 25th day of the second month of the quarter preceding the quarter in which the loan is made, as established by the Federal Reserve Bank of San Francisco, on advances to member banks under Sections 13 and 13a of the Federal Reserve Act, as now in effect or hereafter from time to time amended, or if there is no single determinable rate for advances, the closest counterpart of this rate as shall be determined by the Commissioner of Financial Institutions. Charges shall be calculated on the unpaid principal balance. (c) This section does not apply to any loan of a bona fide principal amount of two thousand five hundred dollars ($2,500) or more as determined in accordance with Section 22251. (Amended by Stats. 2006, Ch. 538, Sec. 176. Effective January 1, 2007.)
  173. 22304.5.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    For certain consumer loans, a finance lender may charge up to 36% per year plus the Federal Funds Rate, and must report borrower payment performance and offer a commissioner-approved credit education program before disbursing proceeds.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22304.5. (a) For any loan of a bona fide principal amount of at least two thousand five hundred dollars ($2,500) but less than ten thousand dollars ($10,000), as determined in accordance with Section 22251, a finance lender may contract for or receive charges at a rate not exceeding an annual simple interest rate of 36 percent per annum plus the Federal Funds Rate. (b) As used in this section, “Federal Funds Rate” means the rate published by the Board of Governors of the Federal Reserve System in its Statistical Release H.15 Selected Interest Rates and in effect as of the first day of the month immediately preceding the month during which the loan is consummated. If the Federal Reserve System ceases publication of the federal funds rate, the commissioner shall designate a substantially equivalent index. (c) The following rules shall also apply to finance lenders that make loans subject to this section: (1) The finance lender shall report each borrower’s payment performance to at least one consumer reporting agency that compiles and maintains files on consumers on a nationwide basis. For purposes of this section, a consumer reporting agency that compiles and maintains files on consumers on a nationwide basis is one that meets the definition in Section 603(p) of the federal Fair Credit Reporting Act (15 U.S.C. Sec. 1681a(p)). (A) A finance lender that is licensed under this division prior to January 1, 2020, and that is not approved as a data furnisher prior to January 1, 2020, by at least one of the consumer reporting agencies to which reporting is required pursuant to this section, shall obtain that approval by July 1, 2020, and, once approved, shall report borrower payment performance to that consumer reporting agency in connection with all loans originated under this section on and after January 1, 2020. (B) A newly licensed finance lender that is not approved as a data furnisher by at least one of the consumer reporting agencies to which reporting is required pursuant to this section shall have up to one calendar year in which to obtain that approval and, once approved, shall report borrower payment performance to that consumer reporting agency in connection with all loans originated under this section on and after the lender’s date of licensure. (2) Before disbursing loan proceeds to a borrower, the finance lender shall either offer the borrower a credit education program or seminar that has previously been reviewed and approved by the commissioner for use in complying with this section or offer the borrower a credit education program or seminar provided by an independent third party, which has previously been reviewed and approved by the commissioner for use in complying with this section. A credit education program or seminar may be provided in writing, electronically, or orally, but, if provided orally, shall be accompanied by written or electronic materials that a prospective borrower can retain or access following the conclusion of the program or seminar. (3) To be eligible for approval by the commissioner for use in complying with this section, a credit education program or seminar shall, at a minimum, cover all of the following topics regarding credit scores and credit reports provided by consumer reporting agencies described in paragraph (1): (A) The value of establishing a credit score. (B) Ways to establish a credit score. (C) Ways to improve a credit score. (D) Factors that impact a credit score. (E) Ways to check one’s credit score. (F) Ways to obtain a free copy of one’s credit report. (G) Ways to dispute an error in one’s credit report. (4) A credit education program or seminar offered pursuant to this section shall be offered at no cost to the borrower. (5) A borrower shall not be required to participate in a credit education program or seminar offered by a lender or independent third party. (Added by Stats. 2019, Ch. 708, Sec. 5. (AB 539) Effective January 1, 2020.)
