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chapter-16a•Chapter 16a — Consumer Credit Code
Unofficial online text published by the Kansas Office of Revisor of Statutes; the printed volumes of the Kansas Statutes Annotated are the authoritative version. Current through the 2025 session laws.
K.S.A. 16a-1-101 et seq., and amendments thereto, shall be known and may be cited as the uniform consumer credit code.
History: L. 1973, ch. 85, § 1; L. 2024, ch. 6, § 28; January 1, 2025.
(1) K.S.A. 16a-1-101 et seq., and amendments thereto, shall be liberally construed and applied to promote its underlying purposes and policies.
(2) The underlying purposes and policies of this act are:
(a) To simplify, clarify and modernize the law governing consumer credit transactions;
(b) to protect consumers against unfair practices; and
(c) to facilitate sound consumer credit practices.
(3) A reference to a requirement imposed by K.S.A. 16a-1-101 et seq., and amendments thereto, includes reference to a rule and regulation adopted by the administrator pursuant to this act.
History: L. 1973, ch. 85, § 2; L. 1981, ch. 93, § 2; L. 1988, ch. 85, § 1; L. 2024, ch. 6, § 29; January 1, 2025.
The uniform consumer credit code, K.S.A. 16a-1-101 et seq., and amendments thereto, takes precedence in consumer credit transactions, the uniform commercial code and the principles of law and equity, including the law relative to capacity to contract, principal and agent, estoppel, fraud, misrepresentation, duress, coercion, mistake, bankruptcy or other validating or invalidating cause supplement its provisions.
History: L. 1973, ch. 85, § 3; L. 2024, ch. 6, § 30; January 1, 2025.
K.S.A. 16a-1-101 et seq., and amendments thereto, being a general act intended as a unified coverage of its subject matter, no part of it shall be deemed to be implicitly repealed by subsequent legislation if such construction can reasonably be avoided.
History: L. 1973, ch. 85, § 4; L. 2024, ch. 6, § 31; January 1, 2025.
If any provision of this act or the application thereof to any person or circumstances is held invalid, the invalidity does not affect other provisions or applications of this act which can be given effect without the invalid provision or application, and to this end the provisions of this act are severable.
History: L. 1973, ch. 85, § 5; January 1, 1974.
Revisor's Note: Section 1-106 of the Uniform Consumer Credit Code was not enacted in Kansas in 1973.
(1) Except as otherwise provided in K.S.A. 16a-1-101 et seq., and amendments thereto, a consumer may not waive or agree to forego rights or benefits under this act.
(2) A claim by a consumer against a creditor for any violation of K.S.A. 16a-1-101 et seq., and amendments thereto, or civil penalty a claim against a consumer for default or breach of a duty imposed by this act, if disputed in good faith, may be settled by agreement.
(3) A claim against a consumer may be settled for less value than the amount claimed.
(4) A settlement in which the consumer waives or agrees to forego rights or benefits under K.S.A. 16a-1-101 et seq., and amendments thereto, is invalid if the court as a matter of law finds the settlement to have been unconscionable at the time it was made. The competence of the consumer, any deception or coercion practiced upon the consumer, the nature and extent of the legal advice received by the consumer, and the value of the consideration are relevant to the issue of unconscionability.
History: L. 1973, ch. 85, § 6; L. 2024, ch. 6, § 32; January 1, 2025.
(1) K.S.A. 16a-1-101 et seq., and amendments thereto, prescribes maximum charges for all creditors, except lessors and those excluded by K.S.A. 16a-1-202, and amendments thereto, extends consumer credit including consumer credit sales and consumer loans, and displaces existing limitations on the powers of those creditors based on maximum charges.
(2) With respect to sellers of goods or services, licensed lenders, consumer and sales finance companies, industrial banks, loan companies, commercial banks and trust companies, this act displaces existing limitations on their powers based solely on amount or duration of credit.
(3) Except as provided in subsection (1) and K.S.A. 16a-1-101 et seq., and amendments thereto, does not displace limitations on powers of credit unions, savings banks, savings and loan associations or other thrift institutions.
(4) Except as provided in K.S.A. 16a-1-101 et seq., and amendments thereto, does not displace:
(a) Limitations on powers of supervised financial organizations with respect to the amount of a loan to a borrower or other similar restrictions designed to protect deposits; or
(b) limitations on powers an organization is authorized to exercise under the laws of this state or the United States.
History: L. 1973, ch. 85, § 7; L. 1981, ch. 93, § 3; L. 1993, ch. 200, § 2; L. 1999, ch. 107, § 6; L. 2024, ch. 6, § 33; January 1, 2025.
The parties to a sale, lease or loan or modification thereof that is not a consumer credit transaction may agree in a writing signed by the parties that the transaction is subject to the provisions of K.S.A. 16a-1-101 et seq., and amendments thereto. If the parties so agree, the transaction is a consumer credit transaction for the purposes of K.S.A. 16a-1-101 et seq., and amendments thereto.
History: L. 1973, ch. 85, § 8; L. 2024, ch. 6, § 34; January 1, 2025.
(1) Except as otherwise provided in this section, K.S.A. 16a-1-101 et seq., and amendments thereto, apply to consumer credit transactions made in Kansas. For purposes of such sections of this act, a consumer credit transaction is made in Kansas if:
(a) A written agreement executed by electronic or physical signature evidencing the obligation or offer of the consumer is received by the creditor from a consumer in Kansas; or
(b) the creditor induces the consumer who is a resident of Kansas to enter into the transaction by solicitation in Kansas by any means, including, but not limited to: Mail, telephone, radio, television, electronic mail, internet or any other electronic means.
(2) Except as provided in subsection (5), a consumer credit transaction made in a state outside of Kansas to a person who was not a resident of Kansas when the sale, lease, loan or modification was made is valid and enforceable in Kansas according to its terms to the extent that it is valid and enforceable under the laws of the state applicable to the transaction.
(3) Notwithstanding other provisions of this section, except as provided in subsection (5), K.S.A. 16a-1-101 et seq., and amendments thereto, do not apply if the consumer is not a resident of Kansas at the time of a consumer credit transaction and the parties have agreed that the law of the consumer's residence applies.
(4) With respect to consumer credit transactions entered into pursuant to open-end credit, this act shall apply if the consumer's communication or indication of intention to establish the agreement is received by the creditor conducting business in Kansas. If no communication or indication of intention is given by the consumer before the first transaction, this act applies if the creditor's communication notifying the consumer of the privilege of using open-end credit is provided to the consumer in Kansas.
(5) The part addressing limitations on creditors' remedies of the article on remedies and penalties applies to actions or other proceedings brought in this state to enforce rights arising from consumer credit transactions or extortionate extensions of credit, wherever made.
(6) For the purposes of K.S.A. 16a-1-101 et seq., and amendments thereto, the residence of a consumer is the address provided by the consumer as the consumer's residence in any written agreement signed by the consumer in connection with a consumer credit transaction. Until the consumer notifies the creditor of a new or different address, the address provided by the consumer shall be presumed to be unchanged.
(7) Except as provided in subsection (3), the following agreements by a buyer, lessee or debtor are invalid with respect to a consumer credit transaction to which K.S.A. 16a-1-101 et seq., and amendments thereto, apply:
(a) That the law of another state shall apply;
(b) that the consumer consents to the jurisdiction of another state; and
(c) that fixes venue.
History: L. 1973, ch. 85, § 9; L. 1977, ch. 70, § 1; L. 1981, ch. 93, § 4; L. 1993, ch. 200, § 3; L. 1999, ch. 107, § 7; L. 2024, ch. 6, § 35; January 1, 2025.
K.S.A. 16a-1-101 through 16a-6-414* do not apply to:
(1) Extensions of credit to government or governmental agencies or instrumentalities;
(2) the sale of insurance by an insurer if the insured is not obligated to pay installments of the premium and the insurance may terminate or be cancelled after nonpayment of an installment of the premium, except as otherwise provided in article 4 of chapter 40 of the Kansas Statutes Annotated, and amendments thereto;
(3) transactions under public utility or common carrier tariffs if a subdivision or agency of this state or of the United States regulates the charges for the services involved, the charges for delayed payment, and any discount allowed for early payment;
(4) pawnbrokers licensed and regulated pursuant to statutes of this state, except with respect to disclosure;**
(5) transactions covered by the Kansas insurance premium finance company act, K.S.A. 40-2601 et seq., and amendments thereto.
History: L. 1973, ch. 85, § 10; L. 2024, ch. 6, § 36; January 1, 2025.
As used in K.S.A. 16a-1-101 et seq., and amendments thereto:
(1) "Actuarial method" means the method of allocating payments made on a debt between the principal and the finance charge pursuant to which a payment is applied, assuming no late fees or other additional charges are then due, first to the accumulated finance charge and then to the unpaid principal balance. When a finance charge is calculated in accordance with the actuarial method, the contract rate is applied to the unpaid principal balance for the number of days the principal balance is unpaid. At the end of each computational period or fractional computational period, the unpaid principal balance is increased by the amount of the finance charge earned during that period and is decreased by the total payment, if any, made during the period after the deduction of any late fees or other additional charges due during the period.
(2) "Administrator" means the deputy commissioner of the consumer and mortgage lending division appointed by the bank commissioner pursuant to K.S.A. 75-3135, and amendments thereto.
(3) "Agent" means a person authorized through express or implied authority to act on behalf of a licensee or applicant.
(4) "Agreement" means the bargain of the parties in fact as found in their language or by implication from other circumstances including course of dealing or usage of trade or course of performance.
(5) "Amount financed" means the net amount of credit provided to the consumer or on the consumer's behalf. The amount financed shall be calculated as provided in rules and regulations adopted by the administrator pursuant to K.S.A. 16a-6-117, and amendments thereto.
(6) "Annual percentage rate" means the same and shall be interpreted in the same manner and be calculated using the same methodology as prescribed in 15 U.S.C. § 1606.
(7) "Applicant" means a person who applies to become licensed pursuant to K.S.A. 16a-2-302, and amendments thereto.
(8) "Assignment" means the act by which one person transfers to another person or causes to vest in that other person, any kind of property or valuable interests and includes any temporary or permanent transfer of servicing rights in the property or valuable interest.
(9) "Balloon payment" means any scheduled payment that is more than twice as large as the average of earlier scheduled payments.
(10) "Billing cycle" means the same and shall be interpreted in the same manner as prescribed in 12 C.F.R. 1026.2(a)(4).
(11) "Cash price" of goods, services or an interest in land means the price at which they are offered for sale by the seller to cash buyers in the ordinary course of business and may include:
(a) The cash price of accessories or services related to the sale, such as delivery, installation, alterations, modifications, and improvements; and
(b) taxes to the extent imposed on a cash sale of the goods, services or interest in land. The cash price stated by the seller to the buyer in a disclosure statement is presumed to be the cash price.
(12) "Closed-end credit" means the same and shall be interpreted in the same manner as prescribed in 12 C.F.R. 1026.2(a)(10).
(13) "Closing costs" with respect to a debt secured by an interest in land includes:
(a) The actual fees paid a public official or agency of the state or federal government, for filing, recording or releasing any instrument relating to the debt; and
(b) bona fide and reasonable expenses incurred by the lender in connection with the making, closing, disbursing, extending, readjusting or renewing the debt which are payable to third parties not related to the lender, except that reasonable fees for an appraisal made by the lender or related party are permissible.
(14) "Conspicuous" means a term or clause that is so written so a reasonable person against whom it is to operate ought to have noticed it. Whether a term or clause is conspicuous or not is for decision by the trier of fact.
(15) "Consumer" means the buyer, lessee or debtor to whom credit is offered or granted in a consumer credit transaction.
(16) "Consumer credit filer" means a person who is required to file a notice with the administrator pursuant to K.S.A. 16a-6-201 et seq., and amendments thereto.
(17) "Consumer credit insurance" means insurance, other than insurance on property, by which the satisfaction of debt in whole or in part is a benefit provided, but does not include insurance that:
(a) Is provided in relation to a consumer credit transaction in which a payment is scheduled more than 15 years after the extension of credit;
(b) is issued as an isolated transaction on the part of the insurer not related to an agreement or plan for insuring consumers of the creditor; or
(c) indemnifies the creditor against loss due to the consumer's default.
(18) "Consumer credit sale" means:
(a) Except as provided in paragraph (b), a sale of goods or services, in which:
(i) Credit is granted either by a seller who regularly engages as a seller in credit transactions of the same kind or pursuant to a credit card other than a lender credit card;
(ii) the buyer is a person other than an organization;
(iii) the goods or services are purchased primarily for a personal, family or household purpose;
(iv) either the debt is by written agreement payable in more than four installments or a finance charge is made; and
(v) with respect to a sale of goods or services, the amount financed does not exceed the threshold amount.
(b) A "consumer credit sale" does not include:
(i) A sale in which the seller allows the buyer to purchase goods or services pursuant to a lender credit card; or
(ii) a sale of an interest in land.
(19) "Consumer credit transaction" means a consumer credit sale, consumer lease, or consumer loan or a modification thereof including a refinancing, consolidation or deferral.
(20) "Consumer lease" means a lease of goods:
(a) That a lessor regularly engaged in the business of leasing makes to a person, other than an organization, who takes under the lease primarily for a personal, family or household purpose;
(b) in which the amount payable under the lease does not exceed the threshold amount;
(c) that is for a term exceeding four months; and
(d) that is not made pursuant to a lender credit card.
(21) "Consumer loan":
(a) Except as provided in paragraph (b), a "consumer loan" is a loan made by a person regularly engaged in the business of making loans in which:
(i) The debtor is a person other than an organization;
(ii) the debt is incurred primarily for a personal, family or household purpose;
(iii) either the debt is payable by written agreement in more than four installments or a finance charge is made; and
(iv) the amount financed does not exceed the threshold amount.
(b) Unless the loan is made subject to the uniform consumer credit code by written agreement, a "consumer loan" does not include:
(i) A loan secured by a mortgage; or
(ii) a loan made by a qualified plan, as defined in section 401 of the internal revenue code, to an individual participant in such plan or to a member of the family of such individual participant.
(22) "Credit" means the right granted by a creditor to a debtor to defer payment of debt or to incur debt and defer its payment.
(23) "Credit card" means any card or other single credit device that may be used from time to time to obtain credit. Since this involves the possibility of repeated use of a single device, checks and similar instruments that can be used only once to obtain a single credit extension are not credit cards.
(24) "Creditor" means a person who regularly engages, directly or indirectly in extending credit in a consumer credit transaction or, except as otherwise provided, an assignee of a creditor's right to payment. The term assignee does not in itself impose on an assignee any obligation of its assignor. In the case of credit extended pursuant to a credit card, the creditor is the card issuer and not another person honoring the credit card.
(25) "Director" means a member of a licensee's or applicant's board of directors.
(26) "Earnings" means compensation payable to an individual for personal services rendered or to be rendered by such individual, whether denominated as wages, salary, commission, bonus or otherwise and includes periodic payments pursuant to a pension, retirement or disability program.
(27) "Finance charge" means all charges payable directly or indirectly by the consumer and imposed directly or indirectly by the creditor as an incident to or as a condition of the extension of credit. The finance charge shall be calculated as provided in rules and regulations adopted by the administrator pursuant to K.S.A. 16a-6-104, and amendments thereto.
(28) "Goods" includes goods not in existence at the time the transaction is entered into and merchandise certificates, but excludes money, chattel paper, documents of title, and instruments.
(29) "Installment" means a periodic payment required or permitted by agreement in connection with a consumer credit transaction.
(30) "Lender" includes an assignee of the lender's right to payment but use of the term does not in itself impose on an assignee any obligation of the lender with respect to events occurring before the assignment.
(31) "Lender credit card" means a credit card issued by a supervised lender.
(32) "License" means the authorization allowing a person to make supervised loans pursuant to the provisions on authority to make supervised loans.
(33) "Licensee" means a person that is licensed by the administrator to engage in supervised loan activity.
(34) "Licensing" includes the administrator's process respecting the grant, denial, revocation, suspension, annulment, withdrawal or amendment of a license.
(35) (a) "Loan": Except as provided in paragraph (b), a "loan" includes:
(i) The creation of debt by the lender's payment of or agreement to pay money to the debtor or to a third party for the account of the debtor;
(ii) the creation of debt either pursuant to a lender credit card or by a cash advance to a debtor pursuant to a credit card other than a lender credit card;
(iii) the creation of debt by a credit to an account with the lender upon which the debtor is entitled to draw immediately; and
(iv) the forbearance of debt arising from a loan.
(b) A "loan" does not include the payment or agreement to pay money to a third party for the account of a debtor if the debt of the debtor arises from a sale or lease and results from use of either a credit card issued by a person primarily in the business of selling or leasing goods or services or any other credit card which may be used for the purchase of goods or services and which is not a lender credit card.
(36) "Member" means, for the following business organizations:
(a) A co-partnership, a limited or general partner;
(b) an association that is a corporation, an owner;
(c) an association that is a member-managed limited liability company, the named managing partner; and
(d) an association that is a limited liability company managed by elected or appointed managers, all elected or appointed managers.
(37) "Merchandise certificate" means a writing or electronic instrument issued by a seller not redeemable in cash and usable in its face amount in lieu of cash in exchange for goods or services.
(38) "Nationwide mortgage licensing system and registry" means a mortgage licensing system developed and maintained by the conference of state bank supervisors and the American association of residential mortgage regulators for the licensing and registration of licensed mortgage loan originators and other financial service providers.
