LB 474 (2025) — Nebraska Money Transmitters Act rewritten as MTMA, slip law (Part 2 of 3)
Document text
Research, not advice. Part of the Bitcoin research archive (October 2026). Claims labelled unverified, contested or fringe are reported, not endorsed; statuses of bills and rules are as of the date checked. Government, court and patent records are public domain; the research notes are CC BY 4.0.
become a claim by the death of
the insured, settlement shall be made upon receipt of due proof of death, or
not later than two months after receipt of such proof.
(13) In case the proceeds of a policy are payable in installments, or as
an annuity, a table showing the amounts of the installments or annuity
payments.
(14) A title on the face of the policy correctly describing the same. Any
of the foregoing provisions or portions of this section not applicable by
reason of the plan of insurance may, to the extent of inapplicability, be
omitted from the policy. Any such policy may be issued or delivered in this
state which in the opinion of the Department of Insurance contains provisions
on any one or more of the several foregoing requirements more favorable to the
policyholder than hereinbefore required.
(15)(a) For policies issued or delivered in this state on or after January
1, 2026, a provision that, at least fifteen days prior to termination or lapse
by reason of default in payment of any premium due on such policy, a notice
will be sent electronically or mailed to the last-known address of the owner
and any assignee on record with the company.
(b) For policies issued or delivered in this state on or after January 1,
2026, an assignee shall have the same legal standing as the owner with respect
to subdivision (15)(a) of this section.
Sec. 51. Section 44-1703, Reissue Revised Statutes of Nebraska, is amended
to read:
44-1703 All life insurance and all accident and health insurance sold in
connection with loans or other credit transactions shall be subject to sections
44-1701 to 44-1713 except such insurance sold in connection with a loan or
other credit transaction of more than ten years duration or fifteen years
duration when made by licensees under the Nebraska Installment Loan and Sales
Act. No insurance shall be subject to sections 44-1701 to 44-1713 when the
issuance of such insurance is an isolated transaction on the part of the
insurer and not related to an agreement or a plan for insuring debtors of the
creditor.
Sec. 52. Section 44-4109.01, Reissue Revised Statutes of Nebraska, is
amended to read:
44-4109.01 Policies or contracts authorized by sections 44-4109 and
44-4110 are subject to the following requirements:
(1) A prospective insured shall be provided information about the terms
and conditions of the insurance arrangement to enable him or her to make an
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informed decision about accepting a system of health care delivery. If the
insurance arrangement is described orally to a prospective insured, the
description shall use easily understood, truthful, and objective terms. All
written descriptions shall be in a readable and understandable format. Specific
items that shall be included are:
(a) Coverage provisions, benefits, and any exclusions by category of
service, provider, or physician and, if applicable, by specific service;
(b) Any prior authorization or other review requirements, including
preauthorization review, concurrent review, postservice review, and postpayment
review, the manner in which an insured may obtain review of a denial of
coverage, and the nature of any liability an insured may incur if the insured
does not comply with the authorization requirements of the policy, contract,
certificate, or other materials; and
(c) Information on the insured's financial responsibility for payment for
deductibles, coinsurance, or other noncovered services;
(2) If an insurer conducts customer satisfaction surveys concerning an
insurance arrangement, the results of such surveys shall be made available upon
request to existing and prospective participants in insurance arrangements;
(3) The policy, contract, certificate, or other materials shall establish
a mechanism by which a committee of preferred providers will be involved in
reviewing and advising the insurance arrangement about medical policy,
including coverage of new technology and procedures, quality and credentialing
criteria, and medical management procedures;
(4) All policies or contracts shall have a system for credentialing
participating preferred providers and shall allow all providers within the
insurance arrangement's geographic service area to apply for such credentials
periodically and not less than annually. The credentialing process:
(a) Shall begin upon application of a provider for inclusion in the policy
or contract; and
(b) Shall be based solely on quality, accessibility, or economic
considerations and shall be applied in accordance with reasonable business
judgment.
Credentialing standards or criteria shall be made available, upon request,
to providers and insureds;
(5) If the policy or contract is with an organized delivery system formed
by insurers, hospitals, physicians, or allied health professionals, or a
combination of such entities, participation by a provider may be limited to a
participant in the organized delivery system or to providers having staff
privileges at a particular health care facility;
(6) If an insurer or a participant in an insurance arrangement refuses to
contract with a provider, the provider shall be permitted to appeal the adverse
decision. A person conducting the provider-appeal procedure may be employed by
the insurer or participant in an insurance arrangement if the person does not
initially participate in the decision to take adverse action against the
provider. The provider-appeal procedure shall include, but not be limited to,
notice of the date and time of the hearing, a statement of the criteria or
standards on which the decision was based, an opportunity for the provider to
review information upon which the adverse decision was based, an opportunity
for the provider to appear personally at the hearing and present any additional
information, and a timely decision on the appeal;
(7) If the insurer or participant in an insurance arrangement excludes or
fails to retain a provider previously contracted with to provide health care
services, the provider shall be permitted to appeal the adverse decision in the
same manner as set forth in subdivision (6) of this section. If the provider
disagrees with the decision, the provider shall be permitted to appeal to an
appeals committee consisting of one person selected by each party to the appeal
and one person mutually agreeable to both parties. The parties to the appeal
shall pay to the appeal committee any costs associated with the person they
select and shall share the costs of the person mutually agreeable to both
parties, which costs shall not be recoverable by the other party;
(8) Prior to initiation of a proceeding to terminate a provider's
participation, the provider shall be given an opportunity to enter into and
complete a corrective action plan, except in cases of fraud or imminent harm to
patient health or when the provider's ability to provide services has been
restricted by an action, including probation or any compliance agreements, by
the Department of Health and Human Services or other governmental agency; and
(9) Policies and contracts shall not exclude a provider (a) providers with
a practice practices containing a substantial number of patients having severe
or expensive medical conditions or (b) who holds a visiting faculty permit as
described in section 38-2045. An insurance arrangement shall not be
prohibited , except that this section shall not prohibit plans from excluding a
provider providers who fails fail to meet the insurance arrangement's criteria
for quality, accessibility, or economic considerations.
