Title 54 — DEBTOR AND CREDITOR

The creditor shall have the burden of establishing by a preponderance of the evidence that the excess amount or other violation occurred as a result of an unintentional or bona fide error of computation. Source: SL 1974, ch 305 , § 16.

The Department of Labor and Regulation may promulgate rules and regulations to carry out the provisions of this chapter. Such rules and regulations shall be promulgated in accordance with chapter 1-26 . Source: SL 1974, ch 305 , § 18; SL 2004, ch 17 , § 304; SL 2011, ch 1 (Ex. Or…

If any part of this chapter is invalid, all valid parts that are severable from the invalid part shall remain in effect. If any part of this chapter is invalid in one or more of its applications, the parts that are severable from the invalid applications shall remain in effect in…

Notwithstanding the provisions of any other law, a creditor may contract for and receive, pursuant to an installment sales contract, a finance charge at a rate as agreed upon by the creditor and the consumer by written agreement. The finance charge is expressed and compounded in …

In addition to the finance charge, a creditor may contract for, and receive the following additional charges in connection with an installment sales contract if such charges are itemized and disclosed to the buyer: (1) Official fees and taxes; (2) Charges for guaranteed asset pro…

The term of a consumer obligation under this chapter, commences with the date the credit is granted unless goods are delivered or services are performed ten days or more after the date credit is granted, in which case the term commences with the date of delivery or performance. N…

Except as provided in this section, no creditor shall modify the terms of any agreement with a consumer with respect to any outstanding obligation of the consumer, which results in an increase of the rate of the finance or other charges or an increase in the amount of an installm…

As used in this chapter, unless the context otherwise requires, "Rule of 78" means a refund of charges which shall be at least as great a proportion of the total charges, as the sum of the remaining monthly balances of principal and interest combined scheduled to follow the date …

The Rule of 78 as defined in § 54-3A-8 may not be used in any consumer installment sales contract. The Rule of 78 may, however, be used to compute the unearned premium on insurance. Source: SL 1984, ch 320 , § 1.

Upon prepayment in full of the unpaid balance of an installment sales contract, or upon a refinancing or a consolidation thereof, an amount equal to the total finance charge contracted for, less the finance charge earned, shall be rebated to the buyer. If the total of all rebates…

54-4-2

54-4-3 54-4-3 to 54-4-3 5. Repealed by SL 1998, ch 280 , § 30. 54-4-36 Definition of terms. 54-4-37 Entities exempt from chapter provisions. 54-4-37.1 Exemption for originating, selling, servicing, or acquiring five or fewer loans in twelve-month period where total of outstanding…

Terms used in this chapter mean: (1) "Advertisement," a commercial message in any medium that aids, promotes, or assists, directly or indirectly, the sale of products or services; (2) "Business of lending money," includes the originating, selling, servicing, acquiring, or purchas…

The following entities are exempt from the provisions of this chapter: (1) Any state bank and its subsidiary; (2) Any national bank and its subsidiary; (3) Any bank holding company and its subsidiary; (4) Any other federally insured financial institution, its holding company and …

Any person who, on, before, or after July 1, 2017, originates, sells, services, or acquires five or fewer loans in a twelve-month period is exempt from this chapter, except for the provisions of chapter 10-43 as referenced in § 54-4-54 , as long as the total amount of the loans o…

The commission may promulgate rules pursuant to chapter 1-26 to provide for: (1) Rules of practice; (2) Internal management of finance companies; (3) Retention of records; (4) Additional examination fees; and (5) Remote electronic lending. Source: SL 1998, ch 280 , § 3.

An installment loan contract shall comply with all provisions of Title 53. Source: SL 1998, ch 280 , § 4.

Any person who engages in the business of lending money shall apply for a license as prescribed by this chapter. The applicant shall apply for a license under oath on forms supplied by the division. The application shall contain the name of the applicant's business, proof of sure…

The director shall approve or deny an application for a license within thirty days of receipt of any application. Source: SL 1998, ch 280 , § 6.

The applicant shall submit with the application for a license a bond in an amount not to exceed the total of ten thousand dollars for the first license and two thousand five hundred dollars for each additional license. The bond shall be satisfactory to the director and issued by …

The director shall investigate the facts concerning the application. The director may review and consider the relevant business records of the applicant and the competence, experience, integrity, and financial ability of any person who is a member, partner, director, officer, or …

After procuring such license from the Division of Banking, the licensee may engage in the business of making loans and may contract for and receive interest charges and other fees at rates, amounts, and terms as agreed to by the parties which may be included in the principal bala…

No person may engage in any device, subterfuge, or pretense to evade the requirements of § 54-4-44 , including, but not limited to, making loans disguised as a personal property sale and leaseback transaction; disguising loan proceeds as a cash rebate for the pretextual installme…

For purposes of § 54-4-44 , fees contracted for or received that are "incident to the extension of credit" in connection with a loan for the purchase of a motor vehicle do not include fees for optional maintenance agreements and extended service contracts, official fees and taxes…

For the purposes of § 54-4-44 for all loans, late fees, return check fees, and attorney's fees incurred upon consumer default are not fees "incident to the extension of credit." Source: SL 2017, ch 205 , § 4.

