HF 2973

as introduced - 81st Legislature (1999 - 2000) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to financial institutions; regulating certain 
  1.3             loan charges and payments; making various technical 
  1.4             changes; amending Minnesota Statutes 1998, sections 
  1.5             47.59, subdivisions 7, 10, and by adding a 
  1.6             subdivision; 47.60, subdivision 2; 48.56; 56.131, 
  1.7             subdivision 4; 58.02, subdivision 10; 58.04, 
  1.8             subdivisions 2 and 3; 58.05, by adding a subdivision; 
  1.9             58.08, as amended; 58.10, subdivision 1; and 168.72, 
  1.10            by adding a subdivision; Minnesota Statutes 1999 
  1.11            Supplement, section 58.04, subdivision 1; proposing 
  1.12            coding for new law in Minnesota Statutes, chapter 58; 
  1.13            repealing Minnesota Statutes 1998, sections 58.02, 
  1.14            subdivision 15; and 58.05, subdivision 2; Minnesota 
  1.15            Rules, part 2675.4180. 
  1.16  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.17     Section 1.  Minnesota Statutes 1998, section 47.59, 
  1.18  subdivision 7, is amended to read: 
  1.19     Subd. 7.  [ADVANCES TO PERFORM COVENANTS OF BORROWER OR 
  1.20  PURCHASER.] (a) If the agreement with respect to a loan or 
  1.21  credit sale contract contains covenants by the borrower or 
  1.22  purchaser to perform certain duties pertaining to insuring or 
  1.23  preserving collateral and the financial institution according to 
  1.24  the agreement pays for performance of the duties on behalf of 
  1.25  the borrower or purchaser, the financial institution may add to 
  1.26  the debt or contract balance the amounts so advanced.  Before or 
  1.27  within a reasonable time not less more than 30 days after 
  1.28  advancing any sums, the financial institution shall state to the 
  1.29  borrower or purchaser in writing the amount of sums advanced or 
  1.30  to be advanced, any charges with respect to this amount, and any 
  2.1   revised payment schedule and, if the duties of the borrower or 
  2.2   purchaser performed by the financial institution pertain to 
  2.3   insurance, a brief description of the insurance paid for or to 
  2.4   be paid for by the financial institution including the type and 
  2.5   amount of coverages.  Additional information need not be given.  
  2.6   The actions of the financial institution pursuant to this 
  2.7   subdivision shall not be deemed to cure the borrower's failure 
  2.8   to perform covenants in the loan or credit sale contract, unless 
  2.9   the loan or credit sale contract expressly provides otherwise. 
  2.10     (b) A finance charge equal to that specified in the loan 
  2.11  agreement or credit sale contract may be made for sums advanced 
  2.12  under paragraph (a). 
  2.13     Sec. 2.  Minnesota Statutes 1998, section 47.59, is amended 
  2.14  by adding a subdivision to read: 
  2.15     Subd. 9a.  [PROMPT CREDITING OF PAYMENTS.] A financial 
  2.16  institution shall credit a payment to the consumer's account as 
  2.17  of the date of receipt. 
  2.18     Sec. 3.  Minnesota Statutes 1998, section 47.59, 
  2.19  subdivision 10, is amended to read: 
  2.20     Subd. 10.  [CREDIT INSURANCE.] (a) The sale of credit 
  2.21  insurance or mortgage insurance is subject to chapters 61A, 62A, 
  2.22  and 62B, as applicable, and the rules adopted under those 
  2.23  chapters, if any.  In case there are multiple consumers 
  2.24  obligated under a transaction subject to this chapter, no policy 
  2.25  or certificate of insurance providing credit life insurance may 
  2.26  be procured by or through a financial institution or person 
  2.27  described in subdivision 2 upon more than two of the consumers, 
  2.28  in which case they may be insured jointly.  
