138.09(1a)(a)

(a) Banks, savings banks, savings and loan associations, trust companies, credit unions, or any of their affiliates.

138.09(7)

(7)

138.09(7)(gm)4.

4. Upon prepayment in full of a loan of $5,000 or more or a loan of less than $5,000 if for a term of 37 months or more, entered into on or after August 1, 1987, by cash, renewal, refinancing or otherwise, the borrower shall be entitled to a rebate of the unearned interest computed under s. 422.209 (2) (b) 1. or 2. The licensee may determine whether the rebate is computed under s. 422.209 (2) (b) 1. or 2. If the combined rebate of interest and credit insurance premiums otherwise required is less than $1, no rebate need be made. If the first payment period is greater than one month and additional interest is charged under par. (c) 2., the additional interest is earned on the first installment date and may not be considered in computing rebates.

138.09(1m)(c)

(c)

138.09

138.09 Licensed lenders.

138.09(1d)

(1d) In this section, “division” means the division of banking.

138.09(1m)

(1m)

138.09(1m)(b)

(b)

138.09(1m)(b)1.a.

a. If the applicant is an individual, the applicant’s social security number.

138.09(1m)(b)1.b.

b. If the applicant is not an individual, the applicant’s federal employer identification number.

138.09(7)(a)

(a) In this section:

138.09(7)(a)1.

1. “Precomputed loan” means a loan in which the debt is expressed as a sum comprising the principal and the amount of interest computed in advance.

138.09(7)(a)2.

2. “Principal” means the total of:

138.09(7)(a)2.a.

a. The amount paid to, received by or paid or payable for the account of the borrower; and

138.09(1a)

(1a) This section does not apply to any of the following:

138.09(1a)(b)

(b) Payday loans made under § 138.14.

138.09(1m)(a)

(a) Before any person may do business under this section, charge the interest authorized by sub. (7), or assess a finance charge on a consumer loan in excess of 18% per year, that person shall first obtain a license from the division. Applications for a license shall be in writing and upon forms provided for this purpose by the division. An applicant at the time of making an application shall pay to the division a nonrefundable $300 fee for investigating the application and a $500 annual license fee for the period terminating on the last day of the current calendar year. If the cost of the investigation exceeds $300, the applicant shall upon demand of the division pay to the division the amount by which the cost of the investigation exceeds the nonrefundable fee.

138.09(1m)(b)1.

1. Except as provided in par. (c), an application under par. (a) for a license shall contain the following:

138.09(1m)(b)2.

2. The division may not disclose any information received under subd. 1. to any person except as follows:

138.09(1m)(b)2.a.

a. The division may disclose information under subd. 1. to the department of revenue for the sole purpose of requesting certifications under § 73.0301.

138.09(1m)(b)2.b.

b. The division may disclose information under subd. 1. a. to the department of children and families in accordance with a memorandum of understanding under § 49.857.

138.09(1m)(c)1.

1. If an applicant who is an individual does not have a social security number, the applicant, as a condition of applying for or applying to renew a license, shall submit a statement made or subscribed under oath or affirmation to the division that the applicant does not have a social security number. The form of the statement shall be prescribed by the department of children and families.

138.09(1m)(c)2.

2. Notwithstanding sub. (b), any license issued or renewed in reliance upon a false statement submitted by an applicant under subd. 1. is invalid.

138.09(2)

(2) The division may also require the applicant to file with the division, and to maintain in force, a bond in which the applicant shall be the obligor, in a sum not to exceed $5,000 with one or more corporate sureties licensed to do business in Wisconsin, whose liability as such sureties shall not exceed the sum of $5,000 in the aggregate, to be approved by the division, and such bond shall run to the state of Wisconsin for the use of the state and of any person or persons who may have a cause of action against the obligor of the bond under the provisions of this section. Such bonds shall be conditioned that the obligor will conform to and abide by each and every provision of this section, and will pay to the state or to any person or persons any and all moneys that may become due or owing to the state or to such person or persons from the obligor under and by virtue of the provisions of this chapter.