(39) "Officer" means a person who participates or has the authority to participate, other than in the capacity of a director, in major policymaking functions of the licensee or applicant, whether or not the person has an official title, including the chief executive officer, chief financial officer, chief operations officer, chief legal officer, chief credit officer, chief compliance officer and every vice president.
(40) "Official fees" means:
(a) Taxes and fees prescribed by law that actually are or will be paid to public officials for determining the existence of or for perfecting, releasing or satisfying a security interest related to a consumer credit transaction; or
(b) premiums payable for insurance in lieu of perfecting a security interest otherwise required by the creditor in connection with the sale, lease or loan, if the premium does not exceed the fees and charges described in paragraph (a) which would otherwise be payable.
(41) "Open-end credit" means an arrangement pursuant to which:
(a) A creditor may permit a consumer, from time to time, to purchase goods or services on credit from the creditor or pursuant to a credit card or to obtain loans from the creditor or pursuant to a credit card;
(b) the unpaid balance of amounts financed and the finance and other appropriate charges are debited to an account;
(c) the finance charge, if made, is computed on the outstanding unpaid balances of the consumer's account from time to time; and
(d) the consumer has the privilege of paying the balances in installments.
(42) "Organization" means a corporation, limited liability company, government or governmental subdivision or agency, trust, estate, partnership, cooperative, association or any other legally recognized business entity.
(43) "Person" includes a natural person or an individual, and an organization.
(44) (a) "Person related to" with respect to an individual means:
(i) The spouse of the individual;
(ii) a brother, brother-in-law, sister, sister-in-law of the individual;
(iii) an ancestor or lineal descendant of the individual or the individual's spouse; or
(iv) any other relative, by blood, adoption or marriage, of the individual or such individual's spouse.
(b) "Person related to" with respect to an organization means:
(i) A person directly or indirectly controlling, controlled by or under common control with the organization;
(ii) an officer or director of the organization or a person performing similar functions with respect to the organization or to a person related to the organization;
(iii) the spouse of a person related to the organization; or
(iv) a relative by blood, adoption or marriage of a person related to the organization.
(45) "Prepaid finance charge" means any finance charge paid separately in cash or by check before or at consummation of a transaction or withheld from the proceeds of the credit at any time.
(46) "Principal" means the total of the amount financed and the prepaid finance charges, except that prepaid finance charges are not added to the amount financed to the extent such prepaid finance charges are paid separately in cash or by check by the consumer.
(47) "Regularly engaged" means a person that extends credit directly or through assignment more than 25 times in any state during the preceding calendar year.
(48) "Sale of goods" includes any agreement in the form of a bailment or lease of goods if the bailee or lessee agrees to pay as compensation for use a sum substantially equivalent to or in excess of the aggregate value of the goods involved and it is agreed that the bailee or lessee will become, or for no other or a nominal consideration has the option to become, the owner of the goods upon full compliance with such bailee's or lessee's obligations under the agreements.
(49) "Sale of services" means furnishing or agreeing to furnish services and includes making arrangements to have services furnished by another.
(50) "Seller" includes an assignee of the seller's right to payment but use of the term does not in itself impose on an assignee any obligation of the seller with respect to events occurring before the assignment.
(51) "Services" includes:
(a) Work, labor, and other personal services;
(b) privileges with respect to transportation, hotel and restaurant accommodations, education, entertainment, recreation, physical culture, hospital accommodations, funerals, cemetery accommodations, and the like; and
(c) insurance.
(52) "Supervised financial organization" means a person, other than an insurance company or other organization primarily engaged in an insurance business:
(a) Organized, chartered or holding an authorization certificate under the laws of any state or of the United States which authorize the person to make loans and to receive deposits, including a savings, share, certificate or deposit account; and
(b) subject to supervision by an official or agency of such state or of the United States.
(53) "Supervised lender" means a person authorized to make or take assignments of supervised loans, either under a license issued by the administrator or as a supervised financial organization.
(54) "Supervised loan" means a consumer loan, including a loan made pursuant to open-end credit, with respect to which the annual percentage rate exceeds 12%.
(55) "Threshold amount" means an amount equal to at least $69,500 as of July 1, 2024, and adjusted effective January 1 of each subsequent year by any annual percentage increase in the consumer price index for urban wage earners and clerical workers that was in effect on June 1 of the preceding year. Any increase or decrease in the threshold amount shall be rounded up or down to the nearest increment of $100. If the consumer price index for urban wage earners and clerical workers in effect on June 1 does not increase from the consumer price index for urban wage earners and clerical workers in effect on June 1 of the preceding year, the threshold amount effective the following January 1 through December 31 shall not change from the preceding year.
(56) "Written agreement" means an agreement such as a promissory note, contract or lease that is evidence of or relates to the indebtedness. A letter that merely confirms an oral agreement does not constitute a written agreement for purposes of this subsection unless signed by the person against whom enforcement is sought.
(57) "Written administrative interpretation" means any written official interpretation by the administrator regarding the uniform consumer credit code and rules and regulations pertaining thereto.
History: L. 1973, ch. 85, § 11; L. 1980, ch. 75, § 4; L. 1980, ch. 76, § 5; L. 1981, ch. 93, § 5; L. 1982, ch. 89, § 2; L. 1984, ch. 83, § 1; L. 1988, ch. 85, § 2; L. 1992, ch. 80, § 1; L. 1993, ch. 200, § 4; L. 1993, ch. 200, § 5; L. 1996, ch. 166, § 2; L. 1998, ch. 106, § 1; L. 1999, ch. 107, § 8; L. 1999, ch. 166, § 8; L. 2000, ch. 27, § 1; L. 2006, ch. 97, § 1; L. 2024, ch. 6, § 37; January 1, 2025.
History: L. 1973, ch. 85, § 12; Repealed, L. 1981, ch. 93, § 19; July 1.
History: L. 1973, ch. 85, § 13; L. 2009, ch. 29, § 15; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
History: L. 1973, ch. 85, § 14; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
History: L. 1973, ch. 85, § 15; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
(1) The provisions of this section shall apply to all consumer loans and all consumer credit sales.
(2) The finance charge on a consumer loan or consumer credit sale shall be computed in accordance with the actuarial method using either the 365/365 method or, if the consumer agrees in writing, the 360/360 method:
(a) The 365/365 method means a method of calculating the finance charge whereby the contract rate is divided by 365 and the resulting daily rate is multiplied by the outstanding principal amount and the actual number of days in the computational period.
(b) The 360/360 method means a method of calculating the finance charge whereby the contract rate is divided by 360 and the resulting daily rate is multiplied by the outstanding principal amount and the number of assumed days in the computational period. For the purposes of this subsection, a creditor may assume that a month has 30 days, regardless of the actual number of days in the month.
(c) If the documentation evidencing a consumer credit contract is silent regarding whether the 365/365 method or the 360/360 method applies, then the 365/365 method shall apply.
(3) The finance charge on a consumer loan or consumer credit sale may not be computed in accordance with the 365/360 method, whereby the contract rate is divided by 360 and the resulting daily rate is multiplied by the outstanding principal amount and the actual number of days in the computational period.
(4) Creditors may ignore the effect of a leap year in computing the finance charge.
(5) (a) Except for any portion of a loan made pursuant to a lender credit card which does not represent a cash advance, interest or other periodic finance charges on a consumer loan may accrue only on that portion of the principal which has been disbursed to or for the benefit of the consumer.
(b) On a consumer credit sale, interest or other periodic finance charges may accrue only on that portion of the principal which relates to goods or services that have been shipped, delivered, furnished or otherwise made available to or for the benefit of the consumer or have been disbursed to or for the benefit of the consumer.
History: L. 1993, ch. 200, § 1; L. 1999, ch. 107, § 9; L. 2005, ch. 144, § 8; L. 2024, ch. 6, § 38; January 1, 2025.
(1) A creditor shall credit a payment to the consumer's account on the date of receipt, except when a delay in crediting does not result in a finance charge or other charge.
(2) Notwithstanding subsection (1), if a creditor specifies, in a writing delivered to the consumer, reasonable requirements for the consumer to follow in making payments, but accepts a payment that does not conform to those requirements, then the creditor shall credit the payment within five days after receipt.
History: L. 1999, ch. 107, § 4; L. 2024, ch. 6, § 39; January 1, 2025.
(1) This section applies only to a closed-end consumer credit sale.
(2) A seller may charge a finance charge at any rate agreed to by the parties, subject, however, to the limitations on prepaid finance charges set forth in subsection (3).
(3) A seller may charge a prepaid finance charge:
(a) For any consumer credit sale, an amount not to exceed the lesser of 2% of the amount financed or $300.
(b) A prepaid finance charge permitted under this subsection is in addition to finance charges permitted under subsection (2). A prepaid finance charge permitted under this subsection is fully earned when paid and is nonrefundable, unless the parties agree otherwise in writing.
History: L. 1973, ch. 85, § 16; L. 1980, ch. 77, § 1; L. 1981, ch. 94, § 1; L. 1982, ch. 93, § 1; L. 1983, ch. 79, § 1; L. 1985, ch. 82, § 1; L. 1988, ch. 85, § 3; L. 1988, ch. 86, § 1; L. 1988, ch. 87, § 1; L. 1993, ch. 200, § 6; L. 1995, ch. 54, § 1; L. 1997, ch. 90, § 1; L. 1998, ch. 107, § 1; L. 1999, ch. 107, § 10; L. 2000, ch. 28, § 1; L. 2024, ch. 6, § 40; January 1, 2025.
(1) This section shall apply only to open-end consumer credit sales.
(2) A seller may charge a finance charge at any rate agreed to by the parties.
(3) A charge may be made in each billing cycle which is a percentage of an amount no greater than:
(a) The average daily balance of the account, which is the sum of the actual amounts outstanding each day during the billing cycle divided by the number of days in the cycle; or
(b) the unpaid balance of the account on the last day of the billing cycle.
(4) If the billing cycle is monthly, the charges may not exceed 1/12 of the annual rate agreed to by the consumer. If the billing cycle is not monthly, the maximum charge is that percentage which bears the same relation to the applicable monthly percentage as the number of days in the billing cycle bears to 30. For purposes of this subsection, a variation of not more than four days from month to month is "the last day of the billing cycle."
(5) For any period in which a finance charge is due, the parties may agree in writing on a minimum amount.
History: L. 1973, ch. 85, § 17; L. 1980, ch. 77, § 2; L. 1981, ch. 94, § 2; L. 1982, ch. 93, § 2; L. 1983, ch. 79, § 2; L. 1985, ch. 82, § 2; L. 1988, ch. 85, § 4; L. 1988, ch. 86, § 2; L. 1997, ch. 90, § 2; L. 1999, ch. 107, § 11; L. 2024, ch. 6, § 41; January 1, 2025.
(1) Unless a person is exempt from licensing pursuant to K.S.A. 2025 Supp. 16a-2-311, and amendments thereto, such person shall not engage in the business of:
(a) Making supervised loans; or
(b) taking assignments of and directly or indirectly, including through the use of supervised loans servicing contracts or otherwise, and either:
(i) Undertaking collection of payments from debtors arising from supervised loans; or
(ii) enforcing rights against debtors arising from supervised loans.
(2) If any person is engaged in the business of subsection (1)(b), such person shall promptly apply for a license and may for three months collect and enforce without such license, provided such person's application has not been denied.
History: L. 1973, ch. 85, § 18; L. 1980, ch. 76, § 6; L. 1985, ch. 83, § 1; L. 1988, ch. 85, § 5; L. 2009, ch. 29, § 16; L. 2024, ch. 6, § 42; January 1, 2025.
(1) (a) The administrator shall receive and act on all applications for licenses to make supervised loans. Any person required to be licensed pursuant to this act shall submit an application in the manner prescribed by the administrator that shall contain the information the administrator may require by rule and regulation to make an evaluation of the financial responsibility, character and fitness of the applicant.
(b) Submitted with each application shall be a nonrefundable application fee pursuant to K.S.A. 16a-6-104(5), and amendments thereto. A license shall become effective as of the date specified in writing by the administrator. The license year shall be the calendar year and the license shall expire on December 31 of the year unless the license is renewed pursuant to subsection (1)(d). Each license shall be nontransferable and nonassignable, and shall remain in force until it has expired, is surrendered, suspended or revoked.
(c) The administrator shall consider an application for a license abandoned if the applicant fails to complete the application within 60 days after the administrator provides the applicant with written notice of the incomplete application. An applicant whose application is abandoned under this section may reapply to obtain a license and shall pay the fee set forth in subsection (1) upon such application. If an application is considered abandoned pursuant to K.S.A. 16a-2-302, and amendments thereto, an applicant may make a written request for a hearing. The administrator shall conduct a hearing in accordance with the Kansas administrative procedure act.
(d) A license shall be renewed annually for the subsequent year by filing with the administrator, on or before December 1 of the current year, a renewal application accompanied with the fee prescribed under subsection (1) for each license. Such application shall be filed in the form and manner prescribed by the administrator and shall contain such information that the administrator requires to determine the existence of any material changes from the information contained in the applicant's original license application or prior renewal application. A late fee may be assessed if a renewal application is filed after December 1.
(e) Each renewal application shall be accompanied by a nonrefundable fee that shall be established by rules and regulations pursuant to K.S.A. 16a-6-104, and amendments thereto.
(f) There is hereby established a reinstatement period. Licensees may submit a complete renewal application through the last day of February each year. If approved, there will be no lapse in license coverage. An application for renewal or reinstatement received after the last day of February shall be treated as an original application and shall be subject to all reporting and fees associated therewith.
(2) No license shall be issued unless the administrator, upon investigation, finds that the financial responsibility, character and fitness of the applicant, and of the members thereof if the applicant is a copartnership or association and of the officers and directors thereof, if the applicant is a corporation, are such as to warrant belief that the applicant or licensee shall operate honestly and fairly within the purposes of this act. An applicant meets the minimum standard of financial responsibility for engaging in the business of making supervised loans, K.S.A. 16a-2-301(1), and amendments thereto, only if:
(a) The applicant has filed with the administrator a proper surety bond of at least $100,000 which has been approved by the administrator. The bond must provide within its terms that the bond shall not expire for two years after the date of the surrender, revocation or expiration of the subject license, whichever shall first occur. The required surety bond may not be canceled by the licensee without providing the administrator at least 30 days' prior written notice, provided that such cancellation shall not affect the surety's liability for violations of the uniform consumer credit code occurring prior to the effective date of cancellation and principal and surety shall be and remain liable for a period of two years from the date of any action or inaction of the principal that gives rise to a claim under the bond; and
(b) the applicant provides evidence in a form and manner prescribed by the administrator that establishes the applicant will maintain a satisfactory minimum net worth, as determined by the administrator, to engage in credit transactions of the nature proposed by the applicant. Such net worth requirements shall be established by the administrator pursuant to rule and regulation and shall not exceed $500,000 for each applicant or licensee.
(3) (a) A licensee shall provide written notice to the administrator within 10 business days of the occurrence of any of the following events:
(1) The closing or relocation of any place of business;
(2) a change in the licensee's name or legal entity status; or
(3) the addition or loss of any owner, officer, member or director.
(b) The administrator may request additional information concerning any written notice received pursuant to subsection (a)* and charge a reasonable fee for any action required by the administrator as a result of such notice and additional information.
(4) A licensee may conduct the business of making loans for personal, family or household purposes only at or from any place of business for which the licensee holds a license and not under any other name than that in the license. Loans made pursuant to a lender credit card do not violate this subsection.
(5) All solicitations and published advertisements concerning consumer credit transactions directed at Kansas residents, including those on the internet or by other electronic means, shall contain the name and license number or unique identifier of the licensee on record with the administrator. Each licensee shall maintain a record of all solicitations or advertisements for a period of 36 months. As used in this subsection, "advertising" excludes business cards or promotional items, including, but not limited to, pens, pencils, hats and other such novelty items.
(6) The administrator shall remit all moneys received under K.S.A. 16a-1-101 et seq., and amendments thereto, to the state treasurer in accordance with the provisions of K.S.A. 75-4215, and amendments thereto. Upon receipt of each such remittance, the state treasurer shall deposit the entire amount in the state treasury. Of each such deposit, 10% shall be credited to the state general fund and the balance shall be credited to the bank commissioner fee fund. All expenditures from such fund shall be made in accordance with appropriation acts upon warrants of the director of accounts and reports issued pursuant to vouchers approved by the administrator or the administrator's designee. Late fees paid under this section may be designated by the administrator for consumer education.
History: L. 1973, ch. 85, § 19; L. 1976, ch. 98, § 1; L. 1981, ch. 95, § 1; L. 1999, ch. 107, § 12; L. 1999, ch. 166, § 9; L. 2000, ch. 27, § 2; L. 2001, ch. 5, § 57; L. 2005, ch. 144, § 9; L. 2009, ch. 29, § 17; L. 2011, ch. 53, § 5; L. 2024, ch. 6, § 43; January 1, 2025.