  2.29     (b) A financial institution that provides credit insurance 
  2.30  in relation to open-end credit may calculate the charge to the 
  2.31  borrower in each billing cycle by applying the current premium 
  2.32  rate to the balance in the manner permitted with respect to 
  2.33  finance charges by the provisions on finance charge in this 
  2.34  section.  
  2.35     (c) Upon prepayment in full of a consumer loan or credit 
  2.36  sale contract by the proceeds of credit insurance or mortgage 
  3.1   insurance, the consumer or the consumer's estate is entitled to 
  3.2   a refund of any portion of a separate charge for insurance that 
  3.3   by reason of prepayment is retained by the financial institution 
  3.4   or returned to it by the insurer, unless the charge was computed 
  3.5   from time to time on the basis of the balances of the consumer's 
  3.6   loan or credit sale contract.  
  3.7      (d) This section does not require a financial institution 
  3.8   to grant a refund to the consumer if all refunds due to the 
  3.9   consumer under paragraph (c) amount to less than $5 and, except 
  3.10  as provided in paragraph (c), does not require the financial 
  3.11  institution to account to the consumer for any portion of a 
  3.12  separate charge for insurance because:  
  3.13     (1) the insurance is terminated by performance of the 
  3.14  insurer's obligation; 
  3.15     (2) the financial institution pays or accounts for premiums 
  3.16  to the insurer in amounts and at times determined by the 
  3.17  agreement between them; or 
  3.18     (3) the financial institution receives directly or 
  3.19  indirectly under a policy of insurance a gain or advantage not 
  3.20  prohibited by law.  
  3.21     (e) Except as provided in paragraph (d), the financial 
  3.22  institution shall promptly make or cause to be made an 
  3.23  appropriate refund to the consumer with respect to a separate 
  3.24  charge made to the consumer for insurance if:  
  3.25     (1) the insurance is not provided or is provided for a 
  3.26  shorter term than for which the charge to the borrower for 
  3.27  insurance was computed; or 
  3.28     (2) the insurance terminates before the end of the term for 
  3.29  which it was written because of prepayment in full or otherwise. 
  3.30     (f) If a financial institution requires insurance, upon 
  3.31  notice to the borrower, the borrower has the option of providing 
  3.32  the required insurance through an existing policy of insurance 
  3.33  owned or controlled by the borrower, or through a policy to be 
  3.34  obtained and paid for by the borrower, but the financial 
  3.35  institution for reasonable cause may decline the insurance 
  3.36  provided by the borrower.  
  4.1      Sec. 4.  Minnesota Statutes 1998, section 47.60, 
  4.2   subdivision 2, is amended to read: 
  4.3      Subd. 2.  [AUTHORIZATION, TERMS, CONDITIONS, AND 
  4.4   PROHIBITIONS.] (a) In lieu of the interest, finance charges, or 
  4.5   fees in any other law, a consumer small loan lender may charge 
  4.6   the following:  
  4.7      (1) on any amount up to and including $50, a charge of 
  4.8   $5.50 may be added; 
  4.9      (2) on amounts in excess of $50, but not more than $100, a 
  4.10  charge may be added equal to ten percent of the loan proceeds 
  4.11  plus a $5 administrative fee; 
  4.12     (3) on amounts in excess of $100, but not more than $250, a 
  4.13  charge may be added equal to seven percent of the loan proceeds 
  4.14  with a minimum of $10 plus a $5 administrative fee; 
  4.15     (4) for amounts in excess of $250 and not greater than the 
  4.16  maximum in subdivision 1, paragraph (a), a charge may be added 
  4.17  equal to six percent of the loan proceeds with a minimum of 
  4.18  $17.50 plus a $5 administrative fee.  
  4.19     (b) The term of a loan made under this section shall be for 
  4.20  no more than 30 calendar days.  
  4.21     (c) After maturity, the contract rate must not exceed 2.75 
  4.22  percent per month of the remaining loan proceeds after the 
  4.23  maturity date calculated at a rate of 1/30 of the monthly rate 
  4.24  in the contract for each calendar day the balance is outstanding.