Sec. 53. Section 45-101.04, Reissue Revised Statutes of Nebraska, is
amended to read:
45-101.04 The limitation on the rate of interest provided in section
45-101.03 shall not apply to:
(1) Other rates of interest authorized for loans made by any licensee or
permittee operating under a license or permit duly issued by the Department of
Banking and Finance pursuant to the Credit Union Act, the Nebraska Installment
Loan and Sales Act, subsection (4) of section 8-319, or sections 8-815 to
8-829;
(2) Loans made to any corporation, partnership, limited liability company,
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or trust;
(3) The guarantor or surety of any loan to a corporation, partnership,
limited liability company, or trust;
(4) Loans made when the aggregate principal amount of the indebtedness is
twenty-five thousand dollars or more of the borrower to any one financial
institution, licensee, or permittee;
(5) Loans insured, guaranteed, sponsored, or participated in, either in
whole or part, by any agency, department, or program of the United States or
state government;
(6) Loans or advances of money, repayable on demand, which are made solely
upon securities, as defined in subdivision (15) of section 8-1101, pledged as
collateral for such repayment and in which such loans or advances are used by
the borrower only for the purchase of securities as so defined. It shall be
lawful to contract for and receive any rate of interest on such transaction as
the parties thereto may expressly agree;
(7) Interest charges made on open credit accounts by a person who sells
goods or services on credit when the interest charges do not exceed one and
one-third percent per month for any charges which remain unpaid for more than
thirty days following rendition of the statement of account;
(8) A minimum charge of ten dollars per loan which may be charged by the
lender in lieu of all interest charges;
(9) Loans described in subsection (4) of section 8-319 made by a state or
federal savings and loan association at a rate not to exceed nineteen percent
per annum;
(10) Loans made primarily for business or agricultural purposes or secured
by real property when such loans are made (a) by a licensee, registrant, or
permittee operating under a license, registration, or permit duly issued by the
Department of Banking and Finance except for licensees operating under the
Nebraska Installment Loan and Sales Act, (b) by any financial institution
insured by the Federal Deposit Insurance Corporation or the National Credit
Union Administration, or (c) by any insurance company organized under the laws
of this state and subject to regulation by the Department of Insurance;
(11) Loans secured solely by real property when such loans are (a) made by
licensees operating under the Nebraska Installment Loan and Sales Act and (b)
made to finance or refinance the purchase of the property or construction on or
improvements to the property, if the Department of Banking and Finance has the
authority to examine such loans for compliance with sections 45-101.02 and
45-101.03. A licensee making a loan pursuant to this subdivision may obtain an
interest in any fixtures attached to such real property and any insurance
proceeds payable in connection with such real property or the loan;
(12) Loans secured by a reverse mortgage pursuant to section 45-702.01;
(13) Interest charges made on any goods or services sold under an
installment contract pursuant to the Nebraska Installment Loan and Sales Act.
Subject to section 86 of this act 45-338, it shall be lawful to contract for
and receive any rate of interest on such contract as the parties may expressly
agree to in writing; or
(14) Fees which may be charged by a licensee for services pursuant to the
Delayed Deposit Services Licensing Act.
Sec. 54. Section 45-1,110, Reissue Revised Statutes of Nebraska, is
amended to read:
45-1,110 Sections 45-1,105 to 45-1,110 shall not apply to any licensee
operating under the Nebraska Installment Loan and Sales Act.
Sec. 55. Section 45-334, Reissue Revised Statutes of Nebraska, is amended
to read:
45-334 Sections 45-334 to 45-356 and sections 70 and 78 to 101 of this act
shall be known and may be cited as the Nebraska Installment Loan and Sales Act.
Sec. 56. Section 45-335, Reissue Revised Statutes of Nebraska, is amended
to read:
45-335 For purposes of the Nebraska Installment Loan and Sales Act, unless
the context otherwise requires:
(1) Applicant means a person applying for a license under the Nebraska
Installment Loan and Sales Act;
(2) Basic time price means the cash sale price of the goods or services
which are the subject matter of an installment sales contract plus the amount
included therein, if a separate identified charge is made therefor and stated
in the contract, for insurance, registration, certificate of title, debt
cancellation contract, debt suspension contract, electronic title and lien
services, guaranteed asset protection waiver, and license fees, filing fees, an
origination fee, and fees and charges prescribed by law which actually are or
will be paid to public officials for determining the existence of or for
perfecting, releasing, or satisfying any security related to the credit
transaction or any charge for nonfiling insurance if such charge does not
exceed the amount of fees and charges prescribed by law which would have been
paid to public officials for filing, perfecting, releasing, and satisfying any
security related to the credit transaction and less the amount of the buyer's
downpayment in money or goods or both;
(3) Branch office means any location, other than the main office location,
at which the business of a licensee is to be conducted, including:
(a) Any offices physically located in Nebraska; and
(b) Any offices that, while not physically located in this state, intend
to transact business with Nebraska residents;
(4) Breach of security of the system means unauthorized acquisition of
data that compromises the security, confidentiality, or integrity of
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information;
(5) Buyer means a person who buys goods or obtains services from a seller
in an installment sale;
(6) Cash price or cash sale price means the price stated in an installment
sales contract for which the seller would have sold or furnished to the buyer
and the buyer would have bought or acquired from the seller goods or services
which are the subject matter of the contract if such sale had been a sale for
cash instead of an installment sale. It may include the cash price of
accessories or services related to the sale such as delivery, installation,
alterations, modifications, and improvements and may include taxes to the
extent imposed on the cash sale;
(7) Consumer means an individual who is a resident of Nebraska and who
seeks to obtain, obtains, or has obtained financial products or services that
are to be used primarily for personal, family, or household purposes;
(8)(a) Control in the case of a corporation means (i) direct or indirect
ownership of or the right to control twenty-five percent or more of the voting
shares of the corporation or (ii) the ability of a person or group acting in
concert to elect a majority of the directors or otherwise effect a change in
policy.