138.09(3)

(3)

138.09(3)(a)

(a) Upon the filing of such application and the payment of such fee, the division shall investigate the relevant facts. Except as provided in para. (am), if the division shall find that the character and general fitness and the financial responsibility of the applicant, and the members thereof if the applicant is a partnership, limited liability company or association, and the officers and directors thereof if the applicant is a corporation, warrant the belief that the business will be operated in compliance with this section the division shall thereupon issue a license to said applicant to make loans in accordance with the provisions of this section. If the division shall not so find, the division shall deny such application.

138.09(3)(am)

(am) The division may not issue a license under this section to an applicant if any of the following applies:

138.09(3)(am)1.

1. The applicant fails to provide any information required under sub. (1m) (b).

138.09(3)(am)2.

2. The department of revenue certifies under § 73.0301 that the applicant is liable for delinquent taxes.

138.09(3)(am)3.

3. The applicant fails to comply, after appropriate notice, with a subpoena or warrant issued by the department of children and families or a county child support agency under § 59.53 (5) and related to paternity or child support proceedings.

138.09(3)(e)

(e)

138.09(3)(e)1.d.

d. An insurance business.

138.09(4)

(4)

138.09(6)

(6)

138.09(3)(am)4.

4. The applicant is delinquent in making court-ordered payments of child or family support, maintenance, birth expenses, medical expenses or other expenses related to the support of a child or former spouse, as provided in a memorandum of understanding entered into under § 49.857.

138.09(3)(b)

(b) Every license shall remain in force and effect until suspended or revoked in accordance with this section or surrendered by the licensee, and every licensee shall, on or before each December 10, pay to the division the annual license fee for the next succeeding calendar year.

138.09(3)(c)

(c) Such license shall not be assignable and shall permit operation under it only at or from the location specified in the license at which location all loans shall be consummated, but this provision shall not prevent the licensee from making loans under this section which are not initiated or consummated by face to face contact away from the licensed location if permitted by the division in writing or by rule or at an auction sale conducted or clerked by a licensee.

138.09(3)(d)

(d) A separate license shall be required for each place of business maintained by the licensee. Whenever a licensee shall change the address of its place of business to another location within the same city, village or town the licensee shall at once give written notice thereof to the division, which shall replace the original license with an amended license showing the new address, provided the location meets with the requirements of para. (e). No change in the place of business of a licensee to a different city, village or town shall be permitted under the same license.

138.09(3)(e)1.

1. Except as provided in subd. 2., a licensee may conduct, and permit others to conduct, at the location specified in its license, any one or more of the following businesses not subject to this section:

138.09(3)(e)1.a.

a. A business engaged in making loans for business or agricultural purposes or exceeding $25,000 in principal amount, except that all such loans having terms of 49 months or more are subject to sub. (7) (gm) 2. or 4.

138.09(3)(e)1.b.

b. A business engaged in making first lien real estate mortgage loans under §§ 138.051 to 138.06.

138.09(3)(e)1.c.

c. A loan, finance or discount business under §§ 218.0101 to 218.0163.

138.09(3)(e)1.e.

e. A currency exchange under § 218.05.

138.09(3)(e)1.f.

f. A seller of checks business under ch. 217.

138.09(3)(e)1.g.

g. A payday loan licensee under § 138.14.

138.09(3)(e)2.

2. A licensee may not sell merchandise or conduct other business at the location specified in the license unless written authorization is granted to the licensee by the division.

138.09(3)(f)

(f) Every licensee shall make an annual report to the division for each calendar year on or before March 15 of the following year. The report shall include business transacted by the licensee under the provisions of this section and shall give all reasonable and relevant information that the division may require. The reports shall be made in the form and manner prescribed by the division. Any licensee operating under this section shall keep the records affecting loans made pursuant to this section separate and distinct from the records of any other business of the licensee.