(1) The administrator may deny an application or renewal or revoke or suspend a supervised loan license if the administrator finds, after notice and opportunity for a hearing conducted in accordance with the provisions of the Kansas administrative procedure act, that:
(a) The applicant or licensee has repeatedly or willfully violated the provisions of K.S.A. 16a-1-101 et seq., and amendments thereto, or any rules and regulations, order or administrative interpretation lawfully made pursuant to this act;
(b) facts or conditions exist that would clearly have justified the administrator in refusing to grant a license had such facts or conditions been known to exist at the time the application for the license was made;
(c) the applicant or licensee has filed with the administrator any document or statement falsely representing or omitting a material fact;
(d) the applicant, licensee, members of a copartnership or association or officers and directors of a corporation have been convicted of a felony crime or any crime involving fraud, dishonesty or deceit or the applicant or licensee knowingly or repeatedly contracts with or employs persons to directly engage in lending activities who have been convicted of a felony crime or any crime involving fraud, dishonesty or deceit;
(e) the applicant or licensee has engaged in deceptive business practices;
(f) the applicant or licensee has been the subject of any disciplinary action by this or any other state or federal agency;
(g) a final judgment has been entered against the applicant or licensee in a civil action and the administrator finds the conduct on which the judgment is based indicates that it would be contrary to the public interest to permit such person to be licensed;
(h) the applicant or licensee has failed to keep and maintain sufficient records to permit an audit satisfactorily disclosing to the administrator the applicant or licensee's compliance with the provisions of this act; or
(i) the applicant or licensee has failed to file and maintain the surety bond or net worth required in K.S.A. 16a-2-302, and amendments thereto.
(2) Upon written request, the applicant or licensee is entitled to a hearing in accordance with the Kansas administrative procedure act, K.S.A. 77-501 et seq., and amendments thereto, if the administrator denies an application, fails to issue a new license within 60 days of receipt of a complete application, revokes a license, suspends a license or fails to issue a renewal within 30 days after receipt of a complete application.
(3) Any person holding a license to make supervised loans may surrender the license by notifying the administrator in writing of its surrender, but this surrender shall not affect such person's liability for acts previously committed.
(4) No revocation, suspension or relinquishment of a license shall impair or affect the obligation of any preexisting lawful contract between the licensee and any debtor.
(5) None of the following actions shall deprive the administrator of any jurisdiction or right to institute or proceed with any disciplinary proceeding against such licensee, to render a decision suspending, revoking or refusing to renew such license or to establish and make a record of the facts of any violation of law for any lawful purpose:
(a) The imposition of an administrative penalty under this section;
(b) the lapse or suspension of any license issued under this act by operation of law;
(c) the licensee's failure to renew any license issued under this act; or
(d) the licensee's voluntary surrender of any license issued under this act.
(6) The administrator may reinstate a license, terminate a suspension or grant a new license to a person whose license has been revoked or suspended if no fact or condition then exists which clearly would have justified the administrator in refusing to grant a license.
History: L. 1973, ch. 85, § 20; L. 1988, ch. 356, § 47; L. 1999, ch. 107, § 13; L. 2005, ch. 144, § 10; L. 2009, ch. 29, § 18; L. 2024, ch. 6, § 44; January 1, 2025.
History: L. 2009, ch. 29, § 2; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
(1) Every licensee and any assignee or servicer of a consumer credit transaction and every consumer credit filer shall maintain records in conformity with generally accepted accounting principles and practices in a manner that will enable the administrator and, in the case of a supervised financial organization its supervisory official or agency, to determine whether the licensee, assignee, servicer or consumer credit filer is complying with the provisions of K.S.A. 16a-1-101 et seq., and amendments thereto. The record keeping system of a licensee, assignee, servicer or consumer credit filer shall be sufficient if the licensee, assignee, servicer or any consumer credit filer makes the required information reasonably available. The records need not be kept in the place of business where supervised loans are made, if the administrator or supervisory official or agency is given free access to the records wherever located. Every licensee and every consumer credit filer shall provide the administrator with the name, address, telephone number, email address, contact person and any other reasonable information regarding the location and availability of current records of a consumer credit transaction. The records pertaining to any loan shall be kept for the minimum time frames established by the administrator pursuant to rules and regulations.
(2) Every licensee and any assignee or servicer of a consumer credit transaction, and every consumer credit filer shall establish, maintain and enforce written policies and procedures regarding security of records which are reasonably designed to prevent the misuse of a consumer's personal or financial information.
(3) Before ceasing to conduct or discontinuing business, a licensee, assignee, servicer or consumer credit filer shall arrange for and be responsible for the preservation of the books and records required to be maintained and preserved under this act and applicable rules and regulations for the remainder of each period specified.
(4) All books, records and any other documents required to be retained may be maintained in a photographic, reproduced or electronic format. If the records are photographed, reproduced or retained in an electronic format, the licensee, assignee or consumer credit filer shall meet the following criteria:
(a) Arrange the records to permit immediate location of any particular record;
(b) with respect to electronic images and records stored on computer storage medium, maintain procedures for maintenance and preservation of, and access to, records in order to reasonably safeguard these records from loss, alteration or destruction; and
(c) all books, records and any other documents shall be made available for examination and inspection by the administrator or the administrator's designee. All records shall be delivered to the administrator within three business days of the date such documents are requested.
(5) In lieu of retention of the original records, any such photograph or reproduction shall have the same force and effect as the original thereof and be admitted in evidence equally with the original.
(6) On or before April 15 of each year every licensee shall file with the administrator and, in the case of a supervised financial organization with its supervisory official or agency, a composite annual report in the form prescribed by the administrator relating to all loans made by such licensee. The administrator shall consult with comparable officials in other states for the purpose of making the kinds of information required in annual reports uniform among the states. Information contained in annual reports shall be confidential and may be published only in composite form.
(7) No person required to be a licensee or a consumer credit filer or an assignee or servicer of a consumer credit transaction under this act shall alter, destroy, shred, mutilate, conceal, cover up or falsify any record with the intent to impede, obstruct or influence any investigation by the administrator or the administrator's designee or any proceeding brought by or before the administrator.
History: L. 1973, ch. 85, § 21; L. 1980, ch. 76, § 7; L. 1998, ch. 106, § 2; L. 2005, ch. 144, § 11; L. 2009, ch. 29, § 19; L. 2024, ch. 6, § 45; January 1, 2025.
History: L. 1973, ch. 85, § 22; L. 1980, ch. 76, § 8; Repealed, L. 1999, ch. 107, § 34; July 1.
History: L. 1973, ch. 85, § 23; Repealed, L. 1999, ch. 107, § 34; July 1.
History: L. 1973, ch. 85, § 24; L. 1999, ch. 107, § 14; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
Supervised loans not made pursuant to open-end credit or lender credit cards issued by a supervised lender and in which the amount financed is $1,000 or less and the principal of which is payable in more than a single payment must be scheduled to be payable in substantially equal installments at equal periodic intervals except to the extent that the schedule of payments is adjusted to the seasonal or irregular income of the debtor and over a period of not more than 25 months.
History: L. 1973, ch. 85, § 25; L. 1977, ch. 71, § 1; L. 2024, ch. 6, § 46; January 1, 2025.
A licensee may conduct the business of making loans under K.S.A. 16a-1-101 et seq., and amendments thereto, within any office, room or place of business in which any other business is solicited or engaged in or in association or conjunction therewith, unless the administrator finds that the other business is of such nature that such conduct tends to conceal a violation of this act or of the rules and regulations made thereunder and shall order such licensee in writing to desist from such conduct.
History: L. 1973, ch. 85, § 26; L. 1998, ch. 106, § 3; L. 2024, ch. 6, § 47; January 1, 2025.
No person required to be licensed or required to be a consumer credit filer under this act shall directly or indirectly:
(a) Delay closing of a loan for the purpose of increasing interest, costs, fees or charges payable by the borrower;
(b) misrepresent the material facts or make false promises intended to influence, persuade or induce a consumer to enter into a loan;
(c) misrepresent to or conceal from an applicant for a loan, a guarantor or a lender, material facts, terms or conditions of a transaction to which the person required to be licensed or required to be a consumer credit filer is a party;
(d) engage in any transaction, practice or business conduct that is not in good faith or that operates a fraud upon any person in connection with any consumer credit transaction;
(e) transfer, assign or attempt to transfer or assign, a license to any other person or assist or aid and abet any person who does not hold a valid license under this act in engaging in conduct requiring a license;
(f) solicit or enter into a contract with a borrower that provides in substance that the person required to be licensed or required to be a consumer credit filer may earn a fee or commission through best efforts to obtain a loan even though no loan is actually obtained for the borrower; or
(g) fail to comply with the uniform consumer credit code, or rules and regulations promulgated thereunder or fail to comply with any other state or federal law, including the rules and regulations promulgated thereunder, applicable to any business authorized or conducted under the uniform consumer credit code.
History: L. 2009, ch. 29, § 3; L. 2024, ch. 6, § 48; January 1, 2025.
(1) The following shall be exempt from the supervised loan licensing requirements of this act:
(a) A supervised financial organization;
(b) the federal deposit insurance corporation acting in its corporate capacity or as receiver; or
(c) an attorney who is forwarded contracts for collection.
(2) This section shall be a part of and supplemental to the uniform consumer credit code.
History: L. 2024, ch. 6, § 15; January 1, 2025.
(1) For any consumer loan incurred pursuant to open-end credit, including, without limitation, a loan pursuant to a lender credit card, a lender may charge a finance charge at any rate agreed to by the parties, subject, however, to the limitations on prepaid finance charges set forth in subsection (4).
(2) For any consumer loan incurred pursuant to closed-end credit, a lender may charge a periodic finance charge, calculated accordingly to the actuarial method, not to exceed 36% per annum.
(3) This section does not limit or restrict the manner of calculating the finance charge, whether by way of add-on, discount or otherwise, so long as the rate and the amount of the finance charge does not exceed that permitted by this section.
(4) Prepaid finance charges on consumer loans are limited to an amount not to exceed the lesser of 2% of the amount financed or $300.
Prepaid finance charges permitted under this subsection are in addition to finance charges permitted under subsection (1) and (2), as applicable. Prepaid finance charges permitted under this subsection are fully earned when paid and are non-refundable, unless the parties agree otherwise in writing.
(5) If, within 12 months after the date of the original loan, a lender or a person related to the lender refinances a loan with respect to which a prepaid finance charge was payable to the same lender pursuant to subsection (4), then the following apply:
(a) If a prepaid finance charge with respect to the original loan was payable to the lender pursuant to subsection (4), then the aggregate amount of prepaid finance charges payable to the lender or any person related to the lender with respect to the new loan may not exceed the lesser of 2% of the additional amount financed or $300.
(b) For purposes of this subsection, "additional amount financed" means the difference between:
(i) The amount financed for the new loan, less the amount of all costs incurred in connection with the new loan which are not included in the prepaid finance charges for the new loan; and
(ii) the unpaid principal balance of the original loan.
(6) For any period in which a finance charge is due on a consumer loan pursuant to open-end credit, the parties may agree on a minimum amount.
(7) This section does not apply to a payday loan governed by K.S.A. 16a-2-404, and amendments thereto.
History: L. 1973, ch. 85, § 27; L. 1974, ch. 91, § 1; L. 1975, ch. 126, § 1; L. 1980, ch. 76, § 9; L. 1980, ch. 77, § 3; L. 1981, ch. 94, § 3; L. 1982, ch. 94, § 1; L. 1983, ch. 79, § 3; L. 1985, ch. 82, § 3; L. 1986, ch. 90, § 1; L. 1988, ch. 85, § 6; L. 1988, ch. 86, § 3; L. 1988, ch. 87, § 2; L. 1993, ch. 200, § 7; L. 1995, ch. 54, § 2; L. 1999, ch. 107, § 15; L. 2000, ch. 27, § 3; L. 2000, ch. 159, § 1; L. 2024, ch. 6, § 49; January 1, 2025.
History: L. 1975, ch. 126, § 2; L. 1993, ch. 25, § 1; L. 1996, ch. 166, § 3; Repealed, L. 1999, ch. 107, § 34; July 1.
History: L. 1973, ch. 85, § 27; L. 1974, ch. 91, § 1; L. 1975, ch. 126, § 1; L. 1980, ch. 76, § 9; L. 1980, ch. 77, § 3; L. 1981, ch. 94, § 3; L. 1982, ch. 93, § 3; Repealed, L. 1983, ch. 79, § 5; July 1.
(1) This section applies only to consumer loans pursuant to open-end credit.
(2) A charge may be made in each billing cycle which is a percentage of an amount no greater than:
(a) The average daily balance of the account, which is the sum of the actual amounts outstanding each day during the billing cycle divided by the number of days in the cycle; or
(b) the unpaid balance of the account on the last day of the billing cycle.
(3) If the billing cycle is monthly, the charge may not exceed 1/12 of the annual rate agreed to by the consumer. If the billing cycle is not monthly, the maximum charge is that percentage which bears the same relation to the applicable monthly percentage as the number of days in the billing cycle bears to 30. For the purposes of this section, a variation of not more than four days from month to month is "the last day of the billing cycle."
History: L. 1973, ch. 85, § 28; L. 1999, ch. 107, § 16; L. 2024, ch. 6, § 50; January 1, 2025.
No person or retailer doing business in any sales, service or lease transaction with a customer may impose a surcharge on a customer who elects to use a credit card as payment unless such person or retailer discloses the amount of such a surcharge through a clear and conspicuous notice to the customer at the point of entry or the point of sale and in advance of such transaction.
History: L. 1986, ch. 90, § 2; L. 1999, ch. 107, § 17; L. 2010, ch. 64, § 1; L. 2024, ch. 6, § 51; January 1, 2025.
(1) On consumer loan transactions in which cash is advanced:
(a) With a short term,
(b) a single payment repayment is anticipated, and
(c) such cash advance is equal to or less than $500, a licensed or supervised lender may charge an amount not to exceed 15% of the amount of the cash advance.
(2) The minimum term of any loan under this section shall be 7 days and the maximum term of any loan made under this section shall be 30 days.
(3) A lender and related interest shall not have more than two loans made under this section outstanding to the same borrower at any one time and shall not make more than three loans to any one borrower within a 30 calendar day period. Each lender shall maintain a journal of loan transactions for each borrower which shall include at least the following information:
(a) Name, address and telephone number of each borrower; and
(b) date made and due date of each loan.
(4) Each loan agreement made under this section shall contain the following notice in at least 10 point bold face type: NOTICE TO BORROWER: KANSAS LAW PROHIBITS THIS LENDER AND THEIR RELATED INTEREST FROM HAVING MORE THAN TWO LOANS OUTSTANDING TO YOU AT ANY ONE TIME. A LENDER CANNOT DIVIDE THE AMOUNT YOU WANT TO BORROW INTO MULTIPLE LOANS IN ORDER TO INCREASE THE FEES YOU PAY.
Prior to consummation of the loan transaction, the lender must:
(a) Provide the notice set forth in this subsection in both English and Spanish; and
(b) obtain the borrower's signature or initials next to the English version of the notice or, if the borrower advises the lender that the borrower is more proficient in Spanish than in English, then next to the Spanish version of the notice.
(5) The contract rate of any loan made under this section shall not be more than 3% per month of the loan proceeds after the maturity date. No insurance charges or any other charges of any nature whatsoever shall be permitted, except as stated in subsection (7), including any charges for cashing the loan proceeds if they are given in check form.
(6) Any loan made under this section shall not be repaid by proceeds of another loan made under this section by the same lender or related interest. The proceeds from any loan made under this section shall not be applied to any other loan from the same lender or related interest.
(7) A consumer who is unable to repay a payday loan as contemplated under this section when due may elect once every 12 months to repay the payday loan by means of an extended payment plan. The 12-month period shall be measured from the date that the consumer pays in full an extended payment plan with the lender until the date that the consumer enters another extended payment plan with the lender.
(a) To request an extended payment plan, the consumer shall request the plan before close of business on the last business day before the due date of the outstanding payday loan and sign an amendment to the original agreement which memorializes the plan terms.
(b) The extended payment plan terms shall allow the consumer to repay the outstanding payday loan including any fee due in at least four substantially equal installments. Each plan installment shall be due on or after a date on which the consumer receives regular income, or, if the consumer has no regular income, due dates shall be a minimum of two weeks between installments. The consumer may prepay an extended payment plan in full at any time without penalty. As long as the consumer complies with the terms of the extended payment plan, the plan shall be at no additional cost to the consumer and the lender shall not charge the consumer any interest or additional fees during the term of the extended payment plan. The lender may, with each payment under the plan by the consumer, provide for the return of the consumer's prior held check and require a new check for the remaining balance under the plan.
(c) If the consumer fails to pay any extended payment plan installment when due, the consumer shall be in default of the payment plan and the lender may immediately accelerate payment on the remaining balance and take action to collect all amounts due.
(d) No additional payday loan shall be made to the consumer under this section during an extended payment plan.
(e) Lenders shall prominently display the availability of extended payment plans where loans are made and shall disclose the availability of extended payment plans in payday loan agreements.
(8) On a consumer loan transaction in which cash is advanced in exchange for a personal check, one return check charge may be charged if the check is deemed insufficient as defined in K.S.A. 16a-2-501(1)(e), and amendments thereto. Upon receipt of the check from the consumer, the lender shall immediately stamp the back of the check with an endorsement that states: "Negotiated as part of a loan made under K.S.A. 16a-2-404. Holder takes subject to claims and defenses of maker. No criminal prosecution."
(9) In determining whether a consumer loan transaction made under the provisions of this section is unconscionable conduct under K.S.A. 16a-5-108, and amendments thereto, consideration shall be given, among other factors, to:
(a) The ability of the borrower to repay within the terms of the loan made under this section; or
(b) the original request of the borrower for amount and term of the loan are within the limitations under this section.