(b) Control in the case of any other entity means (i) the power, directly
or indirectly, to direct the management or policies of the entity, (ii) the
contribution of twenty-five percent or more of the capital of the entity, or
(iii) the right to receive, upon dissolution, twenty-five percent or more of
the capital of the entity;
(9) Debt cancellation contract means a loan term or contractual
arrangement modifying loan terms under which a financial institution or
licensee agrees to cancel all or part of a buyer's obligation to repay an
extension of credit from the financial institution or licensee upon the
occurrence of a specified event. The debt cancellation contract may be separate
from or a part of other loan documents. The term debt cancellation contract
does not include loan payment deferral arrangements in which the triggering
event is the buyer's unilateral election to defer repayment or the financial
institution's or licensee's unilateral decision to allow a deferral of
repayment;
(10) Debt suspension contract means a loan term or contractual arrangement
modifying loan terms under which a financial institution or licensee agrees to
suspend all or part of a buyer's obligation to repay an extension of credit
from the financial institution or licensee upon the occurrence of a specified
event. The debt suspension contract may be separate from or a part of other
loan documents. The term debt suspension contract does not include loan payment
deferral arrangements in which the triggering event is the buyer's unilateral
election to defer repayment or the financial institution's or licensee's
unilateral decision to allow a deferral of repayment;
(11) Department means the Department of Banking and Finance;
(12) Director means the Director of Banking and Finance;
(13) Financial institution has the same meaning as in section 8-101.03;
(14) Goods means all personal property, except money or things in action,
and includes goods which, at the time of sale or subsequently, are so affixed
to realty as to become part thereof whether or not severable therefrom;
(15) Guaranteed asset protection waiver means a waiver that is offered,
sold, or provided in accordance with the Guaranteed Asset Protection Waiver
Act;
(16) Installment sale means any transaction, whether or not involving the
creation or retention of a security interest, in which a buyer acquires goods
or services from a seller pursuant to an agreement which provides for a time-
price differential and under which the buyer agrees to pay all or part of the
time-sale price in one or more installments and within one hundred forty-five
months, except that the purchase of mobile homes may exceed such one-hundred-
forty-five-month limitation. Installment sale does not include a consumer
rental purchase agreement defined in and regulated by the Consumer Rental
Purchase Agreement Act;
(17) Installment sales contract means an agreement entered into in this
state evidencing an installment sale except those otherwise provided for in
separate acts;
(1) Goods means all personal property, except money or things in action,
and includes goods which, at the time of sale or subsequently, are so affixed
to realty as to become part thereof whether or not severable therefrom;
(2) Services means work, labor, and services of any kind performed in
conjunction with an installment sale but does not include services for which
the prices charged are required by law to be established and regulated by the
government of the United States or any state;
(3) Buyer means a person who buys goods or obtains services from a seller
in an installment sale;
(4) Seller means a person who sells goods or furnishes services to a buyer
under an installment sale;
(5) Installment sale means any transaction, whether or not involving the
creation or retention of a security interest, in which a buyer acquires goods
or services from a seller pursuant to an agreement which provides for a time-
price differential and under which the buyer agrees to pay all or part of the
time-sale price in one or more installments and within one hundred forty-five
months, except that installment contracts for the purchase of mobile homes may
exceed such one-hundred-forty-five-month limitation. Installment sale does not
include a consumer rental purchase agreement defined in and regulated by the
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Consumer Rental Purchase Agreement Act;
(6) Installment contract means an agreement entered into in this state
evidencing an installment sale except those otherwise provided for in separate
acts;
(7) Cash price or cash sale price means the price stated in an installment
contract for which the seller would have sold or furnished to the buyer and the
buyer would have bought or acquired from the seller goods or services which are
the subject matter of the contract if such sale had been a sale for cash
instead of an installment sale. It may include the cash price of accessories or
services related to the sale such as delivery, installation, alterations,
modifications, and improvements and may include taxes to the extent imposed on
the cash sale;
(8) Basic time price means the cash sale price of the goods or services
which are the subject matter of an installment contract plus the amount
included therein, if a separate identified charge is made therefor and stated
in the contract, for insurance, registration, certificate of title, debt
cancellation contract, debt suspension contract, electronic title and lien
services, guaranteed asset protection waiver, and license fees, filing fees, an
origination fee, and fees and charges prescribed by law which actually are or
will be paid to public officials for determining the existence of or for
perfecting, releasing, or satisfying any security related to the credit
transaction or any charge for nonfiling insurance if such charge does not
exceed the amount of fees and charges prescribed by law which would have been
paid to public officials for filing, perfecting, releasing, and satisfying any
security related to the credit transaction and less the amount of the buyer's
downpayment in money or goods or both;
(9) Time-price differential, however denominated or expressed, means the
amount, as limited in the Nebraska Installment Sales Act, to be added to the
basic time price;
