§ 537.2301 — Authority to make supervised loans

Iowa § 537.2301

• Jurisdiction: Iowa
• Title XIII: COMMERCE
• Ch. 537: CONSUMER CREDIT CODE

Text

1. As used in this part, “licensing authority” means the agency designated in chapter 524,
533, 536, or 536A to issue licenses or otherwise authorize the conduct of business pursuant to
therespectivechapterorthischapter,and“licensee”includesanypersonsubjecttoregulation
by a licensing authority. “License” includes the authorization, of whatever form, to engage in
the conduct regulated under those chapters.
2. A person who is not authorized to make supervised loans as provided in this section
shall not engage in the business of making supervised loans or undertaking direct collection
of payments from or enforcement of rights against consumers arising from supervised loans,
but the person may collect and enforce for three months without a license if the person
promptly applies for a license and the person’s application has not been denied.
3. A supervised loan made by a person in violation of subsection 2 shall be void and the
consumer is not obligated to pay either the amount financed or the finance charge. If the
consumer has paid any part of the amount financed or the finance charge, the consumer
has a right to recover the payment from the person in violation of subsection 2 or from an
assignee of that person’s rights who undertakes direct collection of payments or enforcement
ofrightsarisingfromthedebt. Withrespecttoviolationsarisingfromloansmadepursuantto
open-end credit, no action pursuant to this subsection may be brought more than two years
after the violation occurred. With respect to violations arising from other loans, no action
pursuant to this subsection may be brought more than one year after the due date of the last
scheduled payment of the agreement pursuant to which the charge was paid.
4. The following persons are authorized to make supervised loans:
a. A person who is a supervised financial organization.
b. A person who has obtained a license pursuant to either chapter 536 or 536A.
c. A person who enters into less than ten supervised loans per year in this state and has
neither an office physically located in this state nor engages in face-to-face solicitation in this
state.
5. This section shall not affect dollar amount, purpose, or rate of finance charge
restrictions imposed by any statute of this state or of the United States with respect to which
a person is authorized to make loans at a rate of finance charge in excess of that permitted
by chapter 535 or pursuant to which a person is licensed.

Legislative History

[C75, 77, 79, 81, §537.2301]