(10) A consumer may rescind any consumer loan transaction made under the provisions of this section without cost not later than the end of the business day immediately following the day on which the loan transaction was made. To rescind the loan transaction:
(a) A consumer shall inform the lender that the consumer wants to rescind the loan transaction;
(b) the consumer shall return the cash amount of the principal of the loan transaction to the lender; and
(c) the lender shall return any fees that have been collected in association with the loan.
(11) A person shall not commit or cause to be committed any of the following acts or practices in connection with a consumer loan transaction subject to the provisions of this section:
(a) Use any device or agreement that would have the effect of charging or collecting more fees, charges or interest or that results in more fees, charges or interest being paid by the consumer, than allowed by the provisions of this section, including, but not limited to:
(i) Entering into a different type of transaction with the consumer;
(ii) entering into a sales/leaseback or rebate arrangement;
(iii) catalog sales; or
(iv) entering into any other transaction with the consumer or any other person that is designed to evade the applicability of this section;
(b) use, or threaten to use the criminal process in any state to collect on the loan;
(c) sell any other product of any kind in connection with the making or collecting of the loan;
(d) include any of the following provisions in a loan document:
(i) A hold harmless clause;
(ii) a confession of judgment clause;
(iii) a provision in which the consumer agrees not to assert a claim or defense arising out of the contract.
(12) As used in this section, "related interest" shall have the same meaning as "person related to" in K.S.A. 16a-1-301, and amendments thereto.
(13) Any person who facilitates, enables or acts as a conduit or agent for any third party who enters into a consumer loan transaction with the characteristics set out in subsections (1)(a) and (1)(b) shall be required to obtain a supervised loan license pursuant to K.S.A. 16a-2-301, and amendments thereto, regardless of whether the third party may be exempt from licensure provisions of the uniform consumer credit code.
(14) Notwithstanding that a person may be exempted by virtue of federal law from the interest rate, finance charge and licensure provisions of the uniform consumer credit code, all other provisions of the code shall apply to both the person and the loan transaction.
(15) This section shall be supplemental to and a part of the uniform consumer credit code.
History: L. 1993, ch. 75, § 1; L. 1999, ch. 107, § 20; L. 2001, ch. 50, § 1; L. 2004, ch. 29, § 1; L. 2005, ch. 144, § 12; L. 2024, ch. 6, § 52; January 1, 2025.
(a) Any person who makes a loan under the provisions of K.S.A. 16a-2-404, and amendments thereto, shall:
(1) Not garnish any wages or salary paid to a military borrower for service in the armed forces.
(2) Defer all collection activity against a military borrower who has been deployed to a combat or combat support posting for the duration of such posting.
(3) Not contact any person in the military chain of command of a military borrower in an attempt to collect such loan.
(4) Honor all terms of any repayment agreement between the person making such loan and:
(A) The military borrower; or
(B) any military counselor or third party credit counselor negotiating on behalf of the military borrower.
(5) Not make any loan to any military borrower whenever the military base commander has declared such person's place of business off limits to military personnel.
(b) For the purposes of this section, "military borrower" means any of the following that have been called to active duty:
(1) Any member of the armed forces of the United States;
(2) any member of the national guard; or
(3) any member of the armed forces reserves.
(c) This section shall be supplemental to and a part of the uniform consumer credit code.
History: L. 2005, ch. 144, § 22; July 1.
(1) In addition to the finance charge permitted by the parts of this article on maximum finance charges for consumer credit sales and consumer loans, a creditor may contract for and receive the following additional charges in connection with a consumer credit transaction:
(a) Official fees and taxes;
(b) charges for insurance as described in subsection (2);
(c) late fees permitted under K.S.A. 16a-2-502, and amendments thereto, and service charges for insufficient payment methods permitted under paragraph (e);
(d) charges for other benefits, including insurance, conferred on the consumer, if the benefits are of value to the consumer and if the charges are reasonable in relation to the benefits, are of a type which is not for credit, and are excluded as permissible additional charges from the finance charge by rules and regulations adopted by the administrator;
(e) a service charge for an insufficient payment method, not to exceed $30, subject to the limitations contained in this subsection:
(i) For the purposes of this subsection, "insufficient payment method" means any instrument as defined in K.S.A. 84-3-104, and amendments thereto, drawn on any financial institution for the payment of money of preexisting indebtedness of the drawer or maker, which is refused payment by the drawee because the drawer or maker does not have sufficient funds in or credits with the drawee to pay the amount of the instrument upon presentation. Any payment instrument that is postdated or delivered to a payee who has knowledge at the time of delivery that the drawer or maker did not have sufficient funds in or credits with the drawee to pay the amount of the check, draft or order upon presentation shall not be deemed an insufficient payment instrument.
(ii) "Notice" shall be given to a consumer providing an insufficient payment method by one of the following methods:
(1) First class mail addressed to the consumer's last known address; or
(2) a clear notice of the insufficient payment method charge on the consumer's regular monthly statement.
(iii) If the consumer does not pay the amount of the insufficient payment plus the service charge to the payee within 14 days from the giving of notice, the payee may add the service charge to the outstanding balance of the preexisting indebtedness of the consumer to draw interest at the contract rate applicable to the preexisting indebtedness.
(f) Notwithstanding the provisions of subsection (e)*, if an insufficient payment method has been given to a creditor under a lender credit card, the creditor may charge a service charge for the insufficient payment method in an amount not to exceed the amount agreed to by the drawer or maker.
(2) Except as otherwise provided for in this act, a creditor may agree to provide insurance and may contract for and receive an additional charge for insurance written in connection with the transaction, including vendor's single interest insurance with respect to which the insurer has no right of subrogation against the consumer but excluding other insurance protecting the creditor against the consumer's default or other credit loss:
(a) With respect to insurance against loss of or damage to property or against liability, if the creditor furnishes a clear and specific statement in writing to the consumer setting forth the cost of the insurance if obtained from or through the creditor and stating that the consumer may choose the person through whom the insurance is to be obtained;
(b) with respect to consumer credit insurance providing life, accident and health or loss of employment coverage, if the insurance coverage is not a factor in the approval by the creditor of the extension of credit, and this fact is clearly disclosed in writing to the consumer, and if, in order to obtain the insurance in connection with the extension of credit, the consumer gives specific affirmative written indication of the consumer's desire to do so after written disclosure to the consumer of the cost thereof;
(c) a creditor need not make a separate charge for insurance provided or required by such creditor. This act does not authorize the issuance of any insurance prohibited under any statute, or rule thereunder, governing the business of insurance; and
(d) the excess amount of a charge for insurance provided for in agreements in violation of this act is an excess charge for the purposes of this act.
(3) With respect to a consumer loan or a consumer credit sale in either case pursuant to open-end credit, a creditor may charge the following fees in an amount not to exceed that agreed to by the consumer:
(a) Fees on a monthly or annual basis;
(b) over-limit fees; and
(c) cash advance fees. The fees permitted under this subsection are in addition to any finance charges, additional charges or other charges permitted by the uniform consumer credit code.
(4) A charge not exceeding $5 per payment, if the borrower makes a single installment payment by authorizing a creditor, verbally or in writing, to make a payment through electronic methods subject to the following limitations:
(a) No charge shall be assessed if the creditor also collects a late fee on the same installment; and
(b) no charge shall be assessed where the consumer has agreed in writing with the creditor to make all scheduled payments through the use of electronic methods.
History: L. 1973, ch. 85, § 29; L. 1987, ch. 80, § 1; L. 1988, ch. 88, § 1; L. 1988, ch. 89, § 1; L. 1988, ch. 87, § 3; L. 1990, ch. 209, § 2; L. 1991, ch. 72, § 1; L. 1996, ch. 174, § 1; L. 1999, ch. 107, § 18; L. 2004, ch. 32, § 1; L. 2024, ch. 6, § 53; January 1, 2025.
(1) The parties to a consumer credit transaction may contract for a late fee on any installment not paid in full within 10 calendar days after its scheduled or deferred due date in an amount not exceeding 5% of the unpaid amount of the installment or $25, whichever is less.
(2) As an alternative to the late fee set forth in subsection (1), the parties to a consumer credit transaction may contract for a late fee not to exceed $10 on any installment not paid in full within 10 calendar days after its scheduled or deferred due date, except that if the scheduled payment amount is $25 or less, the maximum late fee shall be $5.
(3) A late fee may be collected only once on an installment however long it remains in default. A late fee may be collected at the time it is assessed or at any time thereafter.
(4) No late fee may be assessed when such a fee or charge is attributable solely to failure of the consumer to pay a late fee on an earlier installment and the payment is otherwise a periodic payment received on the due date, or within 10 calendar days after its scheduled or deferred installment due date.
(5) Notwithstanding subsections (1), (2) and (4), the parties to a lender credit card agreement may contract for a late fee in an amount agreed to by the consumer and may impose such charge on any installment not paid in full on the next business day following the scheduled due date of the late payment.
(6) Notwithstanding subsections (1), (2) and (4), no late fee may be collected on a lender credit card installment which is paid in full on the next business day following the scheduled or deferred due date even though an earlier maturing installment or a late fee on an earlier installment may not have been paid in full.
History: L. 1973, ch. 85, § 30; L. 1975, ch. 127, § 3; L. 1988, ch. 85, § 7; L. 1988, ch. 86, § 4; L. 1988, ch. 87, § 4; L. 1992, ch. 46, § 1; L. 1993, ch. 200, § 8; L. 1994, ch. 39, § 1; L. 1996, ch. 166, § 4; L. 1999, ch. 107, § 19; L. 2024, ch. 6, § 54; January 1, 2025.
History: L. 1973, ch. 85, § 31; Repealed, L. 1993, ch. 200, § 15; January 1, 1994.
With respect to a consumer credit transaction, the creditor may by agreement with the consumer refinance the unpaid balance, including any accrued charges. For the purpose of determining the finance charge permitted, the amount financed resulting from the refinancing refinanced shall be the total of the unpaid balance and the accrued charges on the date of the refinancing.
History: L. 1973, ch. 85, § 32; L. 1993, ch. 200, § 9; L. 2024, ch. 6, § 55; January 1, 2025.
(1) If a consumer owes an unpaid balance to a creditor with respect to a consumer credit transaction and becomes obligated on another consumer credit transaction with the same creditor, the parties may agree to a consolidation resulting in a single schedule of payments. The parties may agree to add the unpaid amount of the amount financed and accrued charges on the date of consolidation to the amount financed with respect to the subsequent consumer credit transaction.
The creditor may contract for and receive a finance charge as provided in subsection (2) based on the aggregate amount financed resulting from the consolidation.
(2) If the debts consolidated arise exclusively from consumer credit sales the transaction is a consolidation as a consumer credit sale and the amount of the finance charge is governed by the provisions on finance charge for consumer credit sales other than open-end credit. If the debts consolidated include a debt arising from a consumer loan, the transaction is a consolidation as a consumer loan and the amount of the finance charge is governed by the provisions on finance charges for consumer loans.
History: L. 1973, ch. 85, § 33; L. 1993, ch. 200, § 10; L. 2024, ch. 6, § 56; January 1, 2025.
(1) If a consumer credit transaction agreement requires a consumer to insure or preserve the collateral and the consumer fails to do so, after providing the consumer prior notification and a reasonable opportunity to perform, the creditor may pay for the performance of insuring or preserving the collateral on the consumer's behalf and may add the payment to the unpaid debt balance. Within a reasonable time after advancing any sums, the creditor shall state to the buyer in writing the amount of the sums advanced, any charges with respect to this amount, and any revised payment schedule and, if the duties of the consumer performed by the creditor pertain to insurance, a brief description of the insurance paid for by the creditor including the type and amount of coverages. No further information need be given.
(2) A finance charge may be made for sums advanced pursuant to subsection (1) at a rate not to exceed the rate stated to the consumer pursuant to law in a disclosure statement, except that with respect to open-end credit the amount of the advance may be added to the unpaid balance of the debt and the creditor may make a finance charge not exceeding that permitted by the appropriate provisions on finance charge for consumer credit sales pursuant to open-end credit or for consumer loans, whichever is appropriate.
History: L. 1973, ch. 85, § 34; L. 2024, ch. 6, § 57; January 1, 2025.
(1) (a) With respect to a consumer credit transaction, the agreement may provide for the payment by the debtor of reasonable costs of collection paid to outside parties, including, but not limited to, court costs, attorney fees and collection agency fees, except that such costs of collection shall not:
(A) Include costs that were incurred by a salaried employee of the creditor or its assignee;
(B) include the recovery of both attorney fees and collection agency fees; or
(C) be in excess of 15% of the unpaid debt after default.
(2) A provision in violation of this subsection shall be unenforceable.
(b) Reasonable collection costs and attorney fees pursuant to subsection (a) shall be considered separate from reasonable expenses incurred on realizing a security interest pursuant to K.S.A. 16a-3-402, and amendments thereto.
History: L. 1973, ch. 85, § 35; L. 1994, ch. 276, § 1; L. 2024, ch. 6, § 58; January 1, 2025.
The parties may agree to add the unpaid balance of a consumer credit transaction not made pursuant to open-end credit to the consumer's open-end credit account with the creditor. The unpaid balance so added shall be an amount equal to the amount financed determined according to the provisions on finance charge on refinancing.
History: L. 1973, ch. 85, § 36; L. 2024, ch. 6, § 59; January 1, 2025.
The consumer may prepay in full the unpaid balance of a consumer credit transaction at any time without penalty.
History: L. 1973, ch. 85, § 37; L. 1993, ch. 200, § 11; January 1, 1994.
(1) Upon prepayment in full, but not upon a refinancing of a consumer credit transaction other than one pursuant to open-end credit, the creditor may collect or retain a minimum charge of $10, if the minimum charge was contracted for and the finance charge earned at the time of prepayment is less than the minimum charge contracted for. If the finance charge is less than the minimum provided therefor, then the finance charge so contracted may be retained as the minimum finance charge.
(2) If the maturity is accelerated for any reason and judgment is obtained, the judgment shall be taken in accordance with the provisions of K.S.A. 16-205, and amendments thereto.
(3) Upon prepayment in full of a consumer credit contract by proceeds of consumer credit insurance, the consumer or the consumer's estate shall be entitled to the same rebate as though the consumer had prepaid the agreement on the date the proceeds of the insurance are paid to the creditor, but no later than 10 business days after satisfactory proof of loss is furnished to the creditor.
History: L. 1973, ch. 85, § 38; L. 1974, ch. 90, § 2; L. 1982, ch. 93, § 4; L. 1988, ch. 85, § 8; L. 1988, ch. 86, § 5; L. 1993, ch. 200, § 12; L. 1999, ch. 107, § 21; L. 2024, ch. 6, § 60; January 1, 2025.
History: L. 1988, ch. 85, § 11; Repealed, L. 1992, ch. 46, § 5; July 1.
History: L. 1973, ch. 85, § 39; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
History: L. 1973, ch. 85, § 40; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
A lessor shall disclose to the consumer the information required by rules and regulations adopted by the administrator pursuant to K.S.A. 16a-6-104, and amendments thereto.
History: L. 1973, ch. 85, § 41; L. 1992, ch. 46, § 2; L. 2024, ch. 6, § 61; January 1, 2025.
(1) A written agreement that requires or provides for the signature of the consumer and that evidences a consumer loan or consumer credit sale other than one pursuant to open-end credit shall contain a clear, conspicuous, and printed notice to the consumer that such consumer should not sign the agreement before reading it, and that such consumer is entitled to a copy of the agreement and may prepay the unpaid balance at any time without penalty. The following notice if clearly and conspicuously printed complies with this subsection:
NOTICE TO CONSUMER: 1. Do not sign this agreement before you read it. 2. You are entitled to a copy of this agreement. 3. You may prepay the unpaid balance at any time without penalty.
(2) A written agreement that requires or provides for the signature of the consumer and that evidences a consumer lease shall contain a clear, conspicuous and printed notice to the consumer that such consumer should not sign the agreement before reading it and that such consumer is entitled to a copy of the agreement. The following notice if clearly and conspicuously printed complies with this subsection:
NOTICE TO CONSUMER: 1. Do not sign this agreement before you read it. 2. You are entitled to a copy of this agreement.
History: L. 1973, ch. 85, § 42; L. 2024, ch. 6, § 62; January 1, 2025.
(1) The consumer is authorized to pay the original creditor until he receives notification of assignment of rights to payment pursuant to a consumer credit transaction and that payment is to be made to the assignee. A notification which does not reasonably identify the rights assigned is ineffective. If requested by the consumer, the assignee must provide reasonable proof that the assignment has been made or the consumer may pay the original creditor.
(2) If the payment is received by the assignor of a consumer credit contract for the benefit of the assignee, the date of payment shall be deemed to be the day payment is received by the assignor.
History: L. 1973, ch. 85, § 43; L. 2024, ch. 6, § 63; January 1, 2025.
History: L. 1996, ch. 166, § 1; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
(1) If a creditor makes a change in the terms of an open-end credit account without complying with this section any additional cost or charge to the consumer resulting from the change is an excess charge and subject to the remedies available to consumers and to the administrator.
(2) A creditor may change the terms, including the finance charge, of an open-end credit account whether or not the change is authorized by prior agreement. Except as provided in subsection (3), the creditor shall give to the consumer written notice of any change at least 30 days before the effective date of the change.