(10) Time-sale price means the total of the basic time price of the goods
or services, the amount of the buyer's downpayment in money or goods or both,
and the time-price differential;
(11) Sales finance company means a person purchasing one or more
installment contracts from one or more sellers or acquiring any rights of
ownership, servicing, or other forms of participation in or otherwise engaging
with a consumer on behalf of the purchaser of one or more installment sales
contracts from one or more sellers. Sales finance company includes, but is not
limited to, a financial institution or installment loan licensee, if so
engaged;
(12) Department means the Department of Banking and Finance;
(13) Director means the Director of Banking and Finance;
(14) Financial institution has the same meaning as in section 8-101.03;
(15) Debt cancellation contract means a loan term or contractual
arrangement modifying loan terms under which a financial institution or
licensee agrees to cancel all or part of a buyer's obligation to repay an
extension of credit from the financial institution or licensee upon the
occurrence of a specified event. The debt cancellation contract may be separate
from or a part of other loan documents. The term debt cancellation contract
does not include loan payment deferral arrangements in which the triggering
event is the buyer's unilateral election to defer repayment or the financial
institution's or licensee's unilateral decision to allow a deferral of
repayment;
(16) Debt suspension contract means a loan term or contractual arrangement
modifying loan terms under which a financial institution or licensee agrees to
suspend all or part of a buyer's obligation to repay an extension of credit
from the financial institution or licensee upon the occurrence of a specified
event. The debt suspension contract may be separate from or a part of other
loan documents. The term debt suspension contract does not include loan payment
deferral arrangements in which the triggering event is the buyer's unilateral
election to defer repayment or the financial institution's or licensee's
unilateral decision to allow a deferral of repayment;
(17) Guaranteed asset protection waiver means a waiver that is offered,
sold, or provided in accordance with the Guaranteed Asset Protection Waiver
Act;
(18) Licensee means any person who obtains a license under the Nebraska
Installment Loan and Sales Act;
(19) Loan or installment loan means a loan or any extension of credit to a
consumer originated or made with an interest rate greater than the maximum
interest rate allowed under section 45-101.03, a minimum loan term of six
months, and a principal balance of less than twenty-five thousand dollars;
(20) Mortgage loan originator has the same meaning as in section 45-702;
(19) Person means individual, partnership, limited liability company,
association, financial institution, trust, corporation, and any other legal
entity;
(20) Breach of security of the system means unauthorized acquisition of
data that compromises the security, confidentiality, or integrity of the
information maintained by the Nationwide Mortgage Licensing System and
Registry, its affiliates, or its subsidiaries;
(21) Nationwide Mortgage Licensing System and Registry means a licensing
system, also known as the Nationwide Multistate Licensing System and Registry,
developed and maintained by the Conference of State Bank Supervisors and the
American Association of Residential Mortgage Regulators for the licensing and
registration of mortgage loan originators, mortgage bankers, installment loan
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companies, and other state-regulated financial services entities and
industries;
(22) Person means individual, partnership, limited liability company,
association, financial institution, trust, corporation, or any other legal
entity;
(23) Real property means an owner-occupied single-family, two-family,
three-family, or four-family dwelling which is located in this state, which is
occupied, used, or intended to be occupied or used for residential purposes,
and which is, or is intended to be, permanently affixed to the land;
(24) Sales finance company means a person purchasing one or more
installment sales contracts from one or more sellers or acquiring any rights of
ownership, servicing, or other forms of participation in or otherwise engaging
with a consumer on behalf of the purchaser of one or more installment sales
contracts from one or more sellers. Sales finance company includes, but is not
limited to, a financial institution or installment loan licensee, if so
engaged;
(25) Seller means a person who sells goods or furnishes services to a
buyer under an installment sale;
(26) Services means work, labor, and services of any kind performed in
conjunction with an installment sale but does not include services for which
the prices charged are required by law to be established and regulated by the
government of the United States or any state;
(27) Time-price differential, however denominated or expressed, means the
amount, as limited in the Nebraska Installment Loan and Sales Act, to be added
to the basic time price; and
(28) Time-sale price means the total of the basic time price of the goods
or services, the amount of the buyer's downpayment in money or goods or both,
and the time-price differential.
(22)(a) Control in the case of a corporation means (i) direct or indirect
ownership of or the right to control twenty-five percent or more of the voting
shares of the corporation or (ii) the ability of a person or group acting in
concert to elect a majority of the directors or otherwise effect a change in
policy.
(b) Control in the case of any other entity means (i) the power, directly
or indirectly, to direct the management or policies of the entity, (ii) the
contribution of twenty-five percent or more of the capital of the entity, or
(iii) the right to receive, upon dissolution, twenty-five percent or more of
the capital of the entity; and
(23) Branch office means any location, other than the main office
location, at which the business of a licensee is to be conducted, including (a)
any offices physically located in Nebraska, and (b) any offices that, while not
physically located in this state, intend to transact business with Nebraska
residents.