  4.25     (d) No insurance charges or other charges must be permitted 
  4.26  to be charged, collected, or imposed on a consumer small loan 
  4.27  except as authorized in this section.  
  4.28     (e) On a loan transaction in which cash is advanced in 
  4.29  exchange for a personal check, a return check charge may be 
  4.30  charged as authorized by section 332.50, subdivision 2, 
  4.31  paragraph (d) (a).  
  4.32     (f) A loan made under this section must not be repaid by 
  4.33  the proceeds of another loan made under this section by the same 
  4.34  lender or related interest.  The proceeds from a loan made under 
  4.35  this section must not be applied to another loan from the same 
  4.36  lender or related interest.  No loan to a single borrower made 
  5.1   pursuant to this section shall be split or divided and no single 
  5.2   borrower shall have outstanding more than one loan with the 
  5.3   result of collecting a higher charge than permitted by this 
  5.4   section or in an aggregate amount of principal exceed at any one 
  5.5   time the maximum of $350.  
  5.6      Sec. 5.  Minnesota Statutes 1998, section 48.56, is amended 
  5.7   to read: 
  5.8      48.56 [BANKING INSTITUTIONS MAY USE FEDERAL BANKING ACT 
  5.9   LAWS.] 
  5.10     Any banking institution now or hereafter organized under 
  5.11  the laws of this state is hereby empowered, on the authority of 
  5.12  its board of directors, or a majority thereof, to enter into 
  5.13  such contracts, incur such obligations and generally to do and 
  5.14  perform any and all such acts and things as may be necessary or 
  5.15  appropriate in order to take advantage of any and all 
  5.16  memberships, loans, subscriptions, contracts, grants, rights, or 
  5.17  privileges which may at any time be available or enure to 
  5.18  banking institutions or to their depositors, creditors, 
  5.19  stockholders, receivers, or liquidators, by virtue of those 
  5.20  provisions of Section 8 of the federal "Banking Acts of 1933" 
  5.21  (Section 12B of the Federal Reserve Act, as amended (Mason's 
  5.22  United States Code Annotated, title 12, s 264)), which establish 
  5.23  the Federal Deposit Insurance Corporation and provide for the 
  5.24  insurance of deposits, or of any other provisions of that or of 
  5.25  any other act or resolution of Congress to aid, regulate, or 
  5.26  safeguard banking institutions and their depositors, including 
  5.27  any amendments of the same or any substitutions therefor; and to 
  5.28  subscribe for and acquire any stock, debentures, bonds, or other 
  5.29  types of securities of the Federal Deposit Insurance 
  5.30  Corporation, and to comply with the lawful regulations and 
  5.31  requirements from time to time issued or made by such 
  5.32  corporation.  Subdivision 1.  [GENERAL POWERS.] The board of 
  5.33  directors of a banking institution may enter into a contract, 
  5.34  incur an obligation, or generally do what is necessary or 
  5.35  appropriate to make use of United States Code, Title 12, section 
  5.36  1811, or any act or resolution of Congress enacted or resolved 
  6.1   to aid, regulate, or safeguard banking institutions and their 
  6.2   depositors.  
  6.3      Subd. 2.  [GENERAL RIGHTS AND PRIVILEGES.] Memberships, 
  6.4   loans, subscriptions, contracts, grants, rights, or privileges 
  6.5   that, under the act or resolution, are available to or enure to 
  6.6   banking institutions, or their depositors, creditors, 
  6.7   stockholders, receivers, or liquidators may be taken advantage 
  6.8   of under this section. 
  6.9      Subd. 3.  [PURCHASE OF FDIC SECURITIES.] The board may 
  6.10  subscribe for and acquire securities of the Federal Deposit 
  6.11  Insurance Corporation. 
  6.12     Subd. 4.  [COMPLYING WITH FDIC REQUIREMENTS.] The board may 
  6.13  comply with the corporation's requirements. 