(3) The notice specified in subsection (2) is not required if:
(a) The consumer elects to pay an amount designated on a billing statement as including a new charge for a benefit offered to the consumer when the benefit and charge constitute the change in terms and when the billing statement also states the amount payable if the new charge is excluded;
(b) the change involves no significant cost to the consumer; or
(c) the change applies only to debts incurred after a date specified in a notice of the change.
(4) The notice provided for in this section is given to the consumer when mailed to the consumer at the address used by the creditor for sending periodic billing statements.
History: L. 1973, ch. 85, § 44; L. 1980, ch. 77, § 4; L. 1981, ch. 94, § 4; L. 1982, ch. 93, § 5; L. 1983, ch. 79, § 4; L. 1985, ch. 82, § 4; L. 1987, ch. 81, § 1; L. 1993, ch. 49, § 1; L. 2024, ch. 6, § 64; January 1, 2025.
(1) The creditor shall deliver or mail to the consumer, without request, a written receipt for each payment by coin or currency on an obligation pursuant to a consumer credit transaction. A periodic statement showing a payment received by mail or electronic methods shall comply with this subsection.
(2) Upon written request of the consumer, the person to whom an obligation is owed pursuant to a consumer credit transaction, other than one pursuant to open-end credit, shall provide a written statement of the dates and amounts of payments made within the past 15 months and the amount required to pay the debt in full. The statement shall be provided without charge.
(3) After a consumer has fulfilled all obligations with respect to a consumer credit transaction, other than one pursuant to open-end credit, the person to whom the obligation was owed shall upon request of the consumer, deliver or mail to the consumer written evidence acknowledging payment in full of all obligations with respect to the transaction.
History: L. 1973, ch. 85; § 45; L. 2005, ch. 144, § 13; L. 2024, ch. 6, § 65; January 1, 2025.
A creditor shall disclose to the consumer the information required by the rules and regulations adopted by the administrator pursuant to K.S.A. 16a-6-104, and amendments thereto.
History: L. 1973, ch. 85, § 46; L. 1981, ch. 93, § 6; L. 1987, ch. 80, § 2; L. 2024, ch. 6, § 66; January 1, 2025.
History: L. 1999, ch. 107, § 1; L. 2000, ch. 64, § 2; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
(1) No person shall make, directly or indirectly, a false, misleading or deceptive advertisement regarding loans or the availability of loans.
(2) No person shall advertise the size of any loan, security required for a loan, rate of charge or other conditions of lending except with the full intent of making loans at those rates, or lower rates, and under those conditions or conditions more favorable to the consumer, to loan applicants who meet the standards or qualifications prescribed.
(3) This section shall be supplemental to and a part of the uniform consumer credit code.
History: L. 1999, ch. 107, § 2; L. 2024, ch. 6, § 67; January 1, 2025.
(a) Unless otherwise specifically stated, for the purposes of K.S.A. 16a-1-101 et seq., and amendments thereto, in computing any period of time, calendar days shall be used. The day of the act, event or default from which the designated period of time begins to run shall not be included. Saturdays, Sundays and legal holidays are included, unless the last day of the period so computed is a Saturday, Sunday or a legal holiday, in which event the period runs until the end of the next day which is not a Saturday, Sunday or a legal holiday. "Legal holiday" includes any day designated as a holiday by the Federal Reserve Bank.
(b) This section shall be part of and supplemental to the uniform consumer credit code.
History: L. 2009, ch. 29, § 1; L. 2024, ch. 6, § 68; January 1, 2025.
(1) Any writing or signature required by this act may be provided or executed using an electronic format pursuant to K.S.A. 16-1601 et seq., and amendments thereto.
(2) If a consumer agrees in writing to the use of an electronic format instead of United States mail to send a document, any requirement under this act to use United States mail to send a document may be satisfied by sending the document by such electronic format. When a document is sent using an electronic format, the time of sending and receipt is defined pursuant to K.S.A. 16-1615, and amendments thereto.
(3) This section shall be a part of and supplemental to the uniform consumer credit code.
History: L. 2024, ch. 6, § 16; January 1, 2025.
(1) With respect to a consumer credit sale, a seller may take a security interest in the property sold. In addition, a seller may take a security interest in goods upon which services are performed or in which goods sold are installed or to which they are annexed or in land to which the goods are affixed or which is maintained, repaired or improved as a result of the sale of the goods or services, if in the case of a security interest in land the debt secured is $3,000 or more, or, in the case of a security interest in goods the debt secured is $900 or more. Except as provided with respect to cross-collateral, a seller may not otherwise take a security interest in property of the buyer to secure the debt arising from a consumer credit sale.
(2) With respect to a consumer lease, a lessor may not take a security interest in property of the lessee to secure the amount payable arising from the lease.
(3) A security interest taken in violation of this section shall be void.
History: L. 1973, ch. 85, § 47; L. 1981, ch. 93, § 7; L. 1999, ch. 107, § 22; L. 2024, ch. 6, § 69; January 1, 2025.
(1) In addition to contracting for a security interest pursuant to the provisions on security in sales or leases, a seller in a consumer credit sale may secure the debt arising from the sale by contracting for a security interest in other property if as a result of a prior sale the seller has an existing security interest in the other property. The seller may also contract for a security interest in the property sold in the subsequent sale as security for the previous debt.
(2) If the seller contracts for a security interest in other property pursuant to this section, the finance charge thereafter on the aggregate unpaid balances so secured may not exceed that permitted if the balances so secured were consolidated pursuant to the provisions on consolidation involving a refinancing. The seller shall have a reasonable time after so contracting to make any adjustments required by this section. "Seller" in this section does not include an assignee not related to the original seller.
History: L. 1973, ch. 85, § 48; L. 2024, ch. 6, § 70; January 1, 2025.
(1) If debts arising from two or more consumer credit sales, other than sales pursuant to open-end credit, are secured by cross-collateral or consolidated into one debt payable on a single schedule of payments, and the debt is secured by security interests taken with respect to one or more of the sales, payments received by the seller after the taking of the cross-collateral or the consolidation are deemed, for the purpose of determining the amount of the debt secured by the various security interests, to have been first applied to the payment of the debts arising from the sales first made. To the extent debts are paid according to this section, security interests in items of property shall terminate as the debt originally incurred with respect to each item is paid.
(2) Payments received by the seller upon an open-end credit account are deemed, for the purpose of determining the amount of the debt secured by the various security interests, to have been applied first to the payment of finance charges in the order of their entry to the account and then to the payment of debts in the order in which the entries to the account showing the debts were made.
(3) If the debts consolidated arose from two or more sales made on the same day, payments received by the seller are deemed, for the purpose of determining the amount of the debt secured by the various security interests, to have been applied first to the payment of the smallest debt.
History: L. 1973, ch. 85, § 49; L. 1981, ch. 93, § 8; L. 2024, ch. 6, § 71; January 1, 2025.
(1) No creditor may engage in a pattern or practice of using multiple agreements to obtain a higher finance charge than would otherwise be permitted by the provisions of K.S.A. 16a-1-101 et seq., and amendments thereto.
(2) The excess amount of finance charge in this section is an excess charge for the purposes of the provisions on rights of parties and the provisions on civil actions by the administrator.
History: L. 1973, ch. 85, § 50; L. 1977, ch. 71, § 2; L. 1999, ch. 107, § 23; L. 2005, ch. 144, § 14; L. 2024, ch. 6, § 72; January 1, 2025.
(1) No creditor may take an assignment of earnings of the consumer for payment or as security for payment of a debt arising out of a consumer credit transaction. An assignment of earnings in violation of this section is unenforceable by the assignee of the earnings and revocable by the consumer. This section does not prohibit an employee from authorizing deductions from such employee's earnings if the authorization is revocable.
(2) A sale of unpaid earnings made in consideration of the payment of money to or for the account of the seller of the earnings is deemed to be a loan to the consumer secured by an assignment of earnings.
History: L. 1973, ch. 85, § 51; L. 2024, ch. 6, § 73; January 1, 2025.
No consumer or any other person acting on the consumer's behalf may authorize any person to confess judgment on a claim arising out of a consumer credit transaction. An authorization in violation of this section shall be void.
History: L. 1973, ch. 85, § 52; L. 2024, ch. 6, § 74; January 1, 2025.
With respect to a consumer credit sale or consumer lease, the creditor shall only accept currently dated negotiable instruments as evidence of the obligation of the buyer or lessee. For purposes of this section, a creditor shall not make the consumer credit sale contract or consumer lease contract a negotiable instrument.
History: L. 1973, ch. 85, § 53; L. 1981, ch. 93, § 9; L. 2024, ch. 6, § 75; January 1, 2025.
In a consumer credit transaction with a balloon payment, other than one pursuant to open-end credit, the consumer shall have the right to refinance the amount of that payment at the time it is due without penalty. The terms of the refinancing shall be no less favorable to the consumer than the terms of the original transaction. The provisions of this section shall not apply to the extent that the payment schedule is adjusted to the seasonal or irregular income of the consumer.
History: L. 1973, ch. 85, § 54; L. 1981, ch. 93, § 10; L. 1991, ch. 73, § 1; L. 2002, ch. 125, § 1; L. 2009, ch. 29, § 20; L. 2024, ch. 6, § 76; January 1, 2025.
History: L. 1999, ch. 107, § 3; L. 2005, ch. 144, § 15; L. 2006, ch. 67, § 1; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
(1) (a) In a consumer credit sale, no seller shall offer or give a rebate, discount or otherwise pay value to the buyer in consideration of the buyer giving the seller the names of third parties, or otherwise assist the seller in making a sale to a third party when the earning of the rebate, discount or other value is contingent upon an event subsequent to the time of the sale.
(b) In a consumer lease, no lessor shall offer or give a rebate, discount or otherwise pay value to the lessee in consideration of the lessee giving to the lessor the names of third parties, or otherwise aiding the lessor in leasing to a third party when the earning of the rebate, discount or other value is contingent upon an event subsequent to the time of the lease.
(2) If a buyer or lessee is induced by a violation of this section to enter into a consumer credit sale or consumer lease, the agreement shall be unenforceable by the seller or lessor and the buyer or lessee, at the buyer's or lessee's option, may rescind the agreement or retain the goods delivered and the benefit of any services performed, without any obligation to pay for them.
History: L. 1974, ch. 85, § 55; L. 2024, ch. 6, § 77; January 1, 2025.
The obligation of a lessee upon expiration of a consumer lease may not exceed twice the average payment allocable to a monthly period under the lease. This limitation does not apply to charges for damages to the leased property or for other default.
History: L. 1973, ch. 85, § 56; L. 1981, ch. 93, § 11; July 1.
Except for reasonable expenses incurred in realizing on a security interest, the agreement with respect to a consumer credit transaction may not provide for any charges as a result of default by the consumer other than those authorized by K.S.A. 16a-1-101 et seq., and amendments thereto. A provision in violation of this section shall be unenforceable.
History: L. 1973, ch. 85, § 57; L. 2024, ch. 6, § 78; January 1, 2025.
(1) If the issuer of a credit card, other than a lender credit card, is the seller or lessor or a person related to the seller or lessor, or if the seller or lessor is licensed, franchised or permitted by the issuer to do business under the business name or trade name or designation of the issuer, the issuer is subject to all claims and defenses of a buyer or lessee against the seller or lessor arising out of a sale or lease of goods or services pursuant to the credit card.
(2) The issuer of a lender credit card is not subject to the claims and defenses of a buyer or lessee arising out of a sale or lease of goods or services pursuant to a lender credit card except where a home solicitation sale is involved. For purposes of this section, a "home solicitation sale" means a sale to a consumer of goods (other than equipment used in a business) or services, in which the seller or a person acting for the seller engages in a personal solicitation (other than by telephone or mail) of the sale at a residence of the buyer. It does not include a sale made pursuant to prior negotiations between the parties at a business establishment at a fixed location where goods or services are offered or exhibited for sale.
(3) Claims or defenses of a buyer or lessee against a seller or lessor in connection with a home solicitation sale may be asserted against the issuer of the lender credit card only:
(a) If the buyer or lessee has attempted in good faith to obtain reasonable satisfaction from the seller or lessor with respect to claims or defenses, and
(b) to the extent of the amount owing to the issuer with respect to the sale or lease at the time the issuer has notice of the claims or defenses. Notice of the claims or defenses may be given prior to the attempt specified in paragraph (a). The notice, which may generally state the claims or defenses, shall be in writing and sent to the seller, the lessor or to the issuer.
(4) For the purpose of determining the amount owing to the issuer with respect to a sale or lease under a credit card, payments received upon the account are deemed to have been first applied to the payment of finance charges in the order of their entry to the account and then to the payment of debts in the order in which the entries of the debts are made to the account.
(5) An agreement may not provide for greater rights for an issuer of a credit card than this section permits.
History: L. 1973, ch. 85, § 58; L. 1981, ch. 93, § 12; L. 2024, ch. 6, § 79; January 1, 2025.
(1) An assignee of the rights of the seller or lessor under a consumer credit sale or consumer lease is subject to all claims and defenses of the buyer or lessee against the seller or lessor arising out of the sale or lease, notwithstanding that:
(a) There is an agreement to the contrary; or
(b) the assignee is a holder in due course of a negotiable instrument issued in violation of the provisions prohibiting certain negotiable instruments.
(2) Claims or defenses of a buyer or lessee specified in subsection (1) may be asserted against the assignee only:
(a) If the buyer or lessee has attempted in good faith to obtain reasonable satisfaction from the seller or lessor with respect to claims or defenses;
(b) if the buyer or lessee, when requested in writing to do so by the seller, lessor or the assignee, has given notice in writing to the seller or lessee and the assignee stating the claims or defenses;
(c) to the extent of the amount owing to the assignee with respect to the sale or lease at the time the assignee has notice of such claims or defenses. Such notice, generally stating the claims or defenses, shall be in writing and shall be sent to the seller or lessor and to the assignee if the buyer or lessee has received written notice of the name and address of the assignee; and
(d) as a matter of defense to or setoff against claims by the assignee except that the buyer or lessee shall not be prohibited from bringing an action to rescind an obligation against which it has a defense or setoff.
(3) For the purpose of determining the amount owing to the assignee with respect to the sale or lease:
(a) Payments received by the assignee after the consolidation of two or more consumer credit sales, other than pursuant to open-end credit, are deemed to have been first applied to the payment of the sales first made; if the sales consolidated arose from sales made on the same day, payments are deemed to have been first applied to the smaller or smallest sale or sales;
(b) payments received upon an open-end credit account are deemed to have been first applied to the payment of finance charges in the order of their entry to the account and then to the payment of debts in the order in which the entries of the debts are made to the account.
(4) Any action by an assignee or the original seller or lessor who has repurchased an obligation under subsection (5) to enforce an obligation, or any action by a buyer or lessee to rescind or any request to repurchase the obligation, shall be brought within one year from the date of receipt of the notice of the claim or defense, or default in payment, whichever is later.
(5) If a claim or defense of a buyer or lessee against a seller or lessor is asserted against an assignee, the assignee may, regardless of any existing agreement to the contrary, require the seller or lessor to repurchase the obligation for an amount equal to the price for which the obligation was assigned, plus that portion of the finance charge earned by the assignee, minus payments previously made to the assignee by the buyer or lessee. In any action by the buyer or lessee to rescind an obligation held by the assignee, the seller or lessor shall have the right to intervene and any party may join as a defendant any manufacturer or other person who is or may be liable to another party. If the action to rescind is brought against the seller or lessor, such seller or lessor shall have the right to join as a defendant any manufacturer or other person who is or may be liable to such seller or lessor.
(6) An agreement may not provide greater rights for an assignee than this section permits.
History: L. 1973, ch. 85, § 59; L. 1975, ch. 127, § 1; L. 1976, ch. 145, § 40; L. 1981, ch. 93, § 13; L. 2024, ch. 6, § 80; January 1, 2025.
(1) A lender, other than the issuer of a lender credit card, who, with respect to a particular transaction, makes a consumer loan for the purpose of enabling a consumer to buy or lease from a particular seller or lessee goods or services is subject to all claims and defenses of the consumer against the seller or lessor arising from that sale or lease of the goods and services if:
(a) The lender knows that the seller or lessor arranged, for a commission, brokerage or referral fee, for the extension of credit by the lender;
(b) the lender is a person related to the seller or lessor unless the relationship is remote or is not a factor in the transaction;
(c) the seller or lessor guarantees the loan or otherwise assumes the risk or loss by the lender upon the loan;
(d) the lender directly supplies the seller or lessor with the contract document used by the consumer to evidence the loan, and the seller or lessor significantly participates in the preparation of the document; or
(e) the loan is conditioned upon the consumer's purchase or lease of the goods or services from the particular seller or lessor, but the lender's payment of proceeds of the loan to the seller or lessor does not in itself establish that the loan was so conditioned.
(2) Claims or defenses of a buyer or lessee specified in subsection (1) may be asserted against the lender only:
(a) If the buyer or lessee has attempted in good faith to obtain reasonable satisfaction from the seller or lessor with respect to the claims or defenses;
(b) if the buyer or lessee, when requested in writing to do so by the seller, lessor or the lender, has given notice in writing to the seller or lessee and the lender stating the claims or defenses;
(c) to the extent of the amount owing to the lender with respect to the sale or lease at the time the lender has notice of the claims or defenses. Such notice, generally stating the claims or defenses, shall be in writing and shall be sent to the seller (or lessor), and to the lender if the buyer or lessee has received written notice of the name and address of the lender; and
(d) as a matter of defense to or setoff against claims by the lender except that the buyer or lessee shall not be prohibited from bringing an action to rescind an obligation against which it has a defense or setoff.