Sec. 57. Section 45-336, Reissue Revised Statutes of Nebraska, is amended
to read:
45-336 (1) An installment loan license shall be required for:
(a) Any person engaging in the business of making loans;
(b) Any person that holds or acquires any rights of ownership, servicing,
or other forms of participation in a loan or that engages with, or conducts
loan activity with, an installment loan borrower in connection with a loan; or
(c) Any person that is not a financial institution who, at or after the
time a loan is made by a financial institution, markets, owns in whole or in
part, holds, acquires, services, or otherwise participates in a loan.
(2) Any person may, after procuring an installment loan license from the
department, engage or continue in the business of making loans of money and
charge, contract for, and receive the maximum for interest and other charges in
accordance with the authorization and requirements of the Nebraska Installment
Loan and Sales Act.
(3) An installment loan license shall not be required for:
(a)(i) A financial institution.
(ii) While no financial institution is eligible for an installment loan
license or to make loans under the Nebraska Installment Loan and Sales Act, an
installment loan license shall be required for any person that is not a
financial institution who, at or after the time a loan is made by a financial
institution, markets, owns in whole or in part, holds, acquires, services, or
otherwise participates in such loan;
(b)(i) An affiliate of an installment loan licensee if the activities of
the affiliate in this state are limited solely to the securitization of loans
made by the licensee and the servicing rights to the loans are retained by the
licensee or assigned or otherwise transferred to a financial institution,
licensee, or permittee.
(ii) For purposes of subdivision (b) of this subsection:
(A) Affiliate means an entity that controls, is controlled by, or is under
common control with another entity;
(B) Control means to own directly or indirectly or to control in any
manner twenty-five percent of the voting shares of an entity or to control in
any manner the election of the majority of directors of any entity; and
(C) Securitization means the placing of individual installment loans made
by licensees into a commingled or pooled security that is subsequently sold or
otherwise transferred to another entity.
(iii) Nothing in this subsection shall be construed to exempt a licensee
or affiliate from the Securities Act of Nebraska; and
(c) Any person, who is not an installment loan licensee, that only makes
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loans that do not exceed the maximum rate of interest permitted by section
45-101.03.
(4) An installment sales license shall be required for any person who acts
as a sales finance company in this state, whether or not such person maintains
an office, place of doing business, or agent in this state.
(5) An installment sales license shall not be required for:
(a) A financial institution or an installment loan licensee;
(b) A seller who does not otherwise act as a sales finance company, but
such seller shall comply with all of the other provisions of the Nebraska
Installment Loan and Sales Act in order to charge the time-price differential
allowed by section 86 of this act; or
(c) Persons that negotiate and enter into installment sales contracts by
United States mail without personal solicitation by salespersons or other
representatives of the seller and based upon the catalog of the seller or other
printed solicitation of business, which is distributed and made available
generally to the public, if such catalog or other printed solicitation clearly
sets forth the cash and time-sale prices and other terms of sales to be made
through such medium. All provisions of the Nebraska Installment Loan and Sales
Act shall apply to such sales, except that the seller shall not be required to
deliver a copy of the contract to the buyer pursuant to section 85 of this act
and if the contract when received by the seller contains any blank spaces, the
seller may insert in the appropriate blank space the amounts of money and other
terms which are set forth in the seller's catalog or other printed solicitation
which is then in effect. In lieu of sending the buyer a copy of the contract
pursuant to section 85 of this act, the seller shall furnish to the buyer a
written statement of any items inserted in the blank spaces in the contract
received from the buyer.
(6) Loans made by financial institutions that are serviced by or purchased
by a licensee shall not be subject to the interest rate limitations of the
Nebraska Installment Loan and Sales Act.
(1) Each retail installment contract shall be in writing, shall be signed
by both the buyer and the seller, and shall contain the following items and a
copy thereof shall be delivered to the buyer at the time the instrument is
signed, except for contracts made in conformance with section 45-340: (a) The
cash sale price; (b) the amount of the buyer's downpayment, and whether made in
money or goods, or partly in money and partly in goods, including a brief
description of any goods traded in; (c) the difference between subdivisions (a)
and (b) of this subsection; (d) the amount included for insurance if a separate
charge is made therefor, specifying the types of coverages; (e) the amount
included for a debt cancellation contract or a debt suspension contract if the
debt cancellation contract or debt suspension contract is a contract of a
financial institution or licensee, such contract is sold directly by such
financial institution or licensee or by an unaffiliated, nonexclusive agent of
such financial institution or licensee in accordance with 12 C.F.R. part 37, as
such part existed on January 1, 2011, and the financial institution or licensee
is responsible for the unaffiliated, nonexclusive agent's compliance with such
part, and a separate charge is made therefor; (f) the amount included for
electronic title and lien services other than fees and charges prescribed by
law which actually are or will be paid to public officials for determining the
existence of or for perfecting, releasing, or satisfying any security related
to the credit transaction; (g) the basic time price, which is the sum of
subdivisions (c), (d), (e), and (f) of this subsection; (h) the time-price
differential; (i) the amount of the time-price balance, which is the sum of
subdivisions (g) and (h) of this subsection, payable in installments by the
buyer to the seller; (j) the number, amount, and due date or period of each
installment; (k) the time-sales price; and (l) the amount included for a
guaranteed asset protection waiver.
(2) The contract shall contain substantially the following notice: NOTICE
TO THE BUYER. DO NOT SIGN THIS CONTRACT BEFORE YOU READ IT OR IF IT CONTAINS
BLANK SPACES. YOU ARE ENTITLED TO A COPY OF THE CONTRACT YOU SIGN.
