South Carolina General Assembly
115th Session, 2003-2004

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Bill 4077

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(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

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COMMITTEE REPORT

May 28, 2003

H. 4077

Introduced by Reps. Cato and Tripp

S. Printed 5/28/03--H.

Read the first time April 24, 2003.

            

THE COMMITTEE ON

LABOR, COMMERCE AND INDUSTRY

To whom was referred a Bill (H. 4077) to amend Section 38-39-80, Code of Laws of South Carolina, 1976, relating to the method used for calculating the unearned service charge refund if the borrower, etc., respectfully

REPORT:

That they have duly and carefully considered the same and recommend that the same do pass:

HARRY F. CATO for Committee.

            

STATEMENT OF ESTIMATED FISCAL IMPACT

ESTIMATED FISCAL IMPACT ON GENERAL FUND EXPENDITURES:

$0 (No additional expenditures or savings are expected)

ESTIMATED FISCAL IMPACT ON FEDERAL & OTHER FUND EXPENDITURES IS:

$0 (No additional expenditures or savings are expected)

EXPLANATION OF IMPACT:

The Department of Insurance has indicated this bill would not have any impact on the department, the General Fund of the State, or on federal and/or other funds.

Approved By:

Don Addy

Office of State Budget

A BILL

TO AMEND SECTION 38-39-80, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE METHOD USED FOR CALCULATING THE UNEARNED SERVICE CHARGE REFUND IF THE BORROWER CANCELS BEFORE MATURITY OF A PREMIUM SERVICE AGREEMENT, SO AS TO CHANGE THE METHOD OF CALCULATING THE AMOUNT OF REFUND.

Be it enacted by the General Assembly of the State of South Carolina:

SECTION    1.    Section 38-39-80(e) of the 1976 Code is amended to read:

"(e)    The service charge is at the rate of one percent per each month computed on the remainder of the outstanding balance. However, in the event of cancellation by if the borrower prior to cancels before maturity of the contract, the unearned service charge must be refunded on a short rate basis as determined by the department by a method at least as favorable to the borrower as the Rule of 78s. With respect to the service charge for a premium service agreement which is for other than personal, family, or household purposes, the parties may contract for the payment by the debtor of a service charge at any rate, but no rate charged hereunder may be unconscionable. 'Unconscionable' is defined as a rate substantially exceeding the usual and customary charge for financing insurance premiums."

SECTION    2.    This act takes effect upon approval by the Governor.

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