(3) For the purpose of determining the amount owing to the lender with respect to the sale or lease:
(a) Payments received by the lender after the consolidation of two or more consumer loans, other than pursuant to open-end credit, are deemed to have been first applied to the payment of the loans first made; if the loans consolidated arose from loans made on the same day, payments are deemed to have been first applied to the smaller or smallest loan or loans; and
(b) payments received upon an open-end credit account are deemed to have been first applied to the payment of finance charges in the order of their entry to the account and then to the payment of debts in the order in which the entries of the debts are made to the account.
(4) An agreement may not provide greater rights for a lender than this section permits.
(5) Notwithstanding any of the foregoing, the participation of the lender or lessor in any of the arrangements between seller and buyer to insure the perfection of the lender or lessor's security interest shall not in itself establish a relationship described and controlled by subsection (1).
History: L. 1973, ch. 85, § 60; L. 1975, ch. 127, § 2; L. 1981, ch. 93, § 14; L. 2024, ch. 6, § 81; January 1, 2025.
History: L. 1973, ch. 85, § 61; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
(1) Except as provided in subsection (2), this article applies to insurance provided or to be provided in relation to a consumer credit transaction.
(2) The provision on cancellation by a creditor applies to loans the primary purpose of which is the financing of insurance. No other provision of this article applies to insurance so financed.
History: L. 1973, ch. 85, § 62; L. 2024, ch. 6, § 82; January 1, 2025.
History: L. 1973, ch. 85, § 63; L. 1982, ch. 95, § 1; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
(1) Except as otherwise provided in this article and subject to the provisions on additional charges and maximum finance charges, a creditor may agree to provide insurance, and may contract for and receive a charge for insurance separate from and in addition to other charges. A creditor need not make a separate charge for insurance provided or required by him. This act does not authorize the issuance of any insurance prohibited under any statute, or rule thereunder, governing the business of insurance.
(2) The excess amount of a charge for insurance provided for in agreements in violation of this article is an excess charge for the purposes of the provisions of the article on remedies and penalties as to effect of violations on rights of parties and of the provisions of the article on administration as to civil actions by the administrator.
History: L. 1973, ch. 85, § 64; L. 2024, ch. 6, § 83; January 1, 2025.
If a creditor agrees with a consumer to provide insurance:
(1) The insurance shall be evidenced by an individual policy or certificate of insurance delivered to the consumer, or sent to such consumer at such consumer's address, as provided, within 30 days after the term of the insurance commences under the agreement between the creditor and consumer; or
(2) the creditor shall promptly notify the consumer of any failure or delay in providing the insurance.
History: L. 1973, ch. 85, § 65; L. 2024, ch. 6, § 84; January 1, 2025.
(1) In applying the provisions of this act on unconscionability to a separate charge for insurance, consideration shall be given, among other factors, to:
(a) Potential benefits to the consumer including the satisfaction of his obligations;
(b) the creditor's need for the protection provided by the insurance; and
(c) the relation between the amount and terms of credit granted and the insurance benefits provided.
(2) If consumer credit insurance otherwise complies with this article and other applicable law, then neither the amount, the term of the insurance nor the charge of the insurance is unconscionable.
History: L. 1973, ch. 85, § 66; L. 2024, ch. 6, § 85; January 1, 2025.
(1) Except as provided in subsection (2), if a creditor contracts for or receives a separate charge for insurance, the amount charged to the consumer for the insurance may not exceed the premium to be charged by the insurer, as computed at the time the charge to the consumer is determined, conforming to any rate filings required by law and made by the insurer with the commissioner of insurance.
(2) A creditor who provides consumer credit insurance in relation to open-end credit may calculate the charge to the consumer in each billing cycle by applying the current premium rate to the unpaid balance of debt in the same manner as is permitted with respect to finance charges for consumer credit sales pursuant to open-end credit.
History: L. 1973, ch. 85, § 67; L. 2024, ch. 6, § 86; January 1, 2025.
(1) Upon prepayment in full of a consumer credit sale or consumer loan by the proceeds of consumer credit insurance, the consumer or such consumer's estate is entitled to a refund of any portion of a separate charge for insurance which by reason or prepayment is retained by the creditor or returned by the insurer unless the charge was computed from time to time on the basis of the balances of the consumer's account.
(2) This article does not require a creditor to grant a refund or credit to the consumer if all refunds and credits due under this article amount to less than $5, and except as provided in subsection (1) does not require the creditor to account to the consumer for any portion of a separate charge for insurance because:
(a) The insurance is terminated by performance of the insurer's obligation;
(b) the creditor pays or accounts for premiums to the insurer in amounts and at times determined by the agreement between them; or
(c) the creditor receives directly or indirectly under any policy of insurance a gain or advantage not prohibited by law.
(3) Except as provided in subsection (2), the creditor shall promptly make or cause to be made an appropriate refund or credit to the consumer for any separate charge made to such consumer for insurance if:
(a) The insurance is not provided or is provided for a shorter term than that for which the charge to the consumer for insurance was computed; or
(b) the insurance terminates prior to the end of the term for which it was written because of prepayment in full or otherwise.
(4) A refund or credit required by subsection (3) is appropriate as to amount if it is computed according to a method prescribed or approved by the commissioner of insurance or a formula filed by the insurer with the commissioner of insurance at least 30 days before the consumer's right to a refund or credit becomes determinable, unless the method or formula is employed after the commissioner of insurance notifies the insurer that it was not approved.
History: L. 1973, ch. 85, § 68; L. 2024, ch. 6, § 87; January 1, 2025.
If a creditor requires insurance, the consumer shall have the option of providing the required insurance through an existing policy of insurance owned or controlled by the consumer, or through a policy obtained and paid for by the consumer, but the creditor may for reasonable cause decline the insurance provided by the consumer. The creditor shall provide the consumer with a written notice on the loan agreement or other instrument fully informing the consumer of the option authorized by this section.
History: L. 1973, ch. 85, § 69; L. 1988, ch. 153, § 2; L. 2024, ch. 6, § 88; January 1, 2025.
(1) A creditor may not contract for or receive a separate charge for insurance in connection with a refinancing or a consolidation, unless:
(a) The consumer agrees at or before the time of refinancing or consolidation that the charge may be made;
(b) the consumer is or is to be provided with insurance for an amount or a term, or insurance of a kind, in addition to that to which said consumer would have been entitled had there been no refinancing or consolidation;
(c) the consumer receives a refund or credit on account of any unexpired term of existing insurance in the amount that would be required if the insurance were terminated; and
(d) the charge does not exceed the amount permitted by this article.
(2) A creditor may not contract for or receive a separate charge for insurance which duplicates insurance with respect to which the creditor has previously contracted for or received a separate charge.
History: L. 1973, ch. 85, § 70; L. 1993, ch. 200, § 13; L. 2024, ch. 6, § 89; January 1, 2025.
The administrator and the commissioner of insurance are authorized and directed to consult and assist one another in maintaining compliance with this article. They may jointly pursue investigations, prosecute suits, and take other official action, as may seem to them appropriate, if either of them is otherwise empowered to take the action. If the administrator is informed of a violation or suspected violation by an insurer of this article, or of the insurance laws, rules, and regulations of this state, the administrator shall advise the commissioner of insurance of the circumstances.
History: L. 1973, ch. 85, § 71; L. 2024, ch. 6, § 90; January 1, 2025.
(1) To the extent that the commissioner's responsibility under this article requires, the commissioner of insurance shall adopt rules and regulations pursuant to this act regarding insurers, refunds, forms, schedules of premium rates and charges, the commissioner's approval or disapproval of such rules and regulations adopted and, in case of violation, may make an order for compliance.
(2) Each provision on administrative procedures and judicial review of the article on administration that applies to and governs administrative action taken by the administrator also applies to and governs all administrative action taken by the commissioner of insurance pursuant to this section.
History: L. 1973, ch. 85, § 72; L. 1999, ch. 107, § 25; L. 2024, ch. 6, § 91; January 1, 2025.
(1) Consumer credit insurance provided by a creditor may be subject to the furnishing of evidence of insurability satisfactory to the insurer. Whether or not such evidence is required, the term of the insurance shall commence no later than when the consumer becomes obligated to the creditor or when the consumer applies for the insurance, whichever is later, except as follows:
(a) If any required evidence of insurability is not furnished until more than 30 days after the term would otherwise commence, the term may commence on the date when the insurer determines the evidence to be satisfactory; or
(b) if the creditor provides insurance not previously provided covering debts previously created, the term may commence on the effective date of the policy.
(2) The originally scheduled term of the insurance shall extend at least until the due date of the last scheduled payment of the debt except as follows:
(a) If the insurance relates to an open-end credit account, the term need extend only until the payment of the debt under the account and may be sooner terminated after at least 30 days' notice to the consumer; or
(b) if the consumer is advised in writing that the insurance will be written for a specified shorter time, the term need extend only until the end of the specified time.
(3) The term of the insurance shall not extend more than 15 days after the originally scheduled due date of the last scheduled payment of the debt unless it is extended without additional cost to the consumer or as an incident to a deferral, refinancing or consolidation.
History: L. 1973, ch. 85, § 73; L. 2024, ch. 6, § 92; January 1, 2025.
(1) Except as provided in subsection (2):
(a) In the case of consumer credit insurance providing life coverage, the amount of insurance may not initially exceed the debt and, if the debt is payable in installments, may not at any time exceed the greater of the scheduled or actual amount of the debt; or
(b) in the case of any other consumer credit insurance, the total amount of periodic benefits payable may not exceed the total of scheduled unpaid installments of the debt, and the amount of any periodic benefit may not exceed the original amount of debt divided by the number of periodic installments in which it is payable.
(2) If consumer credit insurance is provided in connection with an open-end credit account, the amounts payable as insurance benefits may be reasonably commensurate with the amount of debt as it exists from time to time. If consumer credit insurance is provided in connection with a commitment to grant credit in the future, the amounts payable as insurance benefits may be reasonably commensurate with the total from time to time of the amount of debt and the amount of the commitment.
History: L. 1973, ch. 85, § 74; L. 1988, ch. 85, § 9; L. 2024, ch. 6, § 93; January 1, 2025.
(1) A creditor may not use a form or a schedule of premium rates or charges, the filing of which is required by this section, if the commissioner of insurance has disapproved the form or schedule and has notified the insurer of such disapproval. A creditor may not use a form or schedule unless:
(a) The form or schedule has been on file with the commissioner of insurance for 30 days, or was approved by the commissioner prior to such creditor's use; and
(b) the insurer has complied with this section with respect to the insurance.
(2) Except as provided in subsection (3), all policies, certificates of insurance, notices of proposed insurance, applications for insurance, endorsements and riders relating to consumer credit insurance delivered or issued for delivery in this state, and the schedules of premium rates or charges pertaining thereto, shall be filed by the insurer with the commissioner of insurance. Within 30 days after the filing of any form or schedule, the commissioner shall disapprove it if the premium rates or charges are unreasonable in relation to the benefits provided under the form, or if the form contains provisions that are unjust, unfair, inequitable or deceptive, or encourage misrepresentation of the coverage, or are contrary to any provision of the insurance code or of any rule or regulation promulgated thereunder.
(3) If a group policy has been delivered in another state, the forms to be filed by the insurer with the commissioner of insurance are the group certificates and notices of proposed insurance. The commissioner shall approve them if:
(a) Such group certificates and notices of proposed insurance provide the information that would be required if the group policy were delivered in this state; and
(b) the applicable premium rates or charges do not exceed those established by his rules or regulations.
History: L. 1973, ch. 85, § 75; L. 2024, ch. 6, § 94; January 1, 2025.
(1) A creditor may not contract for or receive a separate charge for insurance against loss of or damage to property unless:
(a) The insurance covers a substantial risk of loss of or damage to property related to the credit transaction;
(b) the amount, terms, and conditions of the insurance are reasonable in relation to the character and value of the property insured or to be insured; and
(c) the term of the insurance is reasonable in relation to the terms of credit.
(2) The term of the insurance is reasonable if it is customary and does not extend substantially beyond a scheduled maturity.
(3) A creditor may not contract for or receive a separate charge for insurance against loss of or damage to property unless property is purchased pursuant to a credit card or in a transaction pursuant to open-end credit, or unless the amount financed exclusive of charges for the insurance is $900 or more, and the value of the property is $900 or more.
History: L. 1973, ch. 85, § 76; L. 1999, ch. 107, § 24; L. 2024, ch. 6, § 95; January 1, 2025.
If a creditor contracts for or receives a separate charge for insurance against loss of or damage to property, the risk of loss or damage not willfully caused by the consumer is on the consumer only to the extent of any deficiency in the effective coverage of the insurance, even though the insurance covers only the interest of the creditor.
History: L. 1973, ch. 85, § 77; January 1, 1974.
A creditor may not contract for or receive a separate charge for insurance against liability unless the insurance covers a substantial risk of liability arising out of the ownership or use of property related to the credit transaction.
History: L. 1973, ch. 85, § 78; January 1, 1974.
A creditor shall not request cancellation of a policy of property or liability insurance except after the consumer's default or in accordance with a written authorization by the consumer, and in either case the cancellation shall not take effect until written notice is delivered to the consumer or mailed to such consumer at the address provided. The notice shall state that the policy may be cancelled on a date not less than 10 days after the notice is delivered, or, if the notice is mailed, not less than 13 days after it is mailed.
History: L. 1973, ch. 85, § 79; L. 2024, ch. 6, § 96; January 1, 2025.
History: L. 1973, ch. 85, § 80; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
History: L. 1973, ch. 85, § 81; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
(1) This section applies to a deficiency on a consumer credit sale of goods or services and on a consumer loan in which the lender is subject to defenses arising from sales; a consumer is not liable for a deficiency unless the creditor has disposed of the goods in good faith and in a commercially reasonable manner.
(2) If the seller repossesses or voluntarily accepts surrender of goods which were the subject of the sale and in which the seller has a security interest, the buyer is not personally liable to the seller for the unpaid balance of the debt arising from the sale of a commercial unit of goods of which the cash sale price was $1,000 or less, and the seller is not obligated to resell the collateral unless the buyer has paid 60% or more of the cash price and has not signed after default a statement renouncing such buyer's rights in the collateral.
(3) If the seller repossesses or voluntarily accepts surrender of goods which were not the subject of the sale but in which the seller has a security interest to secure a debt arising from a sale of goods or services or a combined sale of goods and services and the cash price of the sale was $1,000 or less, the buyer is not personally liable to the seller for the unpaid balance of the debt arising from the sale, and the seller's duty to dispose of the collateral is governed by K.S.A. 84-9-610, and amendments thereto.
(4) If the lender takes possession or voluntarily accepts surrender of goods in which such lender has a security interest to secure a debt arising from a consumer loan in which the lender is subject to defenses arising from sales K.S.A. 16a-3-405, and amendments thereto, and the net proceeds of the loan paid to or for the benefit of the debtor were $1,000 or less, the debtor is not personally liable to the lender for the unpaid balance of the debt arising from the loan and the lender's duty to dispose of the collateral is governed byK.S.A. 84-9-610, and amendments thereto.
(5) For the purpose of determining the unpaid balance of consolidated debts or debts pursuant to open-end credit, the allocation of payments to a debt shall be determined in the same manner as provided by K.S.A. 16a-3-303, and amendments thereto.
(6) The consumer may be liable in damages to the creditor if the consumer has wrongfully damaged the collateral or if, after default and demand, the consumer has wrongfully failed to make the collateral available to the creditor.
(7) If the creditor brings an action against the consumer for a debt arising from a consumer credit sale of goods or services or from a consumer loan in which the lender is subject to defenses arising from sales, when under this section the creditor would not be entitled to a deficiency judgment if the creditor took possession of the collateral, and obtains judgment:
(a) The creditor may not take possession of the collateral, and
(b) the collateral is not subject to levy or sale on execution or similar proceedings pursuant to the judgment.
History: L. 1973, ch. 85, § 82; L. 2005, ch. 144, § 16; L. 2024, ch. 6, § 97; January 1, 2025.
Revisor's Note: Sections 5-104 through 5-106 of the uniform consumer credit code were not enacted in Kansas.
(1) If it is the understanding of the creditor and the consumer that delay in making repayment or failure to make repayment could result in the use of violence or other criminal means to cause harm to the person, reputation or property of any person, the repayment of the extension of credit is unenforceable through civil judicial processes against the consumer.
(2) If an extension of credit was made at an annual rate exceeding 36% calculated according to the actuarial method and that the creditor then had a reputation for the use or threat of use of violence or other criminal means to cause harm to the person, reputation or property of any person to collect extensions of credit or to punish the nonrepayment thereof, there is prima facie evidence that the extension of credit was unenforceable under subsection (1).
History: L. 1973, ch. 85, § 83; L. 2024, ch. 6, § 98; January 1, 2025.
(1) The unconscionability of an act or practice is a question for the trier of fact.
(2) With respect to a consumer credit transaction, if the trier of fact finds:
(a) The agreement was unconscionable at the time it was made, or was induced by unconscionable conduct, the court may refuse to enforce the agreement; or
(b) any clause of the agreement was unconscionable at the time it was made, the court may refuse to enforce the agreement, may enforce the remainder of the agreement without the unconscionable clause or may so limit the application of any unconscionable clause as to avoid any unconscionable result.