(3) The items listed in subsection (1) of this section need not be stated
in the sequence or order set forth in such subsection. Additional items may be
included to explain the computations made in determining the amount to be paid
by the buyer. No installment contract shall be signed by the buyer or proffered
by seller when it contains blank spaces to be filled in after execution, except
that if delivery of the goods or services is not made at the time of the
execution of the contract, the identifying numbers or marks of the goods, or
similar information, and the due date of the first installment may be inserted
in the contract after its execution.
(4) If a seller proffers an installment contract as part of a transaction
which delays or cancels, or promises to delay or cancel, the payment of the
time-price differential on the contract if the buyer pays the basic time price,
cash price, or cash sale price within a certain period of time, the seller
shall, in clear and conspicuous writing, either within the installment contract
or in a separate document, inform the buyer of the exact date by which the
buyer must pay the basic time price, cash price, or cash sale price in order to
delay or cancel the payment of the time-price differential. The seller or any
subsequent purchaser of the installment contract, including a sales finance
company, shall not be allowed to change such date.
(5) Upon written request from the buyer, the holder of an installment
contract shall give or forward to the buyer a written statement of the dates
and amounts of payments and the total amount unpaid under such contract. A
buyer shall be given a written receipt for any payment when made in cash.
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(6) After payment of all sums for which the buyer is obligated under a
contract, the holder shall deliver or mail to the buyer at his or her last-
known address one or more good and sufficient instruments or copies thereof to
acknowledge payment in full and shall release all security in the goods and
mark canceled and return to the buyer the original agreement or copy thereof or
instruments or copies thereof signed by the buyer. For purposes of this
section, a copy shall meet the requirements of section 25-12,112.
Sec. 58. Section 45-337, Reissue Revised Statutes of Nebraska, is amended
to read:
45-337 (1) An application for either an installment loan license or an
installment sales license shall be on a form prescribed and furnished by the
director and shall include, but not be limited to:
(a) The applicant's name and any trade name or doing business as
designation which the applicant intends to use in this state;
(b) The applicant's main office address;
(c) All branch office addresses of the applicant at which business is to
be conducted;
(d) The names and titles of each director and principal officer of the
applicant;
(e) The names of all shareholders, partners, or members of the applicant;
(f) A description of the activities of the applicant in such detail as the
department may require;
(g) If the applicant is an individual, such individual's social security
number;
(h) Audited financial statements of the applicant showing a minimum net
worth of one hundred thousand dollars;
(i) Background checks of the applicant as provided in section 94 of this
act; and
(j) A surety bond as provided in section 45-338.
(2) All applications for licenses must be accompanied by any processing
fee allowed for by section 94 of this act, any application and processing fees
for associated branch applications pursuant to section 45-339, and a filing fee
of:
(a) One hundred fifty dollars for an installment sales license; and
(b) Five hundred dollars for an installment loan license.
(3) The director shall, after an application has been filed for a license
under the Nebraska Installment Loan and Sales Act, investigate the applicant to
determine whether all requirements for licensure have been met and to determine
if a finding can be made that the experience, character, and general fitness of
the applicant, of the members thereof if the applicant is a corporation or
association, and of the officers and directors thereof if the applicant is a
corporation, are such as to warrant belief that the business will be operated
honestly, fairly, and efficiently within the purposes of the Nebraska
Installment Loan and Sales Act.
(4) The director may, within the director's discretion, make an
examination and inspection concerning the propriety of the issuance of a
license to any applicant. The cost of such examination and inspection shall be
borne by the applicant.
(5) If all requirements to obtain a license under the Nebraska Installment
Loan and Sales Act are met and a finding can be made that the experience,
character, and general fitness of the applicant, of the members thereof if the
applicant is a corporation or association, and of the officers and directors
thereof if the applicant is a corporation, are such as to warrant belief that
the business will be operated honestly, fairly, and efficiently within the
purpose of the Nebraska Installment Loan and Sales Act, the director shall
issue and deliver a license to the applicant to do business in accordance with
the license and the Nebraska Installment Loan and Sales Act. The director shall
have the power to deny for cause any application for a license.
(6) The department shall approve or deny every application for a license
under the Nebraska Installment Loan and Sales Act within ninety days after the
filing of an application, if the application is substantially complete and is
accompanied by the required fees and the approved bond.
(7) A license issued under the Nebraska Installment Loan and Sales Act is
nontransferable and nonassignable.
(8) An initial license shall remain in full force and effect until the
next succeeding December 31. Each license shall remain in force until revoked,
suspended, canceled, expired, or surrendered.
(9) If an applicant for a license under the Nebraska Installment Loan and
Sales Act does not complete the license application and fails to respond to a
notice or notices from the department to correct the deficiency or deficiencies
for a period of one hundred twenty days or more after the date the department
sends the initial notice to correct the deficiency or deficiencies, the
department may deem the application as abandoned and may issue a notice of
abandonment of the application to the applicant in lieu of proceedings to deny
the application.
(10) Obtaining a license constitutes sufficient contact with this state
for the exercise of personal jurisdiction over the licensee in any action
arising out of the licensee's activity in this state.
(1) The amount, if any, included for insurance, which may be purchased by
the holder of the contract, shall not exceed the applicable premium rates
chargeable in accordance with filings, if any, with the Department of
Insurance. If dual interest insurance on the goods is purchased by the holder
it shall, within thirty days after execution of the installment contract, send
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or cause to be sent to the buyer a policy or policies or certificate of
insurance, written by an insurance company authorized to do business in this
state, clearly setting forth the amount of the premium, the kind or kinds of
insurance, the coverages, and all the terms and conditions of the contract or
contracts of insurance.