The provisions of § 54-4-44 that place limitations on licensees that are engaged in the business of making loans do not apply to a licensee engaged in business-to-business lending. For purposes of this section, the term, business-to-business lending, means any lending to or in fu…

A license expires on December thirty-first. To renew a license, the licensee shall file for renewal by December first. The renewal application shall include a renewal fee not to exceed one thousand dollars, as set by rules of the commission promulgated pursuant to chapter 1-26 , …

The licensee may not transfer or assign the license. The licensee may only transact business under a name shown on the license. Any name change is subject to prior approval by the director. Source: SL 1998, ch 280 , § 11.

Each licensee's business location shall be licensed. The director shall approve or deny any change of location. The director shall amend the license to show the new location upon granting approval. Source: SL 1998, ch 280 , § 12.

An employee of a licensee may work in a remote location other than the business location identified pursuant to § 54-4-40 or 54-4-47 , if the licensee: (1) Ensures in-person interactions with consumers are not conducted at the remote location and the remote location is not repres…

The director may issue a cease and desist order from any practice that does not conform to the requirements set forth in this chapter or any commission rule, order, or condition imposed in writing, or any federal statute, rule, or regulation pertaining to consumer credit. A cease…

The director may condition, deny, decline to renew, suspend for a period not to exceed six months, or revoke a license for good cause pursuant to chapters 1-26 and 1-26D . If the licensee is the holder of more than one license, the director may condition, deny, decline to renew, …

An action may be brought in circuit court by the attorney general or the division, or both, to enjoin a licensee from engaging in or continuing a violation or from doing any act in furtherance thereof. Source: SL 1998, ch 280 , § 15; SL 2005, ch 258 , § 7.

In addition to any other means provided by law for the enforcement of a restraining order or injunction, the court, in which the action is brought, may impound, and appoint a receiver for, the property and business of the defendant, including books, papers, documents, and records…

No person may engage in the business of lending money without a license. A violation of this section is a Class 1 misdemeanor. Source: SL 1998, ch 280 , § 17.

Any money received by the division pursuant to this chapter shall be deposited in the banking revolving fund. Source: SL 1998, ch 280 , § 18; SL 2006, ch 245 , § 8.

Each licensee, whether a corporation or otherwise, shall pay the annual tax provided in chapter 10-43 , upon the net income of the licensee, and measured by the net income assignable to such business in South Dakota. The annual tax provided by this section may not be less than tw…

Except for taxes on real property and license fees and other fees imposed by this chapter, the tax imposed in § 54-4-54 is in lieu of all other taxes and license fees, state, county, or local, upon the business of the licensee, or upon any money, credits, or other assets of the l…

Each licensee shall annually file with its renewal application a report of income and financial condition for the preceding license year or any other relevant information requested in writing by the director. These reports shall be under oath and on forms prescribed by the divisi…

The division may annually, or as often as the director considers necessary, conduct an examination of business records and accounts of any licensee licensed under this chapter. The director may charge back to the licensee any cost associated with an on-site examination. The direc…

The licensee shall disclose in any loan contract the following: (1) The amount and date of the loan; (2) The amount of the down payment, if any; (3) The dates any payments are due and the amount of payments; (4) A list of any property used to secure the loan; (5) Any liens or tit…

A creditor may require property insurance on any loan secured by tangible property. The amount of insurance required shall be reasonable and appropriate considering the nature of the property, the amount of the loan, the maturity of the loan, and any other circumstances. The insu…

A licensee may sell insurance to anyone with whom the licensee has a lending relationship. However, the licensee may not require the debtor to purchase the insurance from the licensee or any affiliate as a condition of the loan. The licensee may not require a borrower to purchase…

The debtor may request a copy of any transaction pertaining to the debtor's installment loan contract. The licensee shall provide such copies upon request. Source: SL 1998, ch 280 , § 26.

When the payment of a loan is satisfied, the licensee shall release any liens against any property used as security, cancel any note, and release all assignments associated with the contract. The licensee shall send the note stamped paid in full and release any liens or assignmen…

Any licensee may advertise in any medium. No licensee may advertise any statement or representation, including rates, terms, or conditions for making or negotiating loans that is false, misleading, or deceptive, or that refers to the supervision of business by the state. Source: …

The provisions of this chapter do not apply to any person selling goods or services and providing financing for such goods or services. Source: SL 1998, ch 280 , § 35; SL 2006, ch 245 , § 11.

No licensee may renew, rollover, or flip a short- term consumer loan more than four times. No renewal, rollover, or flip is valid unless, at the time of the renewal, rollover, or flip, the debtor pays the outstanding fee and reduces the principal amount of the loan as provided in…

The maximum principal amount of any payday loan, or the total outstanding principal balances of all payday loans made by a licensee to a single borrower, may not exceed five hundred dollars at any time. A violation of this section is a Class 1 misdemeanor. Source: SL 2002, ch 223…

If the division requires the production of records that are located outside this state, the party shall either make them available to the division at a convenient location within this state or pay the reasonable and necessary expenses for the division to examine them at the place…