138.09(4)(a)

(a) The division for the purpose of discovering violations of this chapter may cause an investigation to be made of the business of the licensee transacted under this section, and shall cause an investigation to be made of convictions reported to the division by any district attorney for violation by a licensee of this chapter. The place of business, books of account, papers, records, safes and vaults of said licensee shall be open to inspection and examination by the division for the purpose of such investigation and the division may examine under oath all persons whose testimony the division may require relative to said investigation. The division may, upon notice to the licensee and reasonable opportunity to be heard, suspend or revoke such license after such hearing if any of the following applies:

138.09(4)(a)1.

1. The licensee has violated any provision of this chapter and if the division determines such violation justifies the suspension or revocation of the license.

138.09(4)(a)2.

2. Any fact or condition exists which, if it had existed at the time of the original application for such license, would have warranted the division in refusing to issue such license.

138.09(4)(a)3.

3. The licensee has failed to pay the annual licensee fee or to maintain in effect the bond, if any, required under sub. (2).

138.09(4)(c)

(c) The division shall revoke a license under this section if the department of revenue certifies that the licensee is liable for delinquent taxes under § 73.0301. A licensee whose license is revoked under this paragraph for delinquent taxes is entitled to a hearing under § 73.0301 (5)(a) but is not entitled to a hearing under para. (a).

138.09(4)(b)

(b) The division shall restrict or suspend a license under this section if, in the case of a licensee who is an individual, the licensee fails to comply, after appropriate notice, with a subpoena or warrant issued by the department of children and families or a county child support agency under § 59.53 (5) and related to paternity or child support proceedings or is delinquent in making court-ordered payments of child or family support, maintenance, birth expenses, medical expenses or other expenses related to the support of a child or former spouse, as provided in a memorandum of understanding entered into under § 49.857. A licensee whose license is restricted or suspended under this paragraph is entitled to a notice and hearing only as provided in a memorandum of understanding entered into under § 49.857 and is not entitled to a hearing under para. (a).

138.09(4)(d)

(d) The cost of any investigation, examination, or hearing, including witness fees or any other expenses, conducted by the division under this section shall be paid by the licensee so examined within 30 days after demand therefor by the division, and the state may maintain an action for the recovery of such costs and expenses.

138.09(5)

(5) No licensee shall advertise, print, display, publish, distribute or broadcast or cause to be printed, displayed, published, distributed or broadcast in any manner any statement with regard to the rates, terms or conditions for the lending of money, credit, goods or things in action which is false or calculated to deceive. With respect to matters specifically governed by § 423.301, compliance with such section satisfies the requirements of this section.

138.09(6)(a)

(a) Except as provided in para. (b), the licensee shall keep such books and records in the licensee’s place of business as in the opinion of the division will enable the division to determine whether the provisions of this chapter are being observed. Every such licensee shall preserve the records of final entry used in such business, including cards used in the card system, if any, for a period of at least 2 years after the making of any loan recorded therein.

138.09(6)(b)

(b) A licensee may keep the books and records specified in para. (a) at a single location inside or outside of this state if the books and records are kept at a location licensed under this section. The licensee shall organize the books and records by the place of business where the records originated and shall keep the books and records separate from other records for business conducted at that location. Actual costs incurred by the division to examine books and records maintained outside of this state shall be paid by the licensee.

138.09(7)(a)2.b.

b. To the extent that payment is deferred: the amount actually paid or to be paid by the licensee for registration, certificate of title or license fees if not included in subd. 2. a.; and additional charges permitted under this section.

138.09(7)(b)

(b) A licensee may charge, contract for or receive a rate of interest for a loan or forbearance made prior to April 6, 1980, which does not exceed the greater of either of the following:

138.09(7)(b)1.

1. With respect to installment loans or forbearances which are repayable in substantially equal successive installments at approximately equal intervals, and where the principal does not exceed $3,000 excluding any interest authorized under this section, and where the scheduled maturity of the loan contract is not more than 36 months and 15 days from the date of making, interest may be deducted in advance at a rate not in excess of $9.50 per $100 per year on that part of the loan not exceeding $1,000 and $8 per $100 per year on any remainder. Interest shall be computed at the time the loan is made on the face amount of the contract for the full term of the contract, notwithstanding the requirement for installment repayments. The face amount of the loan contract or note may exceed $3,000 by the amount of interest deducted in advance. On contracts which are one year or any number of whole years, the charge shall be computed proportionately on even calendar months.

