Administrative Code

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Virginia Administrative Code
Title 10. Finance And Financial Institutions
Agency 5. State Corporation Commission
Chapter 210. Motor Vehicle Title Lending
7/1/2022

10VAC5-210-50. Additional business requirements and restrictions.

A. A licensee shall post on its website, and in or on its licensed locations so that the posting is legible from the outside, the days and hours during which it is open for business.

B. A licensee shall endeavor to provide the loan documents and pamphlet required by 10VAC5-210-30 in a language other than English when a prospective borrower is unable to read the materials printed in English.

C. A licensee shall not (i) make a motor vehicle title loan to a person who has an outstanding motor vehicle title loan from another licensee or (ii) knowingly make a motor vehicle title loan to a covered member of the armed forces, or a dependent of a covered member of the armed forces. To enable a licensee to make these determinations, a licensee shall clearly and conspicuously include the following questions in its written loan application, which the licensee shall require each applicant to answer before obtaining a motor vehicle title loan. A licensee shall not make a motor vehicle title loan to an applicant unless the applicant answers "no" to all of these questions:

1. Do you currently have a motor vehicle title loan from any other motor vehicle title lender?

2. Are you (i) on active duty in the armed forces under a call or order that does not specify a period of 30 days or less, or (ii) on active guard and reserve duty?

3. Are you married to an individual who is either (i) on active duty in the armed forces under a call or order that does not specify a period of 30 days or less, or (ii) on active guard and reserve duty?

4. Are you the child, as defined in 38 USC § 101(4), of an individual who is either (i) on active duty in the armed forces under a call or order that does not specify a period of 30 days or less, or (ii) on active guard and reserve duty?

5. Was more than one-half of your support during the past 180 days provided by an individual who is either (i) on active duty in the armed forces under a call or order that does not specify a period of 30 days or less, or (ii) on active guard and reserve duty?

D. A licensee shall not require a borrower to purchase or maintain property insurance for a motor vehicle from or through a particular provider or list of providers.

E. A licensee shall not obtain any agreement from a borrower that gives the licensee or a third party the authority to create or otherwise prepare a check that is drawn upon the borrower's account at a depository institution.

F. If a licensee disburses loan proceeds by means of a check, the licensee shall not (i) charge the borrower a fee for cashing the check or (ii) permit either a check casher located in the same office as the licensee or any affiliated check casher to charge the borrower a fee for cashing the check.

G. A borrower shall have the right to cancel or rescind a motor vehicle title loan agreement at any time on or before 5 p.m. of the third business day immediately following the date that the loan agreement is executed by the borrower by returning the original loan proceeds check or paying to the licensee, in the form of cash or good funds instrument, the principal amount advanced to the borrower. If a borrower cancels or rescinds a loan agreement in accordance with this subsection, the licensee shall upon receipt of the loan proceeds check, cash, or good funds instrument (i) mark the original loan agreement with the word "canceled," return it to the borrower, and retain a copy in its records; and (ii) return the certificate of title to the borrower. Furthermore, the licensee shall not be entitled to charge, collect, receive, recover, or require a borrower to pay any interest, fees, or other amounts otherwise permitted by § 6.2-2216 of the Code of Virginia.

H. A licensee shall give a borrower a dated receipt for each payment made, which shall state the updated balance due on the loan.

I. A licensee shall release its security interest and perform the following acts within 10 days after the date that a borrower's obligations under a motor vehicle title loan agreement are satisfied in full: (i) mark the original loan agreement with the word "paid" or "canceled," return it to the borrower, and retain a copy in its records; (ii) take any action necessary to reflect the termination of its lien on the motor vehicle's certificate of title; and (iii) return the certificate of title to the borrower.

J. When sending the written notices and accounting specified by subsection 19 of § 6.2-2215 and § 6.2-2217 of the Code of Virginia, a licensee shall obtain proof of mailing from the United States Postal Service or other common carrier.

K. A licensee may impose a late charge for failure to make timely payment of any amount due under a motor vehicle title loan agreement provided that (i) the late charge is specified in the loan agreement and (ii) the amount of the late charge does not exceed the lesser of $20 or 5.0% of the amount of the payment. A payment shall be considered timely if it is made no later than seven calendar days after the due date specified in the loan agreement.

L. Nothing in the Act or this chapter shall be construed to prohibit a licensee from (i) voluntarily accepting a payment on an outstanding motor vehicle title loan from a borrower after the date that such payment was due to the licensee or (ii) considering a payment to be timely if it is made more than seven calendar days after its due date. However, except as otherwise permitted by the Act and this chapter, the licensee shall not charge, collect, receive, recover, or require a borrower to pay any additional interest, fees, or other amounts.

M. Pursuant to § 6.2-2201 of the Code of Virginia, a licensee shall not make a motor vehicle title loan that has been arranged or brokered by another person. This provision shall not be construed to prohibit a licensee from originating motor vehicle title loans through its own employees.

N. A licensee shall not obtain or receive a personal identification number (PIN) for a credit card, prepaid card, debit card, or any other type of card in connection with a motor vehicle title loan transaction.

O. A licensee shall comply with all federal laws and regulations applicable to the conduct of its business, including the Truth in Lending Act (15 USC § 1601 et seq.), Regulation Z (12 CFR Part 1026), the Equal Credit Opportunity Act (15 USC § 1691 et seq.), Regulation B (12 CFR Part 1002), and the Standards for Safeguarding Customer Information (16 CFR Part 314).

P. A licensee shall not provide any information to a borrower or prospective borrower that is false, misleading, or deceptive.

Q. A licensee shall not engage in any business or activity that directly or indirectly results in an evasion of the provisions of this chapter.

Statutory Authority

§§ 6.2-2214 and 12.1-13 of the Code of Virginia.

Historical Notes

Derived from Virginia Register Volume 27, Issue 3, eff. October 1, 2010; amended, Virginia Register Volume 27, Issue 23, eff. July 1, 2011; Volume 33, Issue 22, eff. July 1, 2017; Volume 38, Issue 2, eff. September 15, 2021.

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