(2) If any insurance is canceled or the premium adjusted during the term
of the installment contract, any refund of the insurance premium plus the
unearned time-price differential thereon received by the holder shall be
credited by the holder to the last maturing installment of the contract except
to the extent applied toward payment for similar insurance protecting the
interests of the buyer and the holder or either of them.
(3) If any insurance is canceled due to the payment of all sums for which
the buyer is liable under an installment contract, the holder of the
installment contract shall, upon receipt of payment of all sums due, send
notice to the buyer within fifteen business days of the name, address, and
telephone number of the insurance company which issued the insurance contract
or the party responsible for any refund, and notice that the buyer may be
eligible for a refund. A copy of such notice shall be retained by the holder of
the installment contract. This subsection does not apply if the holder of the
loan contract previously credited the refund of the insurance premium to the
loan contract or otherwise refunded the insurance premium to the buyer.
(4) The holder may also purchase nonfiling insurance and charge a
reasonable fee. The fee shall not exceed the amount of fees and charges
prescribed by law which would have been paid to public officials for filing,
perfecting, releasing, and satisfying any lien or security interest in the
goods or services.
Sec. 59. Section 45-338, Reissue Revised Statutes of Nebraska, is amended
to read:
45-338 (1) An applicant for a license to be issued pursuant to the
Nebraska Installment Loan and Sales Act shall file with the department a surety
bond in the amount of fifty thousand dollars, furnished by a surety company
authorized to do business in this state. Such bond shall be increased by an
additional fifty thousand dollars for each branch location of the applicant
that is licensed under the Nebraska Installment Loan and Sales Act. The bond
shall be for the use of the State of Nebraska and any Nebraska resident who may
have claims or causes of action against the applicant. The surety may cancel
the bond only upon thirty days' prior written notice to the director.
(2)(a) Except as provided in subsection (3) of this section, an
installment loan licensee who employs or enters into an independent agent
agreement with an individual required to obtain a mortgage loan originator
license pursuant to the Residential Mortgage Licensing Act shall maintain the
surety bond required by subsection (1) of this section and a supplemental
surety bond. The supplemental surety bond posted by such installment loan
licensee shall cover all mortgage loan originators who are employees or
independent agents of such licensee. The supplemental surety bond shall be for
the use of the State of Nebraska and any Nebraska resident who may have claims
or causes of action against such licensee arising from a transaction involving
a residential mortgage loan, as defined in section 45-702, or against an
individual who is a mortgage loan originator employed by, or in an independent
agent relationship with, the licensee. The initial amount of the supplemental
surety bond shall be one hundred thousand dollars.
(b) Upon filing of the mortgage report of condition required by section
45-345, a licensee shall maintain or increase its supplemental surety bond to
reflect the total dollar amount of the closed residential mortgage loans
originated or serviced in this state in the preceding year in accordance with
the table in this subsection. A licensee may decrease its supplemental surety
bond in accordance with the table in this subsection if the supplemental surety
bond required is less than the amount of the supplemental surety bond on file
with the department.
Dollar Amount of Closed or Serviced Surety Bond Required
Residential Mortgage Loans
$0.00 through $5,000,000.00 $100,000
$5,000,000.01 through $10,000,000.00 $125,000
$10,000,000.01 through $25,000,000.00 $150,000
$25,000,000.01 and over $200,000
(3)(a) A person who employs or enters into an independent agent agreement
with an individual required to obtain a mortgage loan originator license
pursuant to the Residential Mortgage Licensing Act shall maintain a surety bond
for each license that he, she, or it holds as required in subsection (1) of
this section and shall also post one supplemental surety bond which shall cover
all licenses held by such person. The supplemental surety bond posted by such
person shall cover all mortgage loan originators who are employees or
independent agents of such person. The supplemental surety bond shall be for
the use of the State of Nebraska and any Nebraska resident who may have claims
or causes of action against such person arising from a transaction involving a
residential mortgage loan or against an individual who is a mortgage loan
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originator employed by, or in an independent agent relationship with, the
person. The amount of such supplemental surety bond shall be as follows:
(i) The initial supplemental surety bond shall be in the amount of one
hundred thousand dollars; and
(ii) Upon filing of the mortgage report of condition required by section
45-345, the person's supplemental surety bond shall be maintained in accordance
with subdivision (2)(b) of this section. For purposes of calculating the amount
of the bond that is required, the total dollar amount of the closed loans shall
include all residential mortgage loans in this state closed by the person.
(b) A person who holds one or more installment loan licenses pursuant to
the Nebraska Installment Loan and Sales Act and a mortgage banker license
pursuant to the Residential Mortgage Licensing Act shall not be required to
post and maintain a supplemental surety bond if such person meets the following
conditions:
(i) The person maintains a surety bond as provided in subsection (1) of
this section for each installment loan license the person holds;
(ii) The person maintains a mortgage banker surety bond as provided in
section 45-724; and
(iii) The mortgage banker surety bond covers all transactions involving
residential mortgage loans, including such transactions done pursuant to the
person's installment loan license or licenses.
(4) Should the department determine that an installment loan licensee does
not maintain a supplemental surety bond in the amount required by subsection
(2) or (3) of this section, the department shall give written notification to
the licensee requiring the licensee to increase the surety bond within thirty
days to the amount required by subsection (2) or (3) of this section.
(5) The bond or a substitute bond required by subsection (1) of this
section, applicable to all licensees under the Nebraska Installment Loan and
Sales Act, shall remain in effect or the licensee shall immediately cease
conducting licensable activity. If a licensee fails to maintain a surety bond
as required under this section, the department may issue a notice of
cancellation of the license in lieu of revocation proceedings.