  174. 22305.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    A licensee may charge an administrative fee on certain loans, but the fee is capped and limited by loan size and refinancing rules.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22305. In addition to the charges authorized by Section 22303, 22304, or 22304.5, a licensee may contract for and receive an administrative fee, which shall be fully earned immediately upon making the loan, with respect to a loan of a bona fide principal amount of not more than two thousand five hundred dollars ($2,500) at a rate not in excess of 5 percent of the principal amount (exclusive of the administrative fee) or fifty dollars ($50), whichever is less, and with respect to a loan of a bona fide principal amount in excess of two thousand five hundred dollars ($2,500), at an amount not to exceed seventy-five dollars ($75). No administrative fee may be contracted for or received in connection with the refinancing of a loan unless at least one year has elapsed since the receipt of a previous administrative fee paid by the borrower. Only one administrative fee may be contracted for or received until the loan has been repaid in full. For purposes of this section, “bona fide principal amount” shall be determined in accordance with Section 22251. (Amended by Stats. 2019, Ch. 708, Sec. 6. (AB 539) Effective January 1, 2020.)
  175. 22306.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    A person may not charge, contract for, or receive any amount above what this article allows, and combined charges by the finance lender, broker, and any other person may not exceed the article’s maximum rate.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22306. No amount in excess of that allowed by this article shall be directly or indirectly charged, contracted for, or received by any person, and the total charges of the finance lender and broker and any other person in the aggregate shall not exceed the maximum rate provided for in this article. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  176. 22307.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    Loans under this division must have charges calculated as a monthly percentage of unpaid principal, based on actual days elapsed, and loan contracts must set repayment in substantially equal installments with the first due between 15 days and 1 month 15 days after the loan date, subject to stated exceptions.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22307. (a) Except as provided in Section 22305 and Article 4 (commencing with Section 22400), all charges on loans made under this division shall be computed and paid only as a percentage per month of the unpaid principal balance or portions thereof, and shall be so expressed in every obligation signed by the borrower. The charges on loans shall be computed on the basis of the number of days actually elapsed. For the purpose of these computations, a month is any period of 30 consecutive days. (b) The loan contract shall provide for payment of the aggregate amount contracted to be paid in substantially equal periodical installments, the first of which shall be due not less than 15 days nor more than one month and 15 days from the date the loan is made. This subdivision shall not apply to a loan made to a graduate student at an accredited college or university while the student is actively pursuing a study program leading to a postbaccalaureate degree, or to a student loan made by an eligible lender under the Higher Education Act of 1965, as amended (20 U.S.C. Sec. 1070 et seq.), or to a student loan made pursuant to the Public Health Service Act, as amended (42 U.S.C. Sec. 294 et seq.). (c) This section shall not apply to open-end loans. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  177. 22307.5.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    A licensee may not charge, impose, or receive a penalty for paying off a loan early.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22307.5. A licensee shall not charge, impose, or receive any penalty for the prepayment of a loan. This section does not apply to a loan secured by real property. (Added by Stats. 2019, Ch. 708, Sec. 7. (AB 539) Effective January 1, 2020.)
  178. 22308.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    A licensee may charge interest in a specified way, but if a borrower prepays in full on or before the third installment date, the charges must be recomputed.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22308. Notwithstanding Section 22307, a licensee may contract for and receive charges on the unpaid principal balance at a single annual percentage rate, applied on the basis of the number of days actually elapsed, if the annual rate would produce a finance charge at the maturity of the contract not in excess of the finance charge resulting from the application of the graduated rates specified in Section 22303, when the loan is paid according to its terms, and charges are computed on the basis that a month is any period of 30 consecutive days, as provided in Section 22307; provided, however, that if prepayment in full occurs on or before the third installment date, all charges shall be recomputed as a percentage per month of the unpaid principal balance or portions thereof, based on the number of days actually elapsed. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  179. 22309.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section limits advance charges on covered loans, allows one narrow inclusion of prior unpaid interest in a new loan, defines unpaid principal balance for precomputed loans, and requires the licensee to deliver the loan amount and note to the borrower (or someone the borrower directs) when the loan is made.