  6.14     Sec. 6.  Minnesota Statutes 1998, section 56.131, 
  6.15  subdivision 4, is amended to read: 
  6.16     Subd. 4.  [ADJUSTMENT OF DOLLAR AMOUNTS.] The dollar 
  6.17  amounts in subdivisions 2 and 6, sections 53.04, subdivision 3a, 
  6.18  paragraph (c), 56.01, 56.12, and 56.125 shall change 
  6.19  periodically, as provided in section 47.59, subdivision 3. 
  6.20     Sec. 7.  Minnesota Statutes 1998, section 58.02, 
  6.21  subdivision 10, is amended to read: 
  6.22     Subd. 10.  [FINANCIAL INSTITUTION.] "Financial institution" 
  6.23  means a bank, bank and trust, trust company with banking powers, 
  6.24  savings bank, savings association, or credit union, organized 
  6.25  under the laws of this state, any other state, or the United 
  6.26  States; a Minnesota host state branch of an out-of-state 
  6.27  state-chartered bank as provided for in section 49.411; an 
  6.28  industrial loan and thrift under chapter 53; or a regulated 
  6.29  lender under chapter 56.  The term "financial institution" also 
  6.30  includes a subsidiary or operating subsidiary of a financial 
  6.31  institution or of a bank holding company as defined in the 
  6.32  federal Bank Holding Company Act, United States Code, title 12, 
  6.33  section 1841 et seq., if the subsidiary or operating subsidiary 
  6.34  can demonstrate to the satisfaction of the commissioner that it 
  6.35  is regulated and subject to active and ongoing oversight and 
  6.36  supervision by a federal banking agency, as defined in the 
  7.1   Federal Deposit Insurance Act, United States Code, title 12, 
  7.2   section 1811 et seq., or the commissioner.  
  7.3      Sec. 8.  Minnesota Statutes 1999 Supplement, section 58.04, 
  7.4   subdivision 1, is amended to read: 
  7.5      Subdivision 1.  [RESIDENTIAL MORTGAGE ORIGINATOR LICENSING 
  7.6   REQUIREMENTS.] (a) Beginning August 1, 1999, no person shall act 
  7.7   as a residential mortgage originator, or make residential 
  7.8   mortgage loans without first obtaining a license from the 
  7.9   commissioner according to the licensing procedures provided in 
  7.10  this chapter. 
  7.11     (b) The following persons are exempt from the residential 
  7.12  mortgage originator licensing requirements: 
  7.13     (1) an employee of one mortgage originator licensee or one 
  7.14  person holding a certificate of exemption; 
  7.15     (2) a person engaged solely in commercial mortgage 
  7.16  activities; 
  7.17     (3) a person licensed as a real estate broker under chapter 
  7.18  82, and who is not licensed to another real estate broker; 
  7.19     (3) an individual real estate licensee who is licensed to 
  7.20  the a real estate broker as described in clause (2) if: 
  7.21     (i) the individual licensee acts only under the name, 
  7.22  authority, and supervision of the broker to whom the licensee is 
  7.23  licensed; 
  7.24     (ii) the broker to whom the licensee is licensed obtains a 
  7.25  certificate of exemption according to section 58.05, subdivision 
  7.26  2; 
  7.27     (iii) the broker does not collect an advance fee for its 
  7.28  residential mortgage-related activities; and 
  7.29     (iv) the residential mortgage origination activities are 
  7.30  incidental to the real estate licensee's primary activities as a 
  7.31  real estate broker or salesperson; 
  7.32     (4) an individual licensed as a property/casualty or 
  7.33  life/health insurance agent under chapter 60K if: 
  7.34     (i) the insurance agent acts on behalf of only one 
  7.35  residential mortgage originator, which is in compliance with 
