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Virginia Administrative Code
Title 10. Finance and Financial Institutions
Agency 5. State Corporation Commission
Chapter 60. Consumer Finance Companies
4/26/2019

10VAC5-60-30. Allotment Program Loans; Applicability; Definitions; Rules.

A. This chapter applies to all licensees under Chapter 15 (§ 6.2-1500 et seq.) of Title 6.2 of the Code of Virginia making any loan under Chapter 15 of Title 6.2 of the Code of Virginia in connection with which loan a borrower authorizes an allotment and automatic disbursement from an account for the purpose of making any payments required by the loan agreement. Such a loan is referred to herein as an "allotment program loan."

B. As used in this chapter the following terms shall have the following meanings:

"Allotment" means payment of any part of a borrower's military pay to a financial institution as permitted under federal law and regulations.

"Automatic disbursement" means payment, by a financial institution to a licensee, of funds received pursuant to an allotment.

"Borrower" means any person in the United States military service obligated, directly or contingently, to repay a loan made by a licensee.

"Licensee" has the meaning set forth in § 6.2-1500 of the Code of Virginia.

C.1. No licensee shall require any allotment or automatic disbursement, or a borrower's execution of the Allotment Disclosure Form appended to this chapter, as a condition to making a loan under Chapter 15 (§ 6.2-1500 et seq.) of Title 6.2 of the Code of Virginia.

2. A licensee making an allotment program loan shall bear all costs and expenses incident to the allotment and automatic disbursement.

3. When making an allotment program loan, a licensee shall use the Allotment Disclosure Form appended to this chapter. The form shall be printed or typed without alteration on one side of a paper separate from all other papers or documents obtained by the licensee in type of size not less than that known as 12 point. All blanks on the form, other than those blanks to be filled in with the name of the licensee shall be filled in by the borrower and the filled-in form shall be signed and dated by the borrower. The completed form shall be kept in the separate loan file maintained with respect to the loan for the period specified in § 6.2-1533 of the Code of Virginia.

4. No licensee making an allotment program loan shall withhold any part of the proceeds of the loan to be applied to any payment required under the loan.

Attachment: Allotment Disclosure Form

ALLOTMENT DISCLOSURE FORM

1. I, (APPLICANT'S NAME), intend to apply for an allotment of my military pay in the amount of $(AMOUNT) per month to an account in my name at (FINANCIAL INSTITUTION).

2. I also intend to authorize disbursement of funds from my account at (FINANCIAL INSTITUTION) in the amount of $ (AMOUNT) per month for the purpose of making monthly payments on my loan with (FINANCE COMPANY).

3. I am authorizing the allotment and automatic disbursement voluntarily and solely for my own convenience, and acknowledge that (FINANCE COMPANY) has not required me to authorize the allotment or automatic disbursement, or to sign this form, as a condition to making me a loan.

4. I understand that I can cancel the allotment and automatic disbursement at any time, and understand that I am not obligated to pay any fee or charge to any person or company, directly or indirectly, for the allotment or automatic disbursement.

(Applicant's Signature)

(Date)

Statutory Authority

§§ 6.2-1535 of the Code of Virginia.

Historical Notes

Derived from VR225-01-0603, eff. April 1, 1989; amended, Volume 28, Issue 20, eff. June 1, 2012.

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