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22309. Except as provided in Section 22305 and Article 4 (commencing with Section 22400), no charges on loans made pursuant to this division shall be paid, deducted, or received in advance, or compounded. However, if part or all of the consideration for a new loan contract is the unpaid balance of a prior loan, the principal amount payable under the new loan contract may include any unpaid interest that has accrued on the prior loan. The unpaid principal balance of a precomputed loan is the balance due after refund or credit of unearned interest as provided in Section 22400. At the time of making the loan, the licensee shall deliver to the borrower, or, at the direction of the borrower, deliver to another person, an amount equal to the face value of the loan and the note evidencing the loan. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  180. 22310.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    A required loan rebate or refund does not have to be made if the total amount is under $1, except in certain actions or commissioner acts; a licensee may not structure payments to avoid that small rebate or refund.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22310. (a) Except for a rebate or refund pursuant to any administrative, civil, or criminal action, or any act of the commissioner, a rebate or refund required to be made upon payment in full of a loan pursuant to this division need not be made if the aggregate of all rebates or refunds required in connection with a loan is less than one dollar ($1). (b) No licensee shall contract for or receive any payment required in connection with a loan for the purpose of avoiding a rebate or refund of less than one dollar ($1). (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  181. 22311.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    People connected to making a regulated loan may not require the borrower to buy something else as a condition of the loan.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22311. No person in connection with or incidental to the making of any loan regulated by this division may require the borrower to contract for purchase, or agree to purchase, any other thing in connection with the loan. A policy of insurance of the type specified in Section 22313 and credit life and disability insurance is not prohibited by this section. A policy of insurance of the type defined by subdivision (a) of Section 12640.02 of the Insurance Code shall not be deemed to be a collateral sale, purchase, or agreement within the terms of this section or of Section 22201 or 22312. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  182. 22312.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    A lender-related person may not require a borrower to sign extra collateral sales agreements or contracts when making a loan, except for specified security instruments and certain insurance.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22312. No person in connection with or incidental to the making of a loan shall require the borrower to enter into any collateral sales agreements or contracts, other than the contract of pledge, assignment, or mortgage or personal property, or if otherwise permitted by this division, the deed of trust, mortgage, or lien on real property, by the borrower to the lender as security for the repayment of the loan and charges on the loan. Insurance of the type specified in Section 22313, credit life insurance, and credit disability insurance are not prohibited by this section. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  183. 22313.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section says certain insurance on property used as loan security is not treated as a collateral sale, purchase, or agreement if listed conditions are met.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22313. Insurance on tangible personal or real property offered as security shall not be deemed to be a collateral sale, purchase, or agreement within the terms of Section 22201, 22311, or 22312, when all the following requirements are met: (a) The insurance is sold at standard rates through licensed insurance brokers or agents. (b) The policy is written to cover the property that is offered as security for a loan. (c) The property is reasonably insured against loss for a reasonable term, which may be up to the term of the loan. (d) The policy relating to personal property is made payable to the borrower or any member of his or her family even though the customary mortgagee clause is attached or the mortgagee is a coassured. (e) Except in the case of purchase money encumbrances, the amount of title insurance shall not exceed the principal amount of the loan that is secured by a deed of trust, mortgage, or lien on the real property that is the subject of the policy of title insurance. (f) The policy of title insurance insures the lender or is made payable jointly to the lender and the borrower as their interests may appear. (g) Title insurance is placed through a title insurance company, duly authorized to do business in the state in which the real property is located, at rates comparable to rates being used by other title insurance companies duly authorized to do business in that state. (h) Title insurance is placed in connection with the renewal or extension of a loan only when the additional cash advance is at least one thousand dollars ($1,000). This section does not apply to any loan of a bona fide principal amount of ten thousand dollars ($10,000) or more, or to a duly licensed finance lender in connection with any such loan or loans as determined in accordance with Section 22251. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  184. 22314.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section regulates credit insurance tied to consumer loans, including when a licensee may offer it, what disclosures and approvals are required, and when the borrower must get a rebate.