NORTH CAROLINA GENERAL ASSEMBLY
1979 SESSION
CHAPTER 706
SENATE BILL 596
AN ACT TO AMEND VARIOUS CREDIT LAWS TO SPECIFICALLY INCLUDE MAIL ORDER TRANSACTIONS.
Whereas, the Retail Installment Sales Act does not expressly set forth provisions concerning the application of the act to transactions which may involve a buyer located in this State and a seller in another state; and
Whereas, the provisions of Consumer Finance Act which define the scope of the act to out-of-State companies are somewhat ambiguous; and
Whereas, the interest and usury laws of North Carolina do not expressly set forth provisions concerning the application of those laws to transactions involving borrowers located in this State and lenders located in another state; and
Whereas, it is the purpose of this bill to set forth specifically the application of North Carolina laws to certain transactions in which some, but not all of the parties reside in North Carolina; Now, therefore,
The General Assembly of North Carolina enacts:
Section 1. G.S. 25A-2 is hereby amended by adding a new subsection (d) to read as follows:
"(d) For the purposes of this Chapter, a consumer credit sale shall be deemed to have been made in this State, and therefore subject to the provisions of this Chapter, if the seller offers or agrees in this State to sell to a buyer who is a resident of this State, or if such buyer accepts or makes the offer in this State to buy, regardless of the situs of the contract as specified therein.
Any solicitation or communication to sell, oral or written, originating outside of this State, but forwarded to and received in this State by a buyer who is a resident of this State, shall be deemed to be an offer or agreement to sell in this State.
Any solicitation or communication to buy, oral or written, originating within this State, from a buyer who is a resident of this State, but forwarded to and received by a retail seller outside of this State, shall be deemed to be an acceptance or offer to buy in this State."
Sec. 2. G.S. 53-190 is rewritten as follows:
"(a) No loan contract made outside this State in the amount or of the value of three thousand dollars ($3,000) or less, for which greater consideration or charges than are authorized by G.S. 53-173 of this Article have been charged, contracted for, or received, shall be enforced in this State. Provided, the foregoing shall not apply to loan contracts in which all contractual activities, including solicitation, discussion, negotiation, offer, acceptance, signing of documents, and delivery and receipt of funds, occur entirely outside North Carolina.
(b) If any lender or agent of a lender who makes loan contracts outside this State in the amount or of the value of three thousand dollars ($3,000) or less, comes into this State to solicit or otherwise conduct activities in regard to such loan contracts, then such lender shall be subject to the requirements of this Article.
(c) No lender licensed to do business under this Article may collect, or cause to be collected, any loan made by a lender in another state to a borrower, who was a legal resident of North Carolina at the time the loan was made. The purchase of a loan account shall not alter this prohibition."
Sec. 3. Chapter 24 of the General Statutes is amended by adding a new section, designated G.S. 24-2.1, to read as follows:
"§ 24-2.1. Transactions governed by Chapter. — For purposes of this Chapter, any extension of credit shall be deemed to have been made in this State, and therefore subject to the provisions of this Chapter if the lender offers or agrees in this State to lend to a borrower who is a resident of this State, or if such borrower accepts or makes the offer in this State to borrow, regardless of the situs of the contract as specified therein.
Any solicitation or communication to lend, oral or written, originating outside of this State, but forwarded to and received in this State by a borrower who is a resident of this State, shall be deemed to be an offer or agreement to lend in this State.
Any solicitation or communication to borrow, oral or written, originating within this State, from a borrower who is a resident of this State, but forwarded to, and received by a lender outside of this State, shall be deemed to be an acceptance or offer to borrow in this State."
Sec. 4. This act shall become effective on July 1, 1979.
In the General Assembly read three times and ratified, this the 30th day of May, 1979.