GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 1991

CHAPTER 765
HOUSE BILL 277

AN ACT TO CLARIFY AND FURTHER REGULATE OTHER BUSINESS AUTHORITY UNDER THE NORTH CAROLINA CONSUMER FINANCE ACT.

The General Assembly of North Carolina enacts:

Section 1.  G.S. 53-172 reads as rewritten:
"§ 53-172.  Conduct of other business in same office.
(a)	No licensee shall conduct the business of making loans under this Article within any office, suite, room, or place of business in which any other business is solicited or transacted.
Installment paper dealers as defined in G.S. 105-83, and the collection by a licensee of loans legally made in North Carolina, or another state by another government regulated lender or lending agency, shall not be considered as being any other business within the meaning of this section.
(b)	Notwithstanding subsection (a) of this section, the Commissioner may authorize in writing the solicitation and transaction of other business in any office, suite, room, or place of business in which a licensee is conducting the business of making loans if the Commissioner determines that the other business would not be contrary to the best interests of the borrowing public.
(c)	The Commissioner may require, consistent with the provisions of 12 C.F.R. Part 226 (Regulation Z) of the federal Truth-In-Lending Act, the other business authorized under subsection (b) of this section to:
(1)	Disclose the cost of consumer credit of goods and services sold; and
(2)	Provide the purchaser with a reasonable cancellation period for goods and services purchased.
(d)	No licensee shall:
(1)	Make the purchase of goods and services sold under the authorization of subsection (b) of this section a condition of making a loan; or
(2)	Consider the borrower's decision to purchase, or not purchase, goods and services sold under the authorization of subsection (b) of this section a factor in its approval or denial of credit, or in its determination of the amount of or terms of credit for the borrower.
(e)	The licensee shall notify the borrower in writing that the purchase of the goods and services offered under the authorization under subsection (b) of this section is voluntary and that the borrower's decision whether or not to purchase the goods and services will not affect the licensee's decision to grant credit or the amount of or terms of the credit granted.
(f)	If, at any time, the Commissioner has reason to believe that the conduct of any other business authorized under this section is contrary to the best interests of the borrowing public, the Commissioner shall hold a hearing pursuant to Chapter 150B of the General Statutes to determine whether or not to revoke the authority to conduct that business.  The Commissioner shall revoke the authority to conduct any other business if he or she finds that the conduct of any other business authorized under this section is contrary to the best interests of the borrowing public.
(g)	This section shall not be construed as authorizing the collection of any loans or charges in violation of the prohibitions contained in G.S. 53-190.
(h)	The books, records, and accounts relating to loans shall be kept in such manner as the Commissioner of Banks prescribes as to delineate clearly the loan business from any other business authorized by the Commissioner."
Sec. 2.  G.S. 53-178 reads as rewritten:
"§ 53-178.  No further charges; no splitting contracts; certain contracts void.
No further or other charges or insurance commissions shall be directly or indirectly contracted for or received by any licensee except those specifically authorized by this Article or by the Commissioner under G.S. 53-172. No licensee shall divide into separate parts any contract made for the purpose of or with the effect of obtaining charges in excess of those authorized by this Article. All balances due to a licensee from any person as a borrower or as an endorser, guarantor or surety for any borrower or otherwise, or due from any husband or wife, jointly or severally, shall be considered a part of any loan being made by a licensee to such person for the purpose of computing interest or charges."
Sec. 3.  This act is effective upon ratification.
In the General Assembly read three times and ratified this the 16th day of June, 1992.

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Henson P. Barnes
President Pro Tempore of the Senate

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Daniel Blue, Jr.
Speaker of the House of Representatives