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22314. (a) Credit insurance shall not be deemed to be a collateral sale, purchase, or agreement within the terms of Section 22201, 22311, or 22312 when the insurance is provided in accordance with the provisions of the Insurance Code and this section. As used in this division: (1) “Credit insurance” means credit life, disability, and loss-of-income insurance, or any combination of these coverages. (2) “Credit life insurance” and “credit disability insurance” have the same meanings as defined in Section 779.2 of the Insurance Code. (3) “Credit loss-of-income insurance” means insurance issued to provide indemnity for payments becoming due on a specific loan or other credit transaction while the debtor is involuntarily unemployed, as defined in the policy. (b) A licensee may provide credit insurance with the borrower’s consent, the form to be approved by the Insurance Commissioner, and a copy, together with evidence of its approval by the Insurance Commissioner, and a copy of the schedule of rates together with evidence of its approval by the Insurance Commissioner, to be filed with the commissioner prior to the offer or sale of the credit insurance and in an amount not in excess of the amount of the indebtedness, and, with respect to credit life or disability insurance, may collect from the borrower an amount not in excess of that permitted by or pursuant to Section 779.36 of the Insurance Code. (c) If the loan is prepaid in full by cash, a new loan, refinancing, or otherwise (except by that insurance) before the final installment date, the borrower shall receive a rebate of that amount computed in accordance with the formula approved by the Insurance Commissioner pursuant to Section 779.14 of the Insurance Code. (d) When charges for the loan are precomputed in accordance with Section 22400, any permitted deferment charge may be computed on the combined total of the precomputed charge and the credit insurance charge. Only one deferment charge may be collected in connection with any loan contract, irrespective of the number of borrowers, and only one borrower need be insured. The amount of the deferment charge may be deducted from the principal of the loan. (e) If life or disability insurance is provided, and if the insured borrower dies or becomes disabled during the term of the loan contract, the insurance shall be sufficient to pay the total amount due on the loan, excluding unearned charges, outstanding on the date of death, or all amounts that become due on the loan during the period of disability, as the case may be, without any exception, reservation, or limitation, subject, however, to the provisions of Section 22315. (f) Any credit insurance provided shall be in force as soon as the loan is made. A licensee shall not require credit insurance as a condition of making a loan. (g) If a borrower procures credit insurance by or through a licensee, the statement required by Section 22338 shall disclose the cost of the credit insurance to the borrower, and the licensee shall deliver or cause to be delivered to the borrower a copy of the policy, certificate, or other evidence thereof, within a reasonable time. In the event a licensee provides credit disability or loss-of-income insurance pursuant to this division, the licensee shall also deliver an understandable written statement to the borrower detailing the conditions under which the borrower will be entitled to make a claim under the insurance policy and the procedure to be followed in making the claim. This statement shall be first approved by the Insurance Commissioner. (h) The amount charged to the borrower for credit life or disability insurance shall not exceed the amount established by or pursuant to Section 779.36 of the Insurance Code. (i) Nothing in this article shall prevent a licensee from selling insurance as other business if authorized by Section 22154. This section does not apply to any loan of a bona fide principal amount of ten thousand dollars ($10,000) or more, or to a duly licensed finance lender in connection with any such loan or loans as determined in accordance with Section 22251. (Amended by Stats. 1996, Ch. 107, Sec. 1. Effective January 1, 1997.)
  185. 22315.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

    Verify source ↗

    This section sets rules for credit disability insurance, including minimum disability periods, retroactive coverage, premium disclosure, payment calculation, and limits tied to the loan term and loan size.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22315. (a) Credit disability insurance written pursuant to Section 22314 shall not provide indemnity against the risk that the borrower will become disabled for a period of less than 14 days. The insurance may provide indemnity for any single period of continuous disability of 14 days or longer, after which the risk may become compensable. The insurance may be offered with retroactive coverage to an earlier date based upon the disability having continued for a period stated in the policy, but if insurance with retroactive coverage is offered, it shall also be offered without retroactive coverage, and the premium rate for each coverage shall be separately stated in writing to the borrower. (b) If insurance with retroactive coverage is provided, the coverage shall provide for a prorated payment based upon the fraction of the month during which the insured is disabled, provided that the insured is continuously disabled during the waiting period set forth in the policy. If insurance without retroactive coverage is provided, the coverage shall provide for a prorated payment based upon the fraction of the month during which the insured is disabled, after first excluding the elimination period set forth in the policy. For the purpose of this subdivision, a month is any period of 30 consecutive days. (c) Credit disability insurance, if made available by a licensee, shall be available on a monthly or annual premium basis, and the premium by the month shall not exceed a pro rata relationship to the annual premium. Credit disability insurance need not be offered for a period less than the term of the loan to which it is applicable, and no credit disability insurance shall be written for a period in excess of the term of the loan to which it is applicable. (d) The monthly disability benefit payable with respect to an open-end loan shall not exceed the monthly payment computed pursuant to Section 22453 on the outstanding balance at the time disability is incurred. This section does not apply to any loan of a bona fide principal amount of ten thousand dollars ($10,000) or more, as determined in accordance with Section 22251. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  186. 