  7.36  chapter 58; 
  8.1      (ii) the insurance agent has entered into a written 
  8.2   contract with the mortgage originator under the terms of which 
  8.3   the mortgage originator agrees to accept responsibility for the 
  8.4   insurance agent's residential mortgage-related activities; 
  8.5      (iii) the insurance agent obtains a certificate of 
  8.6   exemption under section 58.05, subdivision 2; and 
  8.7      (iv) the insurance agent does not collect an advance fee 
  8.8   for the insurance agent's residential mortgage-related 
  8.9   activities; 
  8.10     (5) a person making who is not in the business of making 
  8.11  residential mortgage loans and who makes no more than five 
  8.12  residential mortgage three such loans, with its own funds, 
  8.13  during any 12-month period; 
  8.14     (6) a financial institution as defined in section 58.02, 
  8.15  subdivision 10; 
  8.16     (7) an agency of the federal government, or of a state or 
  8.17  municipal government; 
  8.18     (8) an employee or employer pension plan making loans only 
  8.19  to its participants; 
  8.20     (9) a person acting in a fiduciary capacity, such as a 
  8.21  trustee or receiver, as a result of a specific order issued by a 
  8.22  court of competent jurisdiction; or 
  8.23     (10) a person exempted by order of the commissioner.  
  8.24     Sec. 9.  Minnesota Statutes 1998, section 58.04, 
  8.25  subdivision 2, is amended to read: 
  8.26     Subd. 2.  [RESIDENTIAL MORTGAGE SERVICER LICENSING 
  8.27  REQUIREMENTS.] (a) Beginning August 1, 1999, no person shall 
  8.28  engage in activities or practices that fall within the 
  8.29  definition of "servicing a residential mortgage loan" under 
  8.30  section 58.02, subdivision 22, without first obtaining a license 
  8.31  from the commissioner according to the licensing procedures 
  8.32  provided in this chapter. 
  8.33     (b) The following persons are exempt from the residential 
  8.34  mortgage servicer licensing requirements: 
  8.35     (1) a person licensed as a residential mortgage originator; 
  8.36     (2) an employee of one licensee or one person holding a 
  9.1   certificate of exemption based on an exemption under this 
  9.2   subdivision; 
  9.3      (3) a person engaged solely in commercial mortgage 
  9.4   activities; 
  9.5      (4) a person servicing loans made with its own funds, if no 
  9.6   more than five three such loans are made in any 12-month period; 
  9.7      (5) (4) a financial institution as defined in section 
  9.8   58.02, subdivision 10; 
  9.9      (6) (5) an agency of the federal government, or of a state 
  9.10  or municipal government; 
  9.11     (7) (6) an employee or employer pension plan making loans 
  9.12  only to its participants; 
  9.13     (8) (7) a person acting in a fiduciary capacity, such as a 
  9.14  trustee or receiver, as a result of a specific order issued by a 
  9.15  court of competent jurisdiction; or 
  9.16     (9) (8) a person exempted by order of the commissioner. 
  9.17     Sec. 10.  Minnesota Statutes 1998, section 58.04, 
  9.18  subdivision 3, is amended to read: 
  9.19     Subd. 3.  [CONDUCTING BUSINESS UNDER LICENSE.] No person 
  9.20  required to be licensed under this chapter may, without a 
  9.21  license, do business under a name or title or circulate or use 
  9.22  advertising or make representations or give information to a 
  9.23  person, that indicates or reasonably implies activity within the 
  9.24  scope of this chapter. 
  9.25     No person licensed under this chapter may do business under 
  9.26  more than one name or title. 
