2.59.302    FEE DISCLOSURES – COMPUTATION OF INTEREST

(1) At the time of filing an application for initial license or a renewal license under the Montana Consumer Loan Act, the applicant shall file with the department a fee disclosure statement and a failure- or inability-to-pay disclosure statement, collectively referred to as "disclosure statements," unless otherwise specified.

(a) The fee disclosure statement must contain:

(i) the interest rate or range of interest rates that the licensee charges for each type of loan product offered not to exceed the maximum allowed under 32-5-301(1), MCA;

(ii) known third-party fees and reasonable estimates of unknown third-party fees allowed under 32-5-301, MCA. Consumers may not be charged more than the third party's actual fee; and

(iii) examples of the total cost to the consumer for each type of loan product offered as follows:

(A) an example using the lowest available interest rate for the loan type including all third-party fees typically charged for that loan type; and

(B) an example using the highest interest rate chargeable for the loan type including all third-party fees typically charged for that loan type.

(b) The failure- or inability-to-pay disclosure statement must contain information about fees that may be charged during the term of the loan and afterwards arising from the consumer's failure or inability to pay as agreed under the terms of the loan agreement. The fee information that must be disclosed is:

(i) insufficient funds/dishonored check or check equivalent fee under 32-5-407, MCA;

(ii) past-due fee under 32-5-301, MCA, if provided for in the contract;

(iii) deferral/extension fee under 32-5-301, MCA, if provided for in the contract; and

(iv) reasonable attorney fees under 32-5-407, MCA, if provided for in the contract and if the licensee sues the consumer in a judicial action on the loan agreement and wins.

(2) The disclosure statements must be printed in black letters and numbers on a white background using a font style and size, type face, or similar graphics to call the consumer's attention to the information.

(3) The disclosure statements may, but need not, be combined in one document.

(4) A licensee shall maintain on file with the department current disclosure statement(s) and shall not charge fees or rate(s) of interest in excess of those contained in the disclosure statements on file with the department or in excess of those authorized under Title 32, chapter 5, MCA. Currently dated, amended disclosure statements may be filed with the department at any time. Amended disclosure statements have only prospective application from the date of filing with the department. The disclosure statements in effect at the time a loan is made remain in effect for that loan until termination of the loan agreement unless:

(a) the loan is refinanced; or

(b) an express provision allowing modification of interest rate or fees during the term of the loan is contained in the loan agreement and authorized by law.

(5) A licensee shall conspicuously display the licensee's current disclosure statements at its business location(s) where loans to persons residing in Montana are negotiated or made, so as to be readily visible to prospective loan applicants before completion of a loan application begins.

(6) If a licensee conducts business through the Internet, the following information must be displayed to all online loan applicants residing in Montana on a web page that cannot be circumvented and must be viewed before completion of the loan application can begin:

(a) the licensee's name and license number (sometimes referred to as credential number or unique ID) exactly as they appear on the license; and

(b) the current disclosure statements that are filed with the department as required under this rule.

(7) A licensee shall observe the following procedures in computing interest:

(a) interest must be computed at the applicable rate on the balance of the loan from the date of the previous payment to the date of the following payment; and

(b) interest must be computed using a 365-day year, or in the case of a leap year a 366-day year, and by counting the actual number of days from one payment to the next.

(8) For purposes of implementing 32-5-301, MCA, the phrase "only once" means on the same default. A borrower who defaults in one or more installment payments may be subject to one past-due fee as specified in 32-5-301, MCA, for each installment payment on which the borrower defaulted.

History: 32-5-401, MCA; IMP, 32-5-301, MCA; Eff. 12/31/72; TRANS, from Commerce, 2001 MAR p. 1178; AMD, 2010 MAR p. 213, Eff. 1/29/10; AMD, 2013 MAR p. 666, Eff. 4/26/13; AMD, 2014 MAR p. 498, Eff. 3/14/14.