22316.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A licensee may charge for a lot book report bought instead of the title insurance described in Section 22313.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22316. A licensee may collect the cost of a lot book report purchased in lieu of the title insurance provided for in Section 22313. The cost is not included in charges as defined in this division or in determining the maximum charges that may be made under this article. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  187. 22317.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A licensee may charge an appraisal fee for a real-property-secured loan, but only if a written appraisal from a qualified appraiser is provided, and the fee cannot exceed the actual appraisal cost.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22317. On any loan made that is secured by real property, an appraisal fee not to exceed the actual cost of the appraisal may be charged by the licensee if a written appraisal is provided to the licensee by a qualified appraiser. Only one fee for appraising the same real property may be collected unless the borrower has obtained a new or additional loan and more than one year has elapsed since the prior appraisal. The fee is not included in charges as defined in this division or in determining the maximum charges that may be made under this article. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  188. 22317.2.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A licensee may charge a limited fee for a third-party automated valuation model result, but must give the borrower notice and, if requested in time, provide a copy within set deadlines.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22317.2. (a) A licensee may collect a fee for use of an automated valuation model result prepared by a third party not to exceed the actual cost paid to the third party for a written automated valuation model result in lieu of the appraisal provided for in Section 22317. The borrower shall not be charged for both an automated valuation model result and an appraisal as defined in Section 22317 for the same property in a single transaction. Only one fee for providing an automated valuation model result or an appraisal for the same real property may be collected unless the borrower has obtained a new or additional loan and more than one year has elapsed since the prior delivery of an automated valuation model result or an appraisal. However, if a fee for an automated valuation model result has been paid, an appraisal fee minus the amount that has been paid by the borrower for the automated valuation model result may be charged for an appraisal for the same real property within one year if the borrower has obtained a new or additional loan. The fee is not included in charges as defined in this division or in determining the maximum charges that may be made under this article. (b) A licensee in a loan transaction secured by real property shall provide notice as described in this section to a borrower of the borrower’s right to receive a copy of the automated valuation model result, provided he or she has paid a fee for the automated valuation model result. A borrower’s written request for a copy of an automated valuation model result shall be received by the licensee no later than 90 days after (1) the licensee has provided notice of the action taken on the application, including a notice of incompleteness, or (2) the application has been withdrawn. (c) The licensee shall mail or deliver a copy of an automated valuation model result within 15 days after receiving a written request from the borrower, or within 15 days after receiving the automated valuation model result, whichever occurs later. (d) Where the loan is proposed to be secured by real property, the notice of the borrower’s right to a copy of the automated valuation model result shall be given in at least 10-point boldface type, as a separate document in a form that the borrower may retain, and no later than 15 days after the licensee receives the written application. The notice shall specify that the borrower’s request for the automated valuation model result must be in writing and must be received by the licensee no later than 90 days after the licensee provides notice of the action taken on the application or a notice of incompleteness, or in the case of a withdrawn application, 90 days after the withdrawal. The notice shall also include the following statement: “An automated valuation model is not an appraisal. It is a computerized property valuation system that is used to derive a real property value.” An address to which the request should be sent shall be specified in the notice. Release of the automated valuation model result to the borrower may be conditioned upon payment of the fee. (e) This section does not apply to automated valuation model results obtained by licensees on property owned by the licensee, nor to automated valuation model results obtained by the licensee in anticipation of modifying any existing loan agreement if the licensee does not charge for the use of the automated valuation model result. (f) For purposes of this section, an “automated valuation model” is a computerized property valuation system that is used to derive a real property value. (g) Nothing in this section authorizes the use of an automated valuation model result in lieu of an appraisal that is required under state or federal law. (Added by Stats. 2006, Ch. 356, Sec. 1. Effective January 1, 2007.)
  189. 22317.5.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A licensee must not do certain things on loans secured by real property.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22317.5. On any loan secured by real property, a licensee may not do either of the following: (a) Fail to disburse funds in accordance with a commitment to make a loan that is accepted by the applicant. (b) Intentionally delay the closing of a loan for the sole purpose of increasing interest, costs, fees, or charges payable by the borrower. (Added by Stats. 2004, Ch. 940, Sec. 4. Effective January 1, 2005.)
