H. B. 2958
(By Delegates Susman and Mahan)
[Introduced February 26, 1999; referred to the
Committee on Banking and Insurance then Finance.]
A BILL to amend and reenact section thirty, article four, chapter
thirty-one-a of the code of West Virginia, one thousand nine
hundred thirty-one, as amended, relating to prohibiting
banks from charging fees for payoff or balance inquiries
unless the inquiries exceed three within a thirty-day
period; requiring banks to provide information in response
to a balance or payoff inquiry within two business days; and
providing that the term "banking institution" applies to
lenders who make or service loans or who hold a security
interest in property located in the state.
Be it enacted by the Legislature of West Virginia:
That section thirty, article four, chapter thirty-one-a of
the code of West Virginia, one thousand nine hundred thirty-one,
as amended, be amended and reenacted to read as follows:
ARTICLE 4. BANKING INSTITUTIONS AND SERVICES GENERALLY.
§31A-4-30. Charges and interest allowed in certain cases;
negotiability of installment notes.
(a) In addition to the interest rate provided in article
six, chapter forty-seven of this code and elsewhere by law, a
banking institution may charge interest together with other
finance charges at a rate of eighteen percent per annum or less
calculated according to the actuarial method, or one and one-half
percent per month, computed on unpaid balances. Additional
charges in connection with consumer loans are limited as provided
in section one hundred nine, article three, chapter forty-six-a
of this code. Loans may be made on a precomputed basis:
Provided, That upon prepayment in full of a precomputed loan, the
bank shall rebate the unearned portion of such finance charges as
specified in section five-d, article six, chapter forty-seven of
this code. Any note evidencing any such installment loan may
provide that the entire unpaid balance thereof at the option of
the holder shall become due and payable upon default in the
payment of any stipulated installment without impairing the
negotiability of such note if otherwise negotiable.
(b) A banking institution may not charge a borrower or the
borrower's agent for a balance inquiry or payoff inquiry:
Provided, That if a borrower or his or her agent makes in excess
of three requests within a thirty-day period, the banking
institution may charge a minimal fee.
(c) Upon receiving a request for a payoff on balance
inquiry, the banking institution shall provide the information
requested within two business days.
(d) For the purposes of subsections (b) and (c) of this
section, the term "banking institution" shall, to the degree
permitted under federal law, apply to any lender which makes or
services loans in this state or takes or holds a security
interest in property located in this state.
NOTE: The purpose of this bill is to prohibit banks from
charging fees for payoff or balance inquiries unless the
inquiries exceed three within a thirty-day period. The bill also
requires banks to provide information in response to a balance or
payoff inquiry within two business days. Finally, it provides
that the term "banking institution" applies to lenders who make
or service loans or who hold a security interest in property
located in the state.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.
Section 408 is new; therefore, strike-throughs and
underscoring have been omitted.