New York Codes, Rules and Regulations
Title 3 - BANKING
Chapter III - SUPERINTENDENT'S REGULATIONS
Subchapter B - NON-BANKING ORGANIZATIONS
Part 401 - Licensed Lenders
Section 401.5 - Loans, books and records

Universal Citation: 3 NY Comp Codes Rules and Regs ยง 401.5

Current through Register Vol. 46, No. 12, March 20, 2024

(a) When payment is received on any loan, entry shall be made in the licensee's record of the borrower's account as follows:

(1) on a simple interest loan-the date of payment, the amount applied to interest, the amount credited to principal and the unpaid principal balance; and

(2) on a precomputed interest loan-the date of payment, any amount applied to default or deferment charges, the amount applied to the total unpaid balance and the total unpaid balance.

(b) The application for any loan and all original papers relating to it shall be filed so as to be readily available for inspection at any time, except those papers returned to the borrower on paid- up accounts. All such papers and instruments shall bear the number of the loan to which they relate.

(c) Every licensee shall keep, for at least two years, a record which will readily disclose the number, date and amount financed of all loans granted to each borrower, and the unpaid principal balance of each such loan which is paid by a new loan or the date of final payment when it is paid in any other manner. All such information with respect to each loan shall be recorded on one line and may be incorporated with existing records. An example showing the information desired follows:

John Jones

15 Court Street, Troy, NY

Number Date Amount Financed Unpaid principal paid by new loan or date paid
17496 6-19-60 $400 $250.00
19102 12-5-60 800 629.97
19901 6-6-61 600 9-2-61

(d) In lieu of the loan history record prescribed above, for each open-end loan agreement, the licensee shall keep, for at least two years, one record from which may be readily determined the name, address and account number of the borrower, the date upon which the credit was initially established, the amount of such initial credit, each date upon which an additional credit was made available, the amount of such additional credit, and the amount of the unpaid balance as of each date upon which an additional credit was made available.

(e) With respect to any loan, whether charged off or not, for which a licensee maintains records in accord with section 349 of the Banking Law, every licensee shall record all information relating to the borrower's account including:

(1) the date upon which an attorney has been asked to commence legal action;

(2) the date upon which any legal action (including steps to collect by means of garnishees or attachments of salary) or summary action is taken for or against the licensee, and its nature;

(3) the date upon which judgment is obtained with respect to any signer or endorser;

(4) the date and terms of any settlement agreed upon as a result of any legal or summary action taken for or against the lender;

(5) the nature of any collection expense or expense incurred by the lender in connection with litigation, charged to or paid by any obligor; and

(6) the date upon which the lender's attorney discontinues efforts to collect by legal action.

All information required to be maintained pursuant to this subdivision shall be readily accessible for review and examination by the superintendent.

(f) Whenever a precomputed interest loan is prepaid in full in cash or by refinancing or otherwise, before the final installment date, the licensee's record of the borrower's account shall disclose the amount owing on the loan at the time of such prepayment (including default or deferment charges if any), and any refund paid or credited to the account by reason of such prepayment and the licensee shall deliver to the borrower at the time of such prepayment a record disclosing the information required by this subdivision.

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