1.1A bill for an act1.2relating to commerce; authorizing the imposition of certain fees in connection 1.3with certain loan transactions;amending Minnesota Statutes 2010, section 47.59, 1.4subdivision 6.1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:1.6    Section 1. Minnesota Statutes 2010, section 47.59, subdivision 6, is amended to read:1.7    Subd. 6. Additional charges. (a) For purposes of this subdivision, "financial 1.8institution" includes a person described in subdivision 4, paragraph (a). In addition to the 1.9finance charges permitted by this section, a financial institution may contract for and 1.10receive the following additional charges that may be included in the principal amount 1.11of the loan or credit sale unpaid balances:1.12(1) official fees and taxes;1.13(2) charges for insurance as described in paragraph (b);1.14(3) with respect to a loan or credit sale contract secured by real estate, the following 1.15"closing costs," if they are bona fide, reasonable in amount, and not for the purpose of 1.16circumvention or evasion of this section:1.17(i) fees or premiums for title examination, abstract of title, title insurance, surveys, 1.18or similar purposes;1.19(ii) fees for preparation of a deed, mortgage, settlement statement, or other 1.20documents, if not paid to the financial institution;1.21(iii) escrows for future payments of taxes, including assessments for improvements, 1.22insurance, and water, sewer, and land rents;1.23(iv) fees for notarizing deeds and other documents;1.24(v) appraisal and credit report fees; and2.1(vi) fees for determining whether any portion of the property is located in a flood 2.2zone and fees for ongoing monitoring of the property to determine changes, if any, 2.3in flood zone status;2.4(4) a delinquency charge on a payment, including the minimum payment due in 2.5connection with open-end credit, not paid in full on or before the tenth day after its due 2.6date in an amount not to exceed five percent of the amount of the payment or $5.20, 2.7whichever is greater;2.8(5) for a returned check or returned automatic payment withdrawal request, an 2.9amount not in excess of the service charge limitation in section 
         604.113, except that, on 2.10a loan transaction that is a consumer small loan as defined in section 47.60, subdivision 2.111, paragraph (a), in which cash is advanced in exchange for a personal check, the civil 2.12penalty provisions of section 604.113, subdivision 2, paragraph (b), may not be demanded 2.13or assessed against the borrower
         ; and2.14(6) charges for other benefits, including insurance, conferred on the borrower that 2.15are of a type that is not for credit; and2.16(7) except on an unsecured loan transaction that is either a consumer small loan, 2.17as defined in section 47.60, subdivision 1, paragraph (a), or a loan transaction that is a 2.18consumer short-term loan, as defined in section 47.601, subdivision 1, paragraph (d), 2.19the following reasonable fees and charges that are contracted for between a financial 2.20institution organized under chapter 53 and a borrower with respect to a non-recourse 2.21collateralized loan: fees for transporting, storing, securing, insuring, and maintaining 2.22the collateral for the loan.2.23(b) An additional charge may be made for insurance written in connection with the 2.24loan or credit sale contract, which may be included in the principal amount of the loan or 2.25credit sale unpaid balances:2.26(1) with respect to insurance against loss of or damage to property, or against 2.27liability arising out of the ownership or use of property, if the financial institution furnishes 2.28a clear, conspicuous, and specific statement in writing to the borrower setting forth the 2.29cost of the insurance if obtained from or through the financial institution and stating that 2.30the borrower may choose the person through whom the insurance is to be obtained;2.31(2) with respect to credit insurance or mortgage insurance providing life, accident, 2.32health, or unemployment coverage, if the insurance coverage is not required by the 2.33financial institution, and this fact is clearly and conspicuously disclosed in writing to 2.34the borrower, and the borrower gives specific, dated, and separately signed affirmative 2.35written indication of the borrower's desire to do so after written disclosure to the borrower 2.36of the cost of the insurance; and3.1(3) with respect to the vendor's single interest insurance, but only (i) to the extent 3.2that the insurer has no right of subrogation against the borrower; and (ii) to the extent that 3.3the insurance does not duplicate the coverage of other insurance under which loss is 3.4payable to the financial institution as its interest may appear, against loss of or damage 3.5to property for which a separate charge is made to the borrower according to clause (1); 3.6and (iii) if a clear, conspicuous, and specific statement in writing is furnished by the 3.7financial institution to the borrower setting forth the cost of the insurance if obtained from 3.8or through the financial institution and stating that the borrower may choose the person 3.9through whom the insurance is to be obtained.3.10(c) In addition to the finance charges and other additional charges permitted by 3.11this section, a financial institution may contract for and receive the following additional 3.12charges in connection with open-end credit, which may be included in the principal 3.13amount of the loan or balance upon which the finance charge is computed:3.14(1) annual charges, not to exceed $50 per annum, payable in advance, for the 3.15privilege of opening and maintaining open-end credit;3.16(2) charges for the use of an automated teller machine;3.17(3) charges for any monthly or other periodic payment period in which the borrower 3.18has exceeded or, except for the financial institution's dishonor would have exceeded, 3.19the maximum approved credit limit, in an amount not in excess of the service charge 3.20permitted in section 
         604.113;3.21(4) charges for obtaining a cash advance in an amount not to exceed the service 3.22charge permitted in section 
         604.113; and3.23(5) charges for check and draft copies and for the replacement of lost or stolen 3.24credit cards.3.25(d) In addition to the finance charges and other additional charges permitted by this 3.26section, a financial institution may contract for and receive a onetime loan administrative 3.27fee not exceeding $25 in connection with closed-end credit, which may be included in the 3.28principal balance upon which the finance charge is computed. This paragraph applies only 3.29to closed-end credit in an original principal amount of $4,320 or less. The determination 3.30of an original principal amount must exclude the administrative fee contracted for and 3.31received according to this paragraph.3.32(e) Upon written request by a borrower, the lender shall within seven days produce 3.33to the borrower documentation showing the fees that have been paid by the lender for 3.34transporting, storing, securing, insuring, and maintaining the collateral for the loan, 3.35including to whom the fees have been paid, the date, the amount, and the reason. Failure 3.36to produce said documentation shall result in a forfeiture of said fees.