§ 26.1-37-02 — Definitions

For the purposes of this chapter:
1. "Closed-end credit" means a credit transaction that does not meet the definition of
open-end credit.
2. "Collateral" means personal property that is pledged as security for the satisfaction of
a debt.
3. "Consumer credit insurance" is a general term used in this chapter to refer to any or all
of credit life insurance, credit accident and health insurance, credit unemployment
insurance, credit property, or any other credit insurance.
4. "Credit accident and health insurance" means insurance on a debtor to provide
indemnity for payments becoming due on a specific loan or other credit transaction
while the debtor is disabled as defined in the policy.
5. "Credit agreement" means the written document that sets forth the terms of the credit
transaction and includes the security agreement.
6. "Credit life insurance" means insurance on a debtor or debtors, pursuant to or in
connection with a specific loan or other credit transaction, to provide for satisfaction of
a debt, in whole or in part, upon the death of an insured debtor.
7. "Credit property insurance" means any policy, endorsement, rider, binder, certificate, or
other instrument or evidence of insurance covering perils to goods purchased through
a credit transaction or used as collateral for a credit transaction and which concerns a
creditor's interest in the purchased goods or pledged collateral either in whole or in
part.
8. "Credit transaction" means any transaction by the terms of which the repayment of
money loaned or loan commitment made, or payment for goods, services, or
properties sold or leased, is to be made at a future date or dates.
9. "Credit unemployment insurance" means insurance on a debtor to provide indemnity
for payments or debt becoming due on a specific loan or other credit transaction while
the debtor is involuntarily unemployed as defined in the policy.
10. "Creditor" means the lender of money or vendor or lessor of goods, services, or
property, rights, or privileges, for which payment is arranged through a credit
transaction, or any successor to the right, title, or interest of the lender, vendor, or
lessor, and an affiliate, associate, or subsidiary of any of them or any director, officer,
or employee of any of them, or any other person in any way associated with any of
them.

11. "Creditor-placed insurance" means insurance that is purchased unilaterally by the
creditor, who is the named insured, subsequent to the date of the credit transaction,
providing coverage against loss, expense, or damage to the collateralized personal
property as a result of fire, theft, collision, or other risks of loss that would either impair
a creditor's interest or adversely affect the value of collateral covered by dual interest
insurance. It is purchased according to the terms of the credit agreement as a result of
the debtor's failure to provide required physical damage insurance, with the cost of the
coverage being charged to the debtor. It is either single interest insurance or limited
dual interest insurance.
12. "Debtor" means a borrower of money or a purchaser or lessee of goods, services,
property, rights, or privileges for which payment is arranged through a credit
transaction.
13. "Dual interest insurance" means credit property insurance covering the seller's or
creditor's interest and at least partially the borrower's interest in the goods purchased
through the credit transaction or pledged as collateral for the credit transaction.
14. "Finance charge" means any charge payable directly or indirectly as an incident to or
as a condition of the extension of credit, including interest; time price differentials;
amount payable under a discount system of additional charges; service, transaction, or
carrying charges; loan fees; points or similar charges; appraisal fees; or charges
incurred for investigating the creditworthiness of the consumer. The terms do not
include charges as a result of default, taxes, license fees, delinquency charges, or
filing fees.
15. "Gross debt" means the sum of the remaining payments owed to the creditor by the
debtor.
16. "Identifiable charge" means a charge for a type of consumer credit insurance that is
made to debtors having such insurance and not made to debtors not having such
insurance, and includes a charge for insurance that is disclosed in the credit or other
instrument furnished to the debtor which sets out the financial elements of the credit
transaction and any difference in the finance, interest, service, or other similar charge
made to debtors who are in like circumstances except for the insured or noninsured
status of the debtor or of the property used as security for the credit transaction.
17. "Net debt" means the amount necessary to liquidate the remaining debt in a single
lump sum payment, excluding all unearned interest and other unearned finance
charges.
18. "Open-end credit" means credit extended by a creditor under an agreement in which:
a. The creditor reasonably contemplates repeated transactions;
b. The creditor imposes a finance charge from time to time on an outstanding
unpaid balance; and
c. The amount of credit that may be extended to the debtor during the term of the
agreement, up to any limit set by the creditor, is generally made available to the
extent that any outstanding balance is repaid.