31.45.010 - Definitions.

Definitions.

Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

     (1) "Applicant" means a person that files an application for a license under this chapter, including the applicant's sole proprietor, owners, directors, officers, partners, members, and controlling persons.

     (2) "Borrower" means a natural person who receives a small loan.

     (3) "Business day" means any day that the licensee is open for business in at least one physical location.

     (4) "Check" means the same as defined in RCW 62A.3-104(f) and, for purposes of conducting the business of making small loans, includes other electronic forms of payment, including stored value cards, internet transfers, and automated clearing house transactions.

     (5) "Check casher" means an individual, partnership, unincorporated association, or corporation that, for compensation, engages, in whole or in part, in the business of cashing checks, drafts, money orders, or other commercial paper serving the same purpose.

     (6) "Check seller" means an individual, partnership, unincorporated association, or corporation that, for compensation, engages, in whole or in part, in the business of or selling checks, drafts, money orders, or other commercial paper serving the same purpose.

     (7) "Collateral" means the same as defined in chapter 62A.9A RCW.

     (8) "Controlling person" means a person owning or controlling ten percent or more of the total outstanding shares of the applicant or licensee, if the applicant or licensee is a corporation, and a member who owns ten percent or more of a limited liability company or limited liability partnership.

     (9) "Default" means the borrower's failure to repay the small loan in compliance with the terms contained in the small loan agreement or note or failure to pay any installment plan payment on an installment plan within ten days after the date upon which the installment was scheduled to be paid.

     (10) "Director" means the director of financial institutions.

     (11) "Financial institution" means a commercial bank, savings bank, savings and loan association, or credit union.

     (12) "Installment plan" is a contract between a licensee and borrower that provides that the loaned amount will be repaid in substantially equal installments scheduled on or after a borrower's pay dates and no less than fourteen days apart.

     (13) "Licensee" means a check casher or seller licensed by the director to engage in business in accordance with this chapter. For purposes of the enforcement powers of this chapter, including the power to issue cease and desist orders under RCW 31.45.110, "licensee" also means a check casher or seller who fails to obtain the license required by this chapter.

     (14) "Loaned amount" means the outstanding principal balance and any fees authorized under RCW 31.45.073 that have not been paid by the borrower.

     (15) "Origination date" means the date upon which the borrower and the licensee initiate a small loan transaction.

     (16) "Outstanding principal balance" of a small loan means any of the principal amount that has not been paid by the borrower.

     (17) "Paid" means that moment in time when the licensee deposits the borrower's check or accepts cash for the full amount owing on a valid small loan. If the borrower's check is returned by the borrower's bank for insufficient funds, the licensee shall not consider the loan paid.

     (18) "Person" means an individual, partnership, association, limited liability company, limited liability partnership, trust, corporation, and any other legal entity.

     (19) "Principal" means the loan proceeds advanced for the benefit of the borrower in a small loan, excluding any fee or interest charge.

     (20) "Rescission" means annulling the loan contract and, with respect to the small loan contract, returning the borrower and the licensee to their financial condition prior to the origination date of the loan.

     (21) "Small loan" means a loan of up to the maximum amount and for a period of time up to the maximum term specified in RCW 31.45.073.

     (22) "Termination date" means the date upon which payment for the small loan transaction is due or paid to the licensee, whichever occurs first.

     (23) "Total of payments" means the principal amount of the small loan plus all fees or interest charged on the loan.

     (24) "Trade secret" means the same as defined in RCW 19.108.010.

[2009 c 510 § 2; 2003 c 86 § 1; 1995 c 18 § 1; 1994 c 92 § 274; 1993 c 143 § 1; 1991 c 355 § 1.]

Notes: Finding -- Intent -- Liberal construction -- 2009 c 510: "The legislature finds that some small loan borrowers are unable to pay the entire loaned amount when it is due. Many of these borrowers take out multiple loans to pay off the original borrowed sum.

     It is the legislature's intent to reduce or limit the number of borrowers taking out multiple loans by providing for installment plans that give a borrower a better opportunity to pay off their original small loan without having to resort to taking out a subsequent loan or loans.

     This act shall be liberally construed to effectuate the legislature's intent to protect borrowers." [2009 c 510 § 1.]