  190. 22318.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A reasonable escrow fee may be charged on loans secured by real property.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22318. On any loan made that is secured by real property, an escrow fee of a reasonable amount may be charged. The fee shall be considered reasonable when paid to a company licensed to do business under the Escrow Law (Division 6 (commencing with Section 17000)), or any person exempted by the Escrow Law, provided that the fees are comparable to fees charged by escrow companies authorized to do business in this state. The fee is not included in charges defined in this division in determining the applicable maximum charges that may be made under this article. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  191. 22319.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    For a real-property-secured loan, the licensee may collect the trustee’s reconveyance fee to pass it on to the trustee, and that fee is excluded from certain charge limits.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22319. On any loan that is secured by real property, the fee to be paid to the trustee for reconveyance of the trust deed may be collected by the licensee for transmittal to the trustee. The fee is not included in charges defined in this division or in determining the applicable maximum charges that may be made under this article. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  192. 22320.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A licensee may charge and collect up to $15 for the return of a dishonored check, negotiable order of withdrawal, or share draft on a loan under this division.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22320. With respect to a loan under this division, a fee not to exceed fifteen dollars ($15) for the return by a depository institution of a dishonored check, negotiable order of withdrawal, or share draft may be charged and collected by the licensee. The fee is not included in charges defined in this division or in determining the applicable maximum charges that may be made under this article. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  193. 22320.5.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A licensee may charge a delinquency fee only within the stated limits, and may not collect it more than once for the same default.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22320.5. (a) A licensee may contract for and receive a delinquency fee not in excess of one of the following amounts: (1) For a period in default of not less than 10 days, an amount not in excess of ten dollars ($10). (2) For a period in default of not less than 15 days, an amount not in excess of fifteen dollars ($15). (b) The delinquency fee may not be collected more than once for the same default and may be collected at the time of the default or at any time thereafter. If the delinquency fee is deducted from any payment received after default occurs, and the deduction results in the default of a subsequent installment, no fee may be collected for the resulting default. The delinquency fee under this section is not included in charges defined in this division or in determining applicable maximum charges that may be made under this article. (c) For open-end loans made under Article 5 (commencing with Section 22450), a licensee shall not collect or receive the delinquency fee set forth in subdivision (a) unless there is a minimum of 20 days, inclusive, between the monthly billing date and the date upon which the minimum payment is due, exclusive of the applicable grace period provided in subdivision (a). (d) This section shall not apply to precomputed loans as described in Section 22400. (Added by Stats. 1998, Ch. 104, Sec. 2. Effective January 1, 1999.)
  194. 22321.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    If credit loss-of-income insurance is offered under this division, it must follow specific disclosure, cancellation, benefit, and payment rules.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22321. If credit loss-of-income insurance is provided pursuant to this division, it shall be subject to the following conditions: (a) The insurance shall provide indemnity in accordance with the terms of the policy after any single period of continuous unemployment of 45 days or less as determined by the policy, after which benefits shall commence. The insurance may be offered with retroactive coverage to an earlier date based upon unemployment having continued for the period stated in the policy. (b) The statement required by Section 22337 shall include disclosure of the term of the coverage, the conditions of coverage, the benefits to be paid, and the exclusions from coverage. (c) The borrower shall sign a certificate of voluntary acceptance of any credit loss-of-income insurance purchased. The certificate shall state in boldface type that is larger than the type used in the loan contract that purchase of the insurance is not a necessary condition of receiving the loan, and that the insurance may be canceled by the borrower at any time within 15 days after it goes into effect. If the borrower cancels the insurance within 15 days, a full refund shall be made of the premium paid. (d) The minimum benefit shall be payment up to the agreed amount on not less than four benefit payments, as stated in the policy, which accrue during a covered period of unemployment, except that during the first 60 days after inception of the policy, the minimum benefit may be payment up to the agreed amount of one-half the number of benefit payments, as stated in the policy, which accrue during a covered period of unemployment. The maximum benefits shall be established in the contract of insurance. (e) If combination credit disability and credit loss-of-income coverage is offered, credit disability and credit loss-of-income coverage shall also be offered separately. (f) Benefits may not be denied because the insured cannot establish a valid claim for unemployment compensation benefits under Part 1 (commencing with Section 100) of Division 1 of the Unemployment Insurance Code solely because the former employer was not required to contribute to the State Unemployment Fund. (g) If insurance with retroactive coverage is provided, the coverage shall provide for a prorated payment based upon the fraction of the month during which the insured is unemployed, provided that the insured is continuously unemployed during the waiting period set forth in the policy. If insurance without retroactive coverage