Washington State Department of Financial Institutions

Consumer Loan Act Interpretive Letters Archive

2003-1999 | 1998 | 1997 | 1996 | 1995 | 1993-1992

The opinions expressed in the interpretive letters are informal and non-binding. These opinions reflect the position of the Division of Consumer Services (DCS) at the time they were produced. The DCS could learn of additional facts, which would cause us to change our position. The letters may also contain policy statements providing a written description of the current approach of DCS to implementation of a statute or other provision of law.

Readers are cautioned that the opinions in both the interpretive letters and policy statements may have changed because of statute or rule revisions or other additional facts presented. Consult your attorney for advice regarding the current state of the law and how it may apply to the issue or situation you have in mind.

Withdrawn Letters: View interpretive letters that have been withdrawn by the Division of Consumer Services.

Note: Only letters directed to all consumer loan companies and other interested parties are available by "hyperlink" from this page. If the letter you're interested in does not have a live hyperlink to the letter text, you may order a copy using the Public Records Request Form.


1998 Interpretive Letters

Number 98-01CL
Date 1-29-98
Statute 31.04 (19.146)
Subject Consumer Loan license requirements when originating loans secured by and closed in the name of a bank.
Summary Answers a series of questions regarding an apparent gap in laws covering license requirements for Mortgage Brokers when brokering loans for Banks with the loans closing in the name of the Bank; in the name of the broker; with APRs under 12 percent; with APRs over 12 percent.

[See also Question/Answer #3 in the letter - WJ]


Number 98-02CL
Date 2-17-98
Statute 31.04 (19.146)
Subject Requirements for a Consumer Loan licensee who wants to appoint a non-consumer lender as an agent for the purpose of using the non-licensee employees to originate loans.
Summary The Consumer Loan Act licensee can only originate loans from licensed locations. The Consumer Loan licensee may employ the services of any person operating under its name and Surety Bond to originate loans on its behalf. [WKB]

Number 98-03CL
Date 2-17-98
Statute 31.04 (19.146)
Subject Consumer Loan/MB license requirements when originating loans secured by and closed in the name of a wholesaler.
Summary Answers a series of questions regarding an apparent gap in laws covering license requirements for Mortgage Brokers when brokering loans for Banks with the loans closing in the name of the Bank; in the name of the broker; with APRs under 12 percent; with APRs over 12 percent.

[See also Question/Answer #3 in the letter. [WKB]


Number 98-04CL
Date 4-14-98
Statute 31.04.125(1)
Subject Are loans secured by assignment of seller’s interest subject to the 6 years and 15 days term limitation?
Summary No. Loans secured by the assignment of seller’s interest can be treated as loans secured by real estate or personal property, since the assignee has a lien against the real estate or personal property.

Number 98-05CL
Date 4-22-98
Statute 31.04.105(3)
Subject Advice of HB2123 expanding third party fees.
Summary RCW 31.04.105(3) expanded to allow the payment of fees to third parties other than the licensee who provide goods or services to the licensee in connection with the preparation of the borrower’s loan, including, but not limited to, credit reporting agencies, title companies, appraisers, structural and pest inspectors, and escrow companies. Fees must be actually paid to the third party

Number 98-06CL
Date 5-21-98
Statute Indirect Lending
Subject Indirect Home Lending
Summary A company that makes indirect loans to Washington citizens is presumed to be purchasing installment contracts, and this type of lending is not subject to the licensing requirements of the Consumer Loan Act. Lender must lend directly to consumers in WA state and must charge interest higher than allowed by the interest usury statute to be subject to the Consumer Loan Act.

Number 98-07CL
Date 5-21-98
Statute 31.04.135 and 208-620-160
Subject Advertising Requirements
Summary A licensee does not have to indicate in its advertisements on Radio and TV the authority under which it originates its loans.

Number 98-08CL
Date 5-28-98
Statute 31.04.035 & 31.04.105
Subject Requirements for Direct Financing for used auto dealers
Summary The used auto dealer who intends to take advantage of the rate authorized under the CLA act needs to obtain a license; and would come under the jurisdiction of the DFI

Number 98-09CL
Date 10-13-98
Statute 31.04.010(7)
Subject Required Method of Calculating Interest on loan subject to Act.
Summary The definition of "simple interest" requires applying the annual percentage interest rate or its periodic equivalent to the unpaid balances of the principal of the loan outstanding for the time outstanding.

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