138.09(7)(b)2.

2. With respect to any loan of any amount, at a rate not to exceed 18% per year computed on the declining unpaid principal balances of the loan from time to time outstanding, calculated according to the actuarial method, but this does not limit or restrict the manner of contracting for the interest, whether by way of add-on, discount or otherwise, so long as the rate of interest does not exceed that permitted by this paragraph.

138.09(7)(bm)

(bm) A licensee may charge, contract for or receive a rate of interest for a loan or forbearance made on or after April 6, 1980 and prior to November 1, 1981, which does not exceed the greater of either of the following:

138.09(7)(bm)1.

1. With respect to installment loans or forbearances which are repayable in substantially equal successive installments at approximately equal intervals, and where the principal does not exceed $3,000 excluding any interest authorized under this section, and where the scheduled maturity of the loan contract is not more than 36 months and 15 days from the date of making, interest may be deducted in advance at a rate not in excess of $9.50 per $100 per year on that part of the loan not exceeding $2,000 and $8 per $100 per year on any remainder. Interest shall be computed at the time the loan is made on the face amount of the contract for the full term of the contract, notwithstanding the requirement for installment repayments. The face amount of the loan contract or note may exceed $3,000 by the amount of interest deducted in advance. On contracts which are one year or any number of whole years, the charge shall be computed proportionately on even calendar months.

138.09(7)(bm)2.

2. With respect to any loan of any amount, at a rate not to exceed 19% per year computed on the declining unpaid principal balances of the loan from time to time outstanding, calculated according to the actuarial method, but this does not limit or restrict the manner of contracting for the interest, whether by way of add-on, discount or otherwise, so long as the rate of interest does not exceed that permitted by this paragraph.

138.09(7)(bn)

(bn)

138.09(7)(bn)1.

1. A licensee may charge, contract for or receive a rate of interest, calculated according to the actuarial method, which may not exceed the greater of the following for a loan or forbearance of less than $3,000 entered into on or after November 1, 1981 and before November 1, 1984:

138.09(7)(bn)1.a.

a. Twenty-three percent per year.

138.09(7)(bn)1.b.

b. A rate of 6% in excess of the interest rate applicable to 2-year U.S. treasury notes as determined under subd. 3. a.

138.09(7)(bn)2.a.

a. Twenty-one percent per year.

138.09(7)(bn)3.

3.

138.09(7)(bp)

(bp) A loan, whether precomputed or based upon the actuarial method, made after October 31, 1984, is not subject to any maximum interest rate limit.

138.09(7)(c)

(c)

138.09(7)(bn)1.c.

c. A rate of 6% in excess of the interest rate applicable to 6-month U.S. treasury bills as determined under subd. 3. b.

138.09(7)(bn)2.

2. A licensee may charge, contract for or receive a rate of interest, calculated according to the actuarial method, which may not exceed the greater of the following for a loan or forbearance of $3,000 or more entered into on or after November 1, 1981 and before November 1, 1984:

138.09(7)(bn)2.b.

b. A rate of 6% in excess of the interest rate applicable to 2-year U.S. treasury notes as determined under subd. 3. a.

138.09(7)(bn)2.c.

c. A rate of 6% in excess of the interest rate applicable to 6-month U.S. treasury bills as determined under subd. 3. b.

138.09(7)(bn)3.a.

a. For purposes of subds. 1. b. and 2. b., the interest rate applicable to 2-year U.S. treasury notes for any calendar year quarter is the average annual interest rate determined by the last auction of the notes in the preceding calendar year quarter, increased to the next multiple of 0.5% if the average annual interest rate includes a fractional amount.