is provided, the coverage shall provide for a prorated payment based upon the fraction of the month during which the insured is unemployed, after first excluding the elimination period set forth in the policy. For the purpose of this subdivision, a month is any period of 30 consecutive days. (h) When unemployment continues for a number of months equal to or greater than the maximum number of benefit payments stated in the policy, the final payment shall be equal to the difference between a benefit payment and the initial prorated payment. (i) As used in this section, “benefit payment” means payment of an amount equal to a loan repayment installment or a maximum amount established in the contract of insurance, whichever is less. (j) The minimum benefit payment offered may not be less than the amount of a loan repayment installment unless the borrower or borrowers have two or more sources of income. If the maximum benefit payment offered is less than the amount of a loan repayment installment, the borrower shall also be offered coverage in which the maximum benefit payment is equal to the amount of a loan repayment installment. This section does not apply to any loan of a bona fide principal amount of ten thousand dollars ($10,000) or more, or to a duly licensed finance lender in connection with any such loan or loans as determined in accordance with Section 22251. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  195. 22322.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A loan made outside California may be enforced in California, but only within the limits described here.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22322. A loan lawfully made outside the state may be enforced in this state as to the unpaid principal balance of the loan together with the interest, consideration, brokerage, and all other charges, to the extent of but not to exceed the unpaid principal balance and the aggregate amount of interest, consideration, brokerage, and all other charges permitted by this division in connection with a loan of the same amount made within this state. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  196. 22323.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A person collecting in California an out-of-state loan balance is subject to this division if the collection involves more interest, consideration, brokerage, or other charges than allowed for a same-size loan made in California.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22323. Any person who collects or attempts to collect in this state the unpaid principal balance of a loan made outside the state and a greater aggregate amount of interest, consideration, brokerage, and all other charges in connection with the loan than is permitted by this division in connection with a loan of the same amount made within this state, is subject to the provisions of this division. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  197. 22324.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A person who arranges or negotiates an in-state loan for an out-of-state loan made to evade this division is treated as subject to this division.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22324. Any person who contracts for or negotiates in this state a loan to be made outside the state for the purpose of evading or avoiding the provisions of this division is subject to the provisions of this division. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  198. 22325.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    Each licensee must prominently display a full and accurate schedule of charges and how those charges are computed at each licensed place of business.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22325. Every licensee shall display prominently in each licensed place of business a full and accurate schedule of the charges to be made and the method of computing the charges. The schedule is subject to the approval of the commissioner. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  199. 22326.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A person may not charge or collect more than the allowed interest or other consideration on covered loans, unless authorized by this division.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22326. No person, except as authorized by this division, shall directly or indirectly charge, contract for, or receive any interest, discount, or consideration greater than the lender would be permitted by law to charge if he or she were not a licensee hereunder, upon the loan, use, or forbearance of money, goods, or things in action, or upon the loan, use, or sale of credit. This section applies to any person, who by any device, subterfuge, or pretense charges, contracts for, or receives greater interest, consideration, or charges than is authorized by this division for any loan, use, or forbearance of money, goods, or things in action or for any loan, use, or sale of credit. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)
  200. 22327.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. )

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    A licensee must not steer borrowers into splitting a loan or using multiple loan contracts with the same licensee to obtain a higher charge, except where federal law requires it.

    ## Financial Code - FIN ## DIVISION 9. CALIFORNIA FINANCING LAW [22000 - 22780.1] ( Heading of Division 9 amended by Stats. 2017, Ch. 475, Sec. 3. ) ## CHAPTER 2. Consumer Loans [22200 - 22470] ( Chapter 2 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## ARTICLE 3. Loan Regulations [22300 - 22347] ( Article 3 added by Stats. 1994, Ch. 1115, Sec. 2. ) ## 22327. No licensee shall knowingly induce any borrower to split up or divide any loan with any other licensee. No licensee shall induce or permit any borrower to be or to become obligated directly or indirectly, or both, under more than one contract of loan at the same time with the same licensee for the purpose or with the result of obtaining a higher rate of charge than would otherwise be permitted by this article, except as otherwise required by the federal Equal Credit Opportunity Act (15 U.S.C. Sec. 1691 et seq.; Public Law 93-495) and Regulation B promulgated by the Board of Governors of the Federal Reserve System (12 C.F.R. 202 et seq.). For the purpose of this section, “borrower” includes any spouses, whether jointly or severally obligated. (Amended by Stats. 2016, Ch. 50, Sec. 40. (SB 1005) Effective January 1, 2017.)

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