(3) If it is claimed or appears to the trier of fact that the agreement or any clause thereof may be unconscionable the parties shall be afforded a reasonable opportunity to present evidence as to its setting, purpose, and effect to aid the court in making the determination.
(4) A charge or practice expressly permitted by this act shall not be unconscionable.
History: L. 1973, ch. 85, § 84; L. 2024, ch. 6, § 99; January 1, 2025.
An agreement of the parties to a consumer credit transaction with respect to default on the part of the consumer is enforceable only to the extent that:
(1) The consumer fails to make a payment as required by agreement; or
(2) the prospect of payment, performance, or realization of collateral is significantly impaired; the burden of establishing the prospect of significant impairment is on the creditor.
History: L. 1973, ch. 85, § 85; January 1, 1974.
History: L. 1973, ch. 85, § 86; L. 1974, ch. 91, § 2; L. 1994, ch. 276, § 2; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
(1) After a consumer has been in default for 10 days for failure to make a required payment in a consumer credit transaction payable in installments, a creditor may give the consumer the notice described in this section. A creditor gives notice to the consumer under this section when the creditor delivers the notice to the consumer or delivers or mails the notice to the address of the consumer's residence.
(2) The notice shall be in writing and shall conspicuously state the following: The name, address and telephone number of the creditor to which payment is to be made, a brief description of the credit transaction, the consumer's right to cure the default, the amount of payment and date by which payment must be made to cure the default, and the consumer's possible liability for the reasonable costs of collection, including, but not limited to, court costs, either attorney fees or collection agency fees and any other information required by the administrator as set forth by rules and regulations or by administrative interpretation.
(3) With respect to a consumer credit transaction payable in installments, after a default consisting only of the consumer's failure to make a required payment, a creditor may neither accelerate maturity of the unpaid balance of the obligation nor take possession of collateral because of that default until 20 days after a notice of the consumer's right to cure is given. Until 20 days after the notice is given, the consumer may cure all defaults consisting of a failure to make the required payment by tendering the amount of all unpaid sums due at the time of the tender, without acceleration, plus any unpaid late fees. Cure shall restore the consumer to the consumer's rights under the agreement as though the defaults had not occurred.
(4) With respect to defaults on the same obligation after a creditor has once given a notice of consumer's right to cure, this section gives the consumer no right to cure and imposes no limitation on the creditor's right to proceed against the consumer or the collateral.
(5) Unless the consumer voluntarily surrenders the collateral to the creditor, the creditor may take possession of the collateral without judicial process only if possession can be taken without entry into a dwelling and without the use of force or other breach of the peace.
(6) Nothing in this section shall prohibit a consumer from voluntarily surrendering the collateral of the consumer credit transaction and shall not prohibit the creditor from thereafter enforcing the creditor's security interest in the collateral at any time after surrender.
History: L. 1973, ch. 85, § 87; L. 1974, ch. 91, § 3; L. 2005, ch. 144, § 17; L. 2024, ch. 6, § 100; January 1, 2025.
History: L. 1973, ch. 85, § 88; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
(1) If a creditor has violated the provisions of this act applying to collection of excess charges or enforcement of rights, restrictions on interests in land as security, limitations on the schedule of payments or loan terms for supervised loans, attorney's fees, security in sales and leases, assignments of earnings, authorizations to confess judgment, certain negotiable instruments prohibited, assignees subject to defenses, credit card issuer subject to defenses, or limitations on default charges, the consumer may recover actual damages and except for a class action a penalty in an amount determined by the court not less than $100 nor more than $1,000. With respect to violations arising from sales or loans made pursuant to open-end credit, no action pursuant to this subsection may be brought more than two years after the violations occurred. With respect to violations arising from other consumer transactions, no action pursuant to this subsection may be brought more than one year after the due date of the last scheduled payment of the agreement.
(2) If a creditor has violated the provisions of this act applying to authority to make supervised loans, the loan is void and the consumer is not obligated to pay either the amount financed or finance charge. If the consumer has paid any part of the amount financed or finance charge, the consumer has a right to recover the payment from the person violating this act or from an assignee of that person's rights who undertakes direct or indirect collection of payments or enforcement of rights arising from the debt including, but not limited to, loans described in K.S.A. 16a-2-301(1), and amendments thereto. With respect to violations arising from loans made pursuant to open-end credit, no action pursuant to this subsection may be brought more than two years after the violation occurred. With respect to violations arising from other loans, no action pursuant to this subsection may be brought more than one year after the due date of the last scheduled payment of the agreement pursuant to which the charge was paid. Persons subject to the penalties in this subsection shall not include attorneys or collection agencies that do not purchase a consumer obligation.
(3) A consumer is not obligated to pay a charge in excess of that allowed by this act, and if the consumer has paid an excess charge the consumer has a right to a refund of twice the excess charge. If the consumer has paid an amount in excess of the lawful obligation under the agreement, the consumer may recover twice the excess amount from the person who made the excess charge or from an assignee of that person's rights who undertakes direct or indirect collection of payments from or enforcement of rights against debtors arising from the debt including, but not limited to, loans described in K.S.A. 16a-2-301(1), and amendments thereto. Persons subject to the penalties in this subsection shall not include attorneys or collection agencies who do not purchase a consumer obligation.
(4) If a creditor has contracted for or received a charge in excess of that allowed by this act, or if a consumer is entitled to a refund and a person liable to the consumer refuses to make a refund within a reasonable time after demand, the consumer may recover from the creditor or the person liable in an action except for a class action a penalty in an amount determined by the court not less than $100 or more than $1,000. With respect to excess charges arising from sales or loans made pursuant to open-end credit, no action pursuant to this subsection may be brought more than two years after the time the excess charge was made. With respect to excess charges arising from other consumer credit transactions, no action pursuant to this subsection may be brought more than one year after the due date of the last scheduled payment of the agreement pursuant to which the charge was made. Persons subject to the penalties in this subsection shall not include attorneys or collection agencies who do not purchase a consumer obligation.
(5) Except as otherwise provided, no violation of the provisions of K.S.A. 16a-1-101 et seq., and amendments thereto, impairs rights on a debt.
(6) A creditor has no liability for a penalty under subsection (1) or subsection (4) if within 15 days after discovering an error, and prior to the institution of an action under this section or the receipt of written notice of the error, the creditor notifies the person concerned of the error and corrects the error. If the violation consists of a prohibited agreement, giving the consumer a corrected copy of the writing containing the error is sufficient notification and correction. If the violation consists of an excess charge, correction shall be made by an adjustment or refund.
(7) If the creditor establishes by a preponderance of evidence that a violation is unintentional or the result of a bona fide error of law or fact notwithstanding the maintenance of procedures reasonably adapted to avoid any such violation or error, no liability is imposed under subsections (1), (2), and (3), the validity of the transaction is not affected, and no liability is imposed under subsection (4) except for refusal to make a refund.
(8) In an action in which it is found that a creditor has violated any provision of K.S.A. 16a-1-101 et seq., and amendments thereto, the court shall award to the consumer the costs of the action and to the consumer's attorneys their reasonable fees. Reasonable attorney's fees shall be determined by the value of the time expended by the attorney and not by the amount of the recovery on behalf of the consumer.
(9) A creditor who in good faith complies with a written administrative interpretation shall not be subject to any penalties under this section for any act done or omitted in conformity with such written administrative interpretation.
History: L. 1973, ch. 85, § 89; L. 1992, ch. 80, § 2; L. 2024, ch. 6, § 101; January 1, 2025.
Refunds or penalties to which the consumer is entitled pursuant to this part may be set off against the consumer's obligation, and may be raised as a defense to a suit on the obligation without regard to the time limitations prescribed by this part.
History: L. 1973, ch. 85, § 90; January 1, 1974.
(1) Except as otherwise provided in this section, a creditor who fails to disclose information to a person entitled to the information under the provisions of K.S.A. 16a-1-101 et seq., and amendments thereto, or under rules and regulations adopted by the administrator is liable to that person in an amount equal to the sum of:
(a) Twice the amount of the finance charge in connection with the transaction, but the liability pursuant to this paragraph shall be not less than $200 or more than $2,000; and
(b) in the case of a successful action to enforce the liability under paragraph (a), the costs of the action together with reasonable attorney's fees as determined by the court.
(2) A creditor has no liability under this section if within 15 days after discovering an error, and prior to the institution of an action under this section or the receipt of written notice of the error, the creditor notifies the person concerned of the error and makes whatever adjustments in the appropriate account are necessary to assure that the person will not be required to pay a credit service charge or loan finance charge in excess of the amount or percentage rate actually disclosed.
(3) A creditor may not be held liable in any action brought under this section for a violation of the provisions of K.S.A. 16a-1-101 et seq., and amendments thereto, if the creditor shows by a preponderance of evidence that the violation was not intentional and resulted from a bona fide error notwithstanding the maintenance of procedures reasonably adapted to avoid the error.
(4) Any action which may be brought under this section against the original creditor in any credit transaction involving a security interest in land may be maintained against any subsequent assignee of the original creditor where the assignee, its subsidiaries, or affiliates were in a continuing business relationship with the original creditor either at the time the credit was extended or at the time of the assignment, unless the assignment was involuntary or the assignee shows by a preponderance of evidence that it did not have reasonable grounds to believe that the original creditor was engaged in violations of this act and that it maintained procedures reasonably adapted to apprise it of the existence of the violations.
(5) No action pursuant to this section may be brought more than one year after the date of the occurrence of the violation.
(6) The liability of the creditor under this section is in lieu of and not in addition to the creditor's liability under the federal truth in lending act.
History: L. 1973, ch. 85, § 91; L. 1981, ch. 93, § 15; L. 1988, ch. 85, § 10; L. 1999, ch. 107, § 26; L. 2024, ch. 6, § 102; January 1, 2025.
(1) It is unlawful for any person to violate any of the provisions of this act, any rule and regulation adopted or order issued under this act. A conviction for an intentional violation is a class A nonperson misdemeanor. A second or subsequent conviction of this subsection is severity level 7 nonperson felony.
(2) The criminal liability of a person under this section is in lieu of and not in addition to the creditor's criminal liability under the federal truth in lending act.
(3) A person, other than a supervised financial organization or an attorney or collection agency who does not purchase the credit obligation, who willfully engages in the business of entering into consumer credit transactions, or of taking assignments of rights against consumers arising therefrom and undertakes direct or indirect collection of payments or enforcement of these rights, without complying with the provisions of this act concerning notification or payment of fees is guilty of a class A misdemeanor and upon conviction thereof shall be punished in the manner provided by law.
History: L. 1973, ch. 85, § 92; L. 1999, ch. 107, § 27; L. 2024, ch. 6, § 103; January 1, 2025.
History: L. 1973, ch. 85, § 93; L. 1981, ch. 93, § 16; Repealed, L. 1999, ch. 107, § 34; July 1.
History: L. 1973, ch. 85, § 94; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
History: L. 1973, ch. 85, § 95; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
History: L. 1973, ch. 85, § 96; Repealed, L. 1988, ch. 85, § 13; July 1.
(1) In addition to other powers granted by this act, the administrator may:
(a) Receive and act on complaints, take action designed to obtain voluntary compliance with the provisions of K.S.A. 16a-1-101 et seq., and amendments thereto, or commence proceedings on the administrator's own initiative;
(b) provide guidance to persons and groups on their rights and duties under K.S.A. 16a-1-101 et seq., and amendments thereto;
(c) establish or support programs for the education of consumers with respect to credit practices:
(A) As a condition in settlements of investigations or examinations, the administrator may require a payment designated for consumer education to be expended as directed by the administrator for such purpose; and
(B) the administrator may fund consumer education programs from operating funds in an amount up to 1% of operating funds;
(d) make studies appropriate to effectuate the purposes and policies of K.S.A. 16a-1-101 et seq., and amendments thereto;
(e) adopt, amend and revoke rules and regulations to carry out the specific provisions of K.S.A. 16a-1-101 et seq., and amendments thereto;
(f) issue, amend and revoke written administrative interpretations;
(g) maintain offices within this state;
(h) appoint employees and agents and set such employees' compensation, and authorize attorneys appointed under this section to appear for and represent the administrator in court;
(i) examine periodically at intervals the administrator deems appropriate the loans, business and records of every licensee or consumer credit filer, except licensees that are supervised financial organizations. The official or agency responsible for the supervision of each supervised financial organization shall examine the loans, business and records of each such organization in the manner and periodically at intervals prescribed by the administrator. In addition, for the purpose of discovering violations of K.S.A. 16a-1-101 et seq., and amendments thereto, or securing information lawfully required, the administrator or the official or agency to whose supervision the organization is subject to K.S.A. 16a-6-105, and amendments thereto, may at any time investigate the loans, business and records of any supervised lender. For examination purposes the administrator shall have free and reasonable access to the offices, places of business and records of the licensee or consumer credit filer and the administrator may control access to any documents and records of a licensee or consumer credit filer;
(j) refer such evidence as may be available concerning violations of this act or of any rule and regulation or order to the attorney general or in consultation with the attorney general to the proper county or district attorney, who may in the prosecutor's discretion, with or without such a referral, institute the appropriate criminal proceedings under the laws of this state;
(k) if deemed necessary by the administrator, require fingerprinting of any applicant in accordance with K.S.A. 2025 Supp. 22-4714, and amendments thereto. For purposes of this section and in order to reduce the points of contact which the federal bureau of investigation may have to maintain with the individual states, the administrator may use the nationwide mortgage licensing system and registry as a channeling agent for requesting information from and distributing information to the department of justice or any governmental agency. As used in this paragraph, "applicant" means a licensee, a member of a licensee if such licensee is a copartnership or association, an officer or director if such licensee is a corporation or an agent or other person acting on behalf of a licensee;
(l) exchange information regarding the administration of this act with any agency of the United States or any state which regulates the licensee or consumer credit filer who administers statutes, rules and regulations or other programs related to consumer credit and to enter into information sharing arrangements with other governmental agencies or associations representing governmental agencies which are deemed necessary or beneficial to the administration of this act;
(m) use the nationwide mortgage licensing system and registry as a channeling agent for requesting and distributing any information regarding supervised lender licensing to and from any source so directed by the administrator;
(n) establish relationships or contracts with the nationwide mortgage licensing system and registry or other entities to collect and maintain records and process transaction fees or other fees related to applicants, licensees or other persons subject to the act and to take such other actions as may be reasonably necessary to participate in the nationwide mortgage licensing system and registry. The administrator shall regularly report violations of law, enforcement actions and other relevant information, to the nationwide mortgage licensing system and registry; and
(o) require any licensee to file reports with the nationwide mortgage licensing system and registry in the form prescribed by the administrator or the administrator's designee.
(2) The administrator shall enforce the provisions of this act and the rules and regulations and interpretations adopted thereunder with respect to a creditor, unless the creditor's compliance is regulated exclusively or primarily by another state or federal agency.
(3) To keep the administrator's rules and regulations in harmony with the rules of administrators in other jurisdictions, the administrator, so far as is consistent with the purposes, policies and provisions of K.S.A. 16a-1-101 et seq., and amendments thereto, may:
(a) Before adopting, amending and revoking rules and regulations, advise and consult with administrators in other jurisdictions; and
(b) in adopting, amending and revoking rules and regulations, take into consideration the rules of administrators in other jurisdictions.
(4) Except for refund of an excess charge, no liability is imposed under K.S.A. 16a-1-101 et seq., and amendments thereto, for an act done or omitted in conformity with a rule and regulation or written administrative interpretation of the administrator in effect at the time of the act or omission notwithstanding that after the act or omission the rule and regulation or written administrative interpretation may be determined by judicial or other authority to be invalid for any reason.
(5) The administrator prior to December 1 of each year shall establish such fees as are authorized under the provisions of K.S.A. 16a-1-101 et seq., and amendments thereto, for the ensuing calendar year in such amounts as the administrator may determine to be sufficient to meet the budget requirements of the administrator for each fiscal year.
History: L. 1973, ch. 85, § 97; L. 1976, ch. 98, § 2; L. 1981, ch. 93, § 17; L. 1992, ch. 80, § 3; L. 1999, ch. 107, § 28; L. 2005, ch. 144, § 18; L. 2009, ch. 29, § 21; L. 2024, ch. 15, § 22; L. 2024, ch. 100, § 3; January 1, 2025.
(1) With respect to supervised financial organizations, the powers of examination and investigation and administrative enforcement shall be exercised by the official or agency to whose supervision the organization is subject. Should a supervised financial organization become licensed hereunder, a report of that portion of each examination made by the supervisory official or agency of such organization relating to compliance with the provisions of chapter 16a of the Kansas Statutes Annotated, and amendments thereto, shall be filed with the administrator. All other powers of the administrator under this act may be exercised by the administrator with respect to a supervised financial organization except that compliance with truth in lending shall be governed as set forth in K.S.A. 16a-6-104(2), and amendments thereto.
(2) If the administrator receives a complaint or other information concerning noncompliance with this act by a supervised financial organization, the administrator shall inform the official or agency having supervisory authority over the organization concerned. The administrator may request information about supervised financial organizations from the officials or agencies supervising them. If such officials or agencies have cause to believe the license of any supervised financial organization subject to their supervision is subject to suspension or revocation for any reason stated in K.S.A. 16a-2-303, and amendments thereto, such official or agency shall notify the administrator and assist the administrator in the enforcement of this act.