138.09(7)(bn)3.b.

b. For purposes of subds. 1. c. and 2. c., the interest rate applicable to 6-month U.S. treasury bills for any month is the average annual discount interest rate determined by the last auction of the bills in the preceding month, increased to the next multiple of 0.5% if the average annual discount interest rate includes a fractional amount.

138.09(7)(bn)4.

4. Information regarding the amount of the maximum finance charge under subds. 1. and 2. for any month or calendar year quarter shall be available at the office of the division.

138.09(7)(bn)5.

5. This paragraph does not restrict the manner of contracting for interest, whether by add-on, discount or otherwise, if the interest rate does not exceed the rate under this paragraph.

138.09(7)(c)1.

1. Where the interest is precomputed, the interest may be calculated on the assumption that all scheduled payments will be made when due and the effect of prepayment is governed by the provision on rebate upon prepayment. If a loan is prepaid out of the proceeds of a new loan made under this section, the principal of such new loan may include any unpaid charges on the prior loan which have accrued before the making of the new loan, unless the prior loan was precomputed in which event the principal of the new loan may include the balance remaining after making the required rebate plus any accrued charges.

138.09(7)(c)2.

2. For the purpose of computing interest under this section, whether at the maximum rate or less, a day shall be considered one-thirtieth of a month when such computation is made for a fraction of a month. Loan contracts providing for installments payable at monthly intervals may provide for a first period between the date of the contract and the first installment due date of not more than 45 days and not less than 15 days. Where the first period is greater or lesser than one month, interest may be charged only for each day in the first period, at a rate not to exceed one-thirtieth of the interest which would be applicable to a first installment period of one month, but such first period may be considered a monthly interval for purposes of determining rebates. Where the first period is greater than one month, any additional interest charge shall be earned and may be added to and collected at the time of the first installment payment.

138.09(7)(c)3.

3. In lieu of deducting the interest and charging the delinquency and deferral charges authorized in this section, a licensee may contract for and receive a rate of charge not exceeding that rate which, computed on scheduled unpaid balances of the proceeds of the loan contract, would produce an amount of charge equal to the total of the interest which may be deducted from such loan contract under this section, and such rate of charge may be computed on actual unpaid principal balances from time to time outstanding until the loan is fully paid. When such rate of charge is made in lieu of other charges, the provisions relating to refunds and delinquency charges shall not apply to such loans.

138.09(7)(c)4.

4. If 2 installments or parts thereof of a precomputed loan are not paid on or before the 10th day after their scheduled or deferred due dates, a licensee may elect to convert the loan from a precomputed loan to one in which the interest is computed on unpaid balances actually outstanding. In this event the licensee shall make a rebate pursuant to the provisions on rebate upon prepayment as of the due date of an unpaid installment, and thereafter may charge interest from the due date as provided in subd. 3. or by par. (b) 2. and no further delinquency or deferral charges shall be made. The rate of interest may equal but not exceed the annual percentage rate of finance charge which was disclosed to the borrower when the loan was made. The rate of interest shall be computed on actual unpaid balances of the contract as reduced by the rebate for the time that such balances are actually outstanding from the due date as of which the rebate was made until the contract is fully paid.

138.09(7)(d)

(d)

138.09(7)(d)1.

1. No loan of $3,000 or less, excluding interest, scheduled to be repaid in substantially equal installments at equal periodic intervals shall provide for a scheduled repayment of principal more than 36 months and 15 days from the date of the contract if the principal exceeds $700, nor more than 24 months and 15 days from the date of the contract if the principal is $700 or less.

138.09(7)(d)2.

2. A licensee may make loans under a continuing loan agreement which provides for future or additional advances under the same instrument if at the time of each new advance of money, any existing unpaid balance is reduced by any required rebate and the resulting amount plus the additional money advanced plus interest, official fees and premiums or identifiable charges for insurance, if any, are combined, and for the purpose of the limitations of subd. 1. only, the date of the loan contract shall be deemed the date of said advance.

138.09(7)(e)

(e)

138.09(7)(e)1.