  9.27     Sec. 11.  Minnesota Statutes 1998, section 58.05, is 
  9.28  amended by adding a subdivision to read: 
  9.29     Subd. 3.  [CERTIFICATE OF EXEMPTION.] A person must obtain 
  9.30  a certificate of exemption from the commissioner to qualify as 
  9.31  an exempt person under section 58.04, subdivision 1, paragraph 
  9.32  (b), as a real estate broker under clause (2), an insurance 
  9.33  agent under clause (4), a financial institution under clause 
  9.34  (6), or by order of the commissioner under clause (10); or under 
  9.35  section 58.04, subdivision 2, paragraph (b), as a financial 
  9.36  institution under clause (4), or by order of the commissioner 
 10.1   under clause (8). 
 10.2      Sec. 12.  Minnesota Statutes 1998, section 58.08, as 
 10.3   amended by Laws 1999, chapter 151, section 36, is amended to 
 10.4   read: 
 10.5      58.08 [BONDS; LETTERS OF CREDIT.] 
 10.6      Subdivision 1.  [REQUIREMENT OF RESIDENTIAL MORTGAGE 
 10.7   ORIGINATORS.] A residential mortgage originator licensee 
 10.8   engaging in servicing a residential mortgage loan shall 
 10.9   continuously maintain a surety bond or irrevocable letter of 
 10.10  credit in an amount not less than $50,000 in a form approved by 
 10.11  the commissioner, issued by an insurance company or bank 
 10.12  authorized to do so in this state.  The bond or irrevocable 
 10.13  letter of credit must be available for the recovery of expenses, 
 10.14  fines, and fees levied by the commissioner under this chapter 
 10.15  relating to servicing, and for losses or damages incurred by 
 10.16  borrowers as the result of a licensee's servicing-related 
 10.17  noncompliance with the requirements of this chapter, sections 
 10.18  325D.43 to 325D.48, and 325F.67 to 325F.69, or breach of 
 10.19  contract. 
 10.20     The bond or irrevocable letter of credit must be submitted 
 10.21  with the originator's license application, and evidence of 
 10.22  continued coverage must be submitted with each renewal.  Any 
 10.23  change in the bond or letter of credit must be submitted for 
 10.24  approval by the commissioner, within ten days of its execution. 
 10.25     Subd. 2.  [REQUIREMENT OF RESIDENTIAL MORTGAGE SERVICERS.] 
 10.26  A residential mortgage servicer licensee shall continuously 
 10.27  maintain a surety bond or irrevocable letter of credit in an 
 10.28  amount not less than $100,000 in a form approved by the 
 10.29  commissioner, issued by an insurance company or bank authorized 
 10.30  to do so in this state.  The bond or irrevocable letter of 
 10.31  credit must be available for the recovery of expenses, fines, 
 10.32  and fees levied by the commissioner under this chapter, and for 
 10.33  losses or damages incurred by borrowers or other aggrieved 
 10.34  parties as the result of a licensee's noncompliance with the 
 10.35  requirements of this chapter, sections 325D.43 to 325D.48, and 
 10.36  325F.67 to 325F.69, or breach of contract relating to activities 
 11.1   regulated by this chapter.  
 11.2      The bond or irrevocable letter of credit must be submitted 
 11.3   with the servicer's license application and evidence of 
 11.4   continued coverage must be submitted with each renewal.  Any 
 11.5   change in the bond or letter of credit must be submitted for 
 11.6   approval by the commissioner, within ten days of its execution. 
 11.7      Subd. 3.  [EXEMPTION.] Subdivisions 1 and 2 do not apply to 
 11.8   mortgage originators or mortgage servicers who are approved as 
 11.9   seller/servicers by the Federal National Mortgage Association or 
 11.10  the Federal Home Loan Mortgage Corporation. 
 11.11     Subd. 4.  [IRREVOCABLE LETTER OF CREDIT.] As used in this 
 11.12  chapter, an irrevocable letter of credit must be accepted only 
 11.13  if it is clean, irrevocable, and contains an evergreen clause. 
 11.14     (a) "Clean" means a letter of credit that is not 
 11.15  conditioned on the delivery of any other documents or materials. 
 11.16     (b) "Irrevocable" means a letter of credit that cannot be 
 11.17  modified or revoked without the consent of the beneficiary once 
 11.18  the beneficiary is established. 