(3) The administrator and any official or agency of this state having supervisory authority over a supervised financial organization are authorized and directed to consult and assist one another in maintaining compliance with the provisions of K.S.A. 16a-1-101 et seq., and amendments thereto. They may jointly pursue investigations, prosecute suits, and take other official action, as they deem appropriate, if either of them otherwise is empowered to take the action.
History: L. 1973, ch. 85, § 98; L. 1980, ch. 76, § 10; L. 1992, ch. 46, § 3; L. 1999, ch. 107, § 29; L. 2024, ch. 6, § 105; January 1, 2025.
(1) The administrator may:
(a) Conduct examinations or investigations within or outside of this state as necessary to determine whether any license should be granted, denied or revoked or whether any person has violated or is about to violate any provision of this act or any rule and regulation, administrative interpretation, or order hereunder or to aid in the enforcement of this act or in the prescribing of forms or adoption of rules and regulations; and
(b) require or permit any person to file a statement in writing, under oath or otherwise as the administrator determines, of all the facts and circumstances concerning any violation of this act or any rule and regulation, administrative interpretation or order hereunder.
(2) All examination material shall be confidential by law and privileged and shall not be subject to the open records act, subpoena and discovery or admissible in evidence in any private civil action. The provisions of this subsection providing for the confidentiality of public records shall expire on July 1, 2030, unless the legislature reviews and reenacts such provisions in accordance with K.S.A. 45-229, and amendments thereto, prior to July 1, 2030.
(3) For the purpose of any examination, investigation or proceeding under this act, the administrator or any officer designated by the administrator may administer oaths and affirmations, subpoena witnesses, compel such witnesses' attendance, adduce evidence and require the production of any matter which is relevant to the examination or investigation, including the existence, description, nature, custody, condition and location of any books, documents or other tangible things and the identity and location of persons having knowledge of relevant facts, or any other matter reasonably calculated to lead to the discovery of relevant information or items.
(4) In case of contumacy by, or refusal to obey a subpoena issued to any person, any court of competent jurisdiction, upon application by the administrator, may issue to that person an order requiring the person to appear before the administrator, or the officer designated by the administrator, there, to produce documentary evidence if so ordered or to give evidence touching the matter under investigation or in question. Any failure to obey the order of the court may be punished by the court as a contempt of court.
(5) No person is excused from attending and testifying or from producing any document or record before the administrator or in obedience to the subpoena of the administrator or any officer designated by the the* administrator or in any proceeding instituted by the administrator.
(6) The administrator may issue and apply to enforce subpoenas in this state at the request of another state if the activities constituting an alleged violation for which the information is sought would be a violation of the uniform consumer credit code if the activities had occurred in this state.
(7) If the person's records are located outside this state, the person shall either make them available to the administrator at a convenient location within this state or, at the administrator's discretion, pay the reasonable and necessary expenses for the administrator or such administrator's representative to examine them at the place where they are maintained. The administrator may designate representatives, including comparable officials of the state in which the records are located, to inspect the records on the administrator's behalf.
(8) The administrator may charge as costs of investigation or examination all reasonable expenses, including a per diem and actual travel and lodging expenses to be paid by the party or parties under investigation or examination. The administrator may maintain an action in any court to recover such costs.
(9) The administrator may enter into an informal agreement at any time with a person to resolve a matter arising under this act, rules and regulations adopted pursuant thereto or an order issued pursuant to this act. The adoption of an informal agreement authorized by this subsection shall not be subject to the provisions of K.S.A. 77-501 et seq. or 77-601 et seq., and amendments thereto. Any informal agreement authorized by this subsection shall not be considered an order or other agency action and shall be considered confidential examination material.
History: L. 1973, ch. 85, § 99; L. 1999, ch. 107, § 30; L. 2024, ch. 6, § 106; January 1, 2025.
History: L. 1973, ch. 85, § 100; Repealed, L. 1999, ch. 107, § 34; July 1.
(1) If the administrator determines after notice and opportunity for a hearing that any person has engaged, is engaging or is about to engage in any act or practice constituting a violation of any provision of this act or any rule and regulation, order or administrative interpretation hereunder, including, but not limited to, refusal or failure to provide information requested by the administrator, the administrator by order may require that such person cease and desist from the unlawful act or practice and take such affirmative action as in the judgment of the administrator will carry out the purposes of this act.
(2) If the administrator makes written findings of fact that the public interest will be irreparably harmed by delay in issuing an order under subsection (1), the administrator may issue an emergency cease and desist order. Such order shall be subject to the same procedures as an emergency order issued under K.S.A. 77-536, and amendments thereto. Upon the entry of such an order the administrator shall promptly notify the person subject to the order that it has been entered, of the reasons and that upon written request the matter will be set for a hearing which shall be conducted in accordance with the provisions of the Kansas administrative procedure act. If no hearing is requested and none is ordered by the administrator, the order will remain in effect until it is modified or vacated by the administrator. If a hearing is requested or ordered, the administrator, after notice of and opportunity for hearing to the person subject to the order, shall by written findings of fact and conclusion of law vacate, modify or make permanent the order.
(3) If the administrator reasonably believes that a person has violated this act or a rule and regulation, order or administrative interpretation of the administrator under this act, the administrator, in addition to any specific power granted under this act, after notice and hearing in an administrative proceeding, unless the right to notice and hearing is waived by the person against whom the sanction is imposed, may require any or all of the following:
(a) Censure the person if the person is licensed under this act;
(b) issue an order against an applicant, supervised loan licensee, consumer credit filer or other person who knowingly violates this act or a rule and regulation, order or administrative interpretation of the administrator under this act, including, but not limited to, refusal or failure to provide information requested by the administrator, imposing a civil penalty up to a maximum of $5,000 for each violation. If any person is found to have knowingly or willfully violated any provision of this act, and such violation is committed against elder or disabled persons, as defined in K.S.A. 50-676, and amendments thereto, in addition to any civil penalty otherwise provided by law, the administrator may impose an additional penalty not to exceed $5,000 for each such violation;
(c) revoke or suspend the person's license or registration or bar the person from subsequently applying for a license or registration under this act; or
(d) issue an order requiring the person to pay restitution for any loss arising from the violation or requiring the person to disgorge any profits arising from the violation. Such order may include the assessment of interest not to exceed 8% per annum from the date of the violation.
(4) Any person aggrieved by a final order of the administrator may obtain a review of the order in accordance with the provisions of the Kansas judicial review act.
History: L. 1973, ch. 85, § 101; L. 1986, ch. 318, § 21; L. 1999, ch. 107, § 31; L. 2005, ch. 144, § 19; L. 2009, ch. 29, § 22; L. 2010, ch. 17, § 36; L. 2024, ch. 6, § 107; January 1, 2025.
If it is claimed that a person has engaged in conduct subject to an order by the administrator or by a court, the administrator may accept an assurance in writing that the person will not engage in the conduct in the future. Failure to abide by the assurance of discontinuance shall be evidence that the person engaged in the prior conduct described in the assurance.
History: L. 1973, ch. 85, § 102; L. 2024, ch. 6, § 108; January 1, 2025.
The administrator may bring a civil action to restrain a person from violating the provisions of K.S.A. 16a-1-101 et seq., and amendments thereto, or any rules or regulations adopted thereunder and for other appropriate relief.
History: L. 1973, ch. 85, § 103; L. 2024, ch. 6, § 109; January 1, 2025.
(1) The administrator may bring a civil action to restrain a creditor or a person acting on such creditor's or person's behalf from engaging in a course of:
(a) Making or enforcing unconscionable terms or provisions of consumer credit transactions; or
(b) fraudulent or unconscionable conduct in inducing consumers to enter into consumer credit transactions.
(2) In an action brought pursuant to this section the court may grant relief only if the trier of the fact finds that the:
(a) Respondent has made unconscionable agreements or has engaged or is likely to engage in a course of fraudulent or unconscionable conduct;
(b) agreements or conduct of the respondent has caused or is likely to cause injury to consumers; and
(c) respondent has been able to cause or will be able to cause the injury primarily because the transactions involved are credit transactions.
(3) In applying this section, consideration shall be given to each of the following factors, among others:
(a) Belief by the creditor at the time consumer credit transactions are entered into that there was no reasonable probability of payment in full of the obligation by the consumer;
(b) in the case of consumer credit sales or consumer leases, knowledge by the seller or lessor at the time of the sale or lease of the inability of the buyer or lessee to receive substantial benefits from the property or services sold or leased;
(c) in the case of consumer credit sales or consumer leases, gross disparity between the price of the property or services sold or leased and the value of the property or services measured by the price at which similar property or services are readily obtainable in credit transactions by like buyers or lessees;
(d) the fact that the creditor contracted for or received separate charges for insurance with respect to consumer credit sales or consumer loans with the effect of making the sales or loans, considered as a whole, unconscionable; and
(e) the fact that the respondent has knowingly taken advantage of the inability of the consumer reasonably to protect such consumer's interests by reason of physical or mental infirmities, ignorance, illiteracy, inability to understand the language of the agreement or similar factors.
(4) In an action brought pursuant to this section, a charge or practice expressly permitted by this act is not in itself unconscionable.
History: L. 1973, ch. 85, § 104; L. 2024, ch. 6, § 110; January 1, 2025.
With respect to an action brought to enjoin violations of K.S.A. 16a-1-101 et seq., and amendments thereto, or unconscionable agreements or fraudulent or unconscionable conduct, the administrator may petition the court for appropriate temporary relief against a respondent, pending final determination of proceedings. If the court finds after a hearing held upon notice to the respondent that there is reasonable cause to believe that the respondent is engaging in or is likely to engage in conduct sought to be restrained, it may grant any temporary relief or restraining order it deems appropriate.
History: L. 1973, ch. 85, § 105; L. 2024, ch. 6, § 111; January 1, 2025.
(1) After demand, the administrator may bring a civil action against a creditor for all amounts of money, other than penalties, which a consumer or class of consumers has a right to recover explicitly granted by the provisions of K.S.A. 16a-1-101 et seq., and amendments thereto. The court shall order amounts recovered or recoverable under this subsection paid to each consumer or set off against such consumer's obligation. A consumer's action, other than a class action, takes precedence over a prior or subsequent action by the administrator with respect to the claim of that consumer. A consumer's class action takes precedence over a subsequent action by the administrator with respect to claims common to both actions but intervention by the administrator is authorized. An administrator's action on behalf of a class of consumers takes precedence over a consumer's subsequent class action with respect to claims common to both actions. When an action takes precedence over another action under this subsection, the other action may be stayed while the preceding action is pending and dismissed if the preceding action is dismissed with prejudice or results in a final judgment granting or denying the claim asserted in the preceding action.
(2) The administrator may bring a civil action against a creditor or a person acting on such creditor's or person's behalf to recover a civil penalty for willfully violating this act, and if the court finds that the defendant has engaged in a course of repeated and willful violations of this act, it may assess a civil penalty of no more than $5,000 per violation. Any civil action under this subsection shall be brought within two years following the violation.
History: L. 1973, ch. 85, § 106; L. 2024, ch. 6, § 112; January 1, 2025.
Revisor's Note: Section 6-114 of the uniform consumer credit code was not enacted in Kansas.
The grant of powers to the administrator in this article does not affect remedies available to consumers under K.S.A. 16a-1-101 et seq., and amendments thereto, or under other principles of law or equity.
History: L. 1973, ch. 85, § 107; L. 2024, ch. 6, § 113; January 1, 2025.
The administrator may bring actions or proceedings in a court in a county in which an act on which the action or proceeding is based occurred or in a county in which respondent resides or transacts business.
History: L. 1973, ch. 85, § 108; January 1, 1974.
History: L. 1981, ch. 93, § 1; L. 1992, ch. 46, § 4; L. 1999, ch. 107, § 32; L. 2000, ch. 27, § 4; L. 2009, ch. 29, § 23; L. 2009, ch. 143, § 6; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
(1) This part applies to any creditor engaged in this state in entering into consumer credit transactions and to any person who accepts assignments of and undertakes collection of payments from or assignments of and enforces rights against debtors arising from these transactions.
(2) This subsection shall not apply to:
(a) Supervised financial organizations; or
(b) supervised loan licensees or those required to be licensed unless the entity:
(i) Enters into consumer credit sales or consumer leases;
(ii) assigns or accepts assignments of consumer credit sales or consumer leases; or
(iii) attorneys or collection agencies that receive payment for collection purposes.
History: L. 1973, ch. 85, § 109; L. 1981, ch. 93, § 18; L. 1993, ch. 200, § 14; L. 2005, ch. 144, § 20; L. 2009, ch. 29, § 24; L. 2024, ch. 6, § 114; January 1, 2025.
(1) Any person subject to K.S.A. 16a-6-201, and amendments thereto, shall file notice with the administrator within 30 days after commencing business in this state, and, thereafter, in accordance with rules and regulations adopted by the administrator.
(2) If information in a filing becomes inaccurate, the consumer credit filer shall file an amended filing as prescribed by rules and regulations adopted by the administrator.
History: L. 1973, ch. 85, § 110; L. 1988, ch. 85, § 12; L. 1999, ch. 107, § 33; L. 2024, ch. 6, § 115; January 1, 2025.
(1) A consumer credit filer shall on or before August 31 of each year pay to the administrator an annual fee in an amount established pursuant to K.S.A. 16a-6-104(5), and amendments thereto, for each business location for that year.
(2) Consumer credit filers who are sellers, lessors or lenders shall pay an additional fee at the time and in the manner stated in subsection (1), in an amount established pursuant to K.S.A. 16a-6-104(5), and amendments thereto.
(3) Consumer credit filers who are assignees shall pay an additional fee at the time and in the manner stated in subsection (1), in an amount established pursuant to K.S.A. 16a-6-104(5), and amendments thereto.
History: L. 1973, ch. 85, § 111; L. 1976, ch. 98, § 3; L. 1978, ch. 73, § 1; L. 2000, ch. 27, § 5; L. 2005, ch. 144, § 21; L. 2009, ch. 29, § 25; L. 2024, ch. 6, § 116; January 1, 2025.
History: L. 1973, ch. 85, § 112; Repealed, L. 1999, ch. 107, § 34; July 1.
History: L. 1973, ch. 85, § 113; L. 1974, ch. 348, § 101; L. 1975, ch. 416, § 28; L. 1978, ch. 308, § 43; Repealed, L. 1981, ch. 299, § 64; L. 1981, ch. 96, § 1; July 1.
History: L. 1973, ch. 85, §§ 114, 115; Repealed, L. 1989, ch. 74, § 1; July 1.
This part applies to the administrator, prescribes the procedures to be observed by the administrator in exercising such powers under K.S.A. 16a-1-101 et seq., and amendments thereto, and supplements the powers and functions of the administrator under K.S.A. 16a-1-101 et seq., and amendments thereto. Subject to specific provisions found in K.S.A. 16a-1-101 et seq., and amendments thereto, the exercise of powers by the administrator shall be subject to the adoption of rules and regulations pursuant to K.S.A. 77-415 et seq., and amendments thereto, the Kansas administrative procedure act, K.S.A. 77-501 et seq., and amendments thereto, and the Kansas judicial review act, K.S.A. 77-601 et seq., and amendments thereto.
History: L. 1973, ch. 85, § 116; L. 2024, ch. 6, § 117; January 1, 2025.
History: L. 1973, ch. 85, § 117; L. 1988, ch. 356, § 48; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
(1) In addition to other rule-making requirements, the administrator may:
(a) Adopt as a rule a description of the organization of the administrator's office, stating the general course and method of the operations of the office and the methods whereby the public may obtain information or make submissions or requests;
(b) adopt rules of practice setting forth the nature and requirements of all formal and informal procedures available, including a description of all forms and instructions used by the administrator or by the office;
(c) make available for public inspection all rules and all other written statements of policy or interpretations formulated, adopted or used by the administrator; and
(d) make available for public inspection all final orders, decisions and opinions.
(2) No rule, order or decision of the administrator is valid or effective against any person or party, nor may it be invoked by the administrator for any purpose, until it has been made available for public inspection as herein required. This provision is not applicable in favor of any person or party who has actual knowledge thereof.
History: L. 1973, ch. 85, § 118; L. 1981, ch. 95, § 2; L. 2024, ch. 6, § 118; January 1, 2025.
History: L. 1973, ch. 85, § 119; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
History: L. 1973, ch. 85, § 120; L. 1988, ch. 366, § 4; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
History: L. 1973, ch. 85, § 121; L. 1988, ch. 366, § 5; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
History: L. 1973, ch. 85, § 122; L. 1981, ch. 95, § 3; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
History: L. 1973, ch. 85, § 123; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
History: L. 1973, ch. 85, § 124; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
History: L. 1973, ch. 85, § 125; L. 1988, ch. 356, § 49; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
History: L. 1973, ch. 85, §§ 126, 127; Repealed, L. 1988, ch. 356, § 361; July 1, 1989.
History: L. 1973, ch. 85, § 128; Repealed, L. 2009, ch. 29, § 26; July 1.
History: L. 1973, ch. 85, § 129; L. 1986, ch. 318, § 22; L. 2010, ch. 17, § 37; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
Revisor's Note: * The phrase "this act" includes 16a-1-101 through 16a-9-102, 16-207, 16-403, 17-2214 and 84-9-203.
History: L. 1973, ch. 85, § 130; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
Revisor's Note: * The phrase "this act" includes 16a-1-101 through 16a-9-102, 16-207, 16-403, 17-2214 and 84-9-203.
History: L. 1973, ch. 85, § 131; Repealed, L. 2024, ch. 6, § 120; January 1, 2025.
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