1. With respect to a precomputed loan which is scheduled to be repaid in substantially equal installments, the parties may agree to a delinquency charge on any installment not paid in full on or before the 10th day after its scheduled or deferred due date, in an amount not to exceed 5% of the unpaid amount of the installment. The delinquency charge may be collected only once on any one installment but may be collected when due or at any time thereafter.

138.09(7)(f)

(f)

138.09(7)(gm)

(gm)

138.09(7)(i)

(i) In addition to interest, the licensee may charge:

138.09(7)(e)2.

2. With respect to other loans the delinquency charge shall not exceed the rate allowed under para. (b), computed upon the unpaid principal balance exclusive of interest on the loan.

138.09(7)(e)3.

3. Notwithstanding subds. 1. and 2., delinquency charges on precomputed consumer loans shall be governed by § 422.203.

138.09(7)(f)1.

1. Subject to subds. 2. and 3., with respect to a precomputed loan, the parties before or after default may agree in writing to a deferral of all or part of any unpaid installment, and the licensee may make and collect a charge computed in the same manner as the deferral charge computed in accordance with § 422.204 (1) to (5) whether or not the loan under this section is a consumer loan.

138.09(7)(f)2.

2. In addition to the deferral charge, the licensee may make appropriate additional charges. The amount of such charges which is not paid in cash may be added to the amount deferred for the purpose of calculating the deferral charge.

138.09(7)(f)3.

3. The parties may agree in writing at any time, including at the time of a precomputed loan that if an installment is not paid within 30 days after its due date, the licensee may grant a deferral and make charges under this section, if a notice is sent to the customer advising the customer of the amount of the deferral charge, the period of deferral and that if the installment is prepaid before maturity that a proportionate refund of the deferral charge will be given. No deferral charge may be made for a period after the date that such a lender elects to accelerate the maturity of the agreement.

138.09(7)(f)4.

4. Notwithstanding subds. 1., 2. and 3., deferral charges on precomputed consumer loans shall be governed by § 422.204.

138.09(7)(g)

(g) Except as provided in para. (gm), upon prepayment in full by cash, renewal, refinancing or otherwise, the borrower shall be entitled to a rebate of the unearned interest as provided in this paragraph. If the combined rebate of interest and credit insurance premiums otherwise required is less than $1, no rebate need be made. The refunds shall be determined as follows:

138.09(7)(g)1.

1. On a loan where the interest is precomputed and which is repayable in substantially equal successive installments at approximately equal intervals, whether or not the precomputed loan is a consumer loan, the amount of rebate shall be computed under § 422.209 (2)(a) except for any additional interest charge covered under subd. 3.

138.09(7)(g)2.

2. For any other loan, the amount of the rebate of interest shall not be less than the difference between the interest charged and the interest earned at the agreed rate computed upon the unpaid principal balances, exclusive of interest, of the transaction prior to payment in full.

138.09(7)(g)3.

3. If the first payment period is greater than one month and additional interest is charged as permitted under par. (c) 2., the additional interest charged for the extension of the first payment period is considered wholly earned on the first installment date and is not considered in computing rebates.

138.09(7)(gm)1.

1. Upon prepayment in full of a loan entered into on or after November 1, 1981 and before November 1, 1984, and which has a term of less than 49 months, by cash, renewal, refinancing or otherwise, the borrower shall be entitled to a rebate of the unearned interest as provided in this paragraph. If the combined rebate of interest and credit insurance premiums otherwise required is less than $1, no rebate need be made. The refunds shall be determined as follows:

138.09(7)(gm)1.a.

a. On a loan where the interest is precomputed and which is repayable in substantially equal successive installments at approximately equal intervals, the amount of rebate shall be computed under § 422.209 (2)(a) except for any additional interest charge under par. (c) 2.

138.09(7)(gm)1.b.

b. For any other loan, the amount of the rebate of interest may not be less than the difference between the interest charged and the interest earned at the agreed rate, computed upon the unpaid principal balance.

138.09(7)(gm)1.c.

c. If