 11.19     (c) "Evergreen clause" means one that specifically states 
 11.20  the expiration of a letter of credit will not take place without 
 11.21  a 60-day notice by the issuer and one that allows the issuer to 
 11.22  conduct an annual review of the account party's financial 
 11.23  condition.  If prior notice of expiration is not given by the 
 11.24  issuer, the letter of credit is automatically extended for one 
 11.25  year. 
 11.26     A clean irrevocable letter of credit must be accepted only 
 11.27  if it is issued by a financial institution that is authorized to 
 11.28  engage in banking in any of the 50 states or under the laws of 
 11.29  the United States, and whose business is substantially confined 
 11.30  to banking and supervised by the state commissioner of commerce 
 11.31  or similar official, and that has a long-term debt rating by a 
 11.32  recognized national rating agency of investment grade or 
 11.33  better.  If no long-term debt rating is available, the financial 
 11.34  institution must have the equivalent investment grade financial 
 11.35  characteristics. 
 11.36     Sec. 13.  Minnesota Statutes 1998, section 58.10, 
 12.1   subdivision 1, is amended to read: 
 12.2      Subdivision 1.  [AMOUNTS.] The following fees must be paid 
 12.3   to the commissioner: 
 12.4      (1) for an initial residential mortgage originator license, 
 12.5   $800; 
 12.6      (2) for a renewal license, $400; 
 12.7      (3) for an initial residential mortgage servicer's license, 
 12.8   $1,000; 
 12.9      (4) for a renewal license, $500; and 
 12.10     (5) license service fees as set forth in chapter 45; and 
 12.11     (6) for a certificate of exemption, $100. 
 12.12     Sec. 14.  [58.135] [RATES AND CHARGES.] 
 12.13     Subdivision 1.  [FIRST LIEN MORTGAGES.] A residential 
 12.14  mortgage originator making first lien residential mortgage loans 
 12.15  must comply with the applicable limits on residential mortgage 
 12.16  loan rates, fees, and charges as found in sections 47.20 and 
 12.17  47.204. 
 12.18     Subd. 2.  [JUNIOR LIEN MORTGAGES.] (a) A residential 
 12.19  mortgage originator that is a bank, bank and trust, trust 
 12.20  company with banking powers, savings bank, savings association, 
 12.21  or credit union organized under the laws of this or any other 
 12.22  state or the United States, or an industrial loan and thrift 
 12.23  company under chapter 53 or a regulated lender under chapter 56 
 12.24  or an entity in another state subject to regulation 
 12.25  substantially similar to chapter 53 or 56, making junior lien 
 12.26  residential loans, must comply with the limits on residential 
 12.27  mortgage loan rates, fees, and charges as found in section 47.59.
 12.28     (b) A residential mortgage originator other than an entity 
 12.29  designated in paragraph (a) making junior lien residential 
 12.30  loans, must comply with the limits on residential mortgage loan 
 12.31  rates, fees, and charges as found in section 47.20. 
 12.32     Sec. 15.  Minnesota Statutes 1998, section 168.72, is 
 12.33  amended by adding a subdivision to read: 
 12.34     Subd. 1a.  [PROMPT CREDITING OF PAYMENTS.] Contract holders 
 12.35  shall credit a payment to the customer's account as of the date 
 12.36  of receipt. 
 13.1      Sec. 16.  [REPEALER.] 
 13.2      (a) Minnesota Statutes 1998, sections 58.02, subdivision 
 13.3   15; and 58.05, subdivision 2, are repealed. 
 13.4      (b) Minnesota Rules, part 2675.4180, is repealed. 
 13.5      Sec. 17.  [EFFECTIVE DATES.] 
 13.6      Sections 1, 3 to 13, and 16 are effective the day after 
 13.7   final enactment.  Sections 2 and 15 are effective July 1, 2000.