(1)(a) Notwithstanding the provisions of any other law, the time-price
differential for any goods or services sold under an installment contract shall
be stated as a fixed or variable annual percentage rate and shall be at a rate
agreed to in writing, not to exceed eighteen percent per annum, except that a
minimum time-price differential of ten dollars may be charged on any
installment contract.
(b)(i) A buyer may be required, upon the execution of the installment
contract, to pay an origination fee of not to exceed ten dollars, except that
if the installment contract is for an installment sale of agricultural
machinery or equipment for use in commercial agriculture or if the installment
contract is for an installment sale of industrial machinery or equipment the
buyer may be required to pay (A) an origination fee of not to exceed one
hundred dollars if the cash sale price is less than twenty-five thousand
dollars or (B) an origination fee of not to exceed two hundred fifty dollars if
the cash sale price is twenty-five thousand dollars or more.
(ii) The origination fee shall be refundable if the installment contract
is canceled during the first thirty days. The origination fee may be collected
from the buyer or included in the principal balance of the installment contract
at the time the contract is made and shall not be considered interest or a
time-price differential.
(c) Nothing in the Nebraska Installment Sales Act prohibits a seller or
holder of an installment contract from contracting for, computing, and charging
a time-price differential based upon the application of the rate charged to the
unpaid principal balance for the number of days actually elapsed. The charges
so computed shall be used for the purpose of calculating the time-price
differential, the time-price balance, the amount of each installment, and the
time-sale price.
(d) When the installment contract is payable in substantially equal and
consecutive monthly installments, the time-price differential shall be computed
on the basic time price of each contract, as determined under the provisions of
section 45-336, from the date of the contract until the due date of the final
installment, notwithstanding that the time-price balance is required to be paid
in installments.
(2) When an installment contract provides for payment other than in
substantially equal and consecutive monthly installments, the time-price
differential may be at a rate which will provide the same return as is
permitted on substantially equal monthly payment contracts under subdivision
(1)(d) of this section, having due regard for the schedule of payments.
(3) Every contract payable in two or more installments shall provide for
payment of such installments by stating the date and amount of each installment
or the method by which any variable rate or installment shall be determined.
Sec. 60. Section 45-339, Reissue Revised Statutes of Nebraska, is amended
to read:
45-339 (1) Licensees under the Nebraska Installment Loan and Sales Act may
apply to establish branch offices, whether in this state, or in another state
or United States territory, at which the licensable business activities of the
licensee may be conducted.
(2) Such application shall be on a form prescribed and furnished by the
director and shall be accompanied by a branch application fee, along with any
processing fee allowed for by section 94 of this act. Such branch application
fees shall be:
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(a) Two hundred fifty dollars for an installment loan branch license; and
(b) One hundred dollars for an installment sales branch license.
Where a buyer makes any subsequent purchases of goods or services from a
seller from whom he has previously purchased goods or services under one or
more installment contracts and the amounts under such contract or contracts to
the extent of cash sale price thereof have not been fully paid the subsequent
purchases may be included in and consolidated with one or more of the prior
contract or contracts. A memorandum of such additional purchases shall be
prepared by the seller and inserted in or attached to the seller's counterpart
of the contract and shall set forth:
(1) The names of the seller and the buyer and a description of the
additional goods or services sold and all the information with respect to the
additional purchase required by section 45-336 to be included in an installment
contract;
(2) The consolidated time-price balance to be paid by the buyer; and
(3) The revised payments.
A copy of such memorandum shall be delivered to the buyer as provided in
and subject to the provisions of section 45-336. When such subsequent purchases
are made, the entire amount of all payments made prior to such subsequent
purchases shall be deemed to have been applied on previous purchases.
Each payment thereafter made on a consolidated installment contract shall
be deemed to be allocated to all of the various purchases in the same ratio or
proportion as the original cash sale prices of the various purchases bear to
one another. Where the amount of each deferred payment is increased in
connection with such subsequent purchase, the subsequent payments, at the
seller's option, may be deemed to be allocated as follows: An amount equal to
the original installment payment to the previous purchase, the balance to the
subsequent purchase. The amount of any initial payment or downpayment on the
subsequent purchase shall be allocated in its entirety to such subsequent
purchase. The provisions of this section shall not apply to cases involving
equipment, parts, or to other merchandise attached or affixed to goods
previously purchased, or to repairs or services in connection therewith
rendered by the seller at the buyer's request.
Sec. 61. Section 45-340, Reissue Revised Statutes of Nebraska, is amended
to read:
45-340 (1) For the annual renewal of an original license under the
Nebraska Installment Loan and Sales Act, the licensee shall file a renewal
application containing such information as the director may require to indicate
any material change in the information contained in the original application or
succeeding renewal applications, along with a renewal fee and any processing
fee allowed for by section 94 of this act.
(2) The renewal fee shall be:
(a) Two hundred fifty dollars for an installment loan license;
(b) One hundred twenty-five dollars for an installment loan branch
license;
(c) One hundred fifty dollars for an installment sales license; and
(d) One hundred dollars for an installment sales branch license.
(3) If a licensee fails to renew such licensee's license and does not
voluntarily surrender the license pursuant to this section, the department may
issue a notice of expiration of the license to the licensee in lieu of
revocation proceedings.
(4) Renewal of a license originally granted under the Nebraska Installment
Loan and Sales Act may be denied by the director on the following grounds:
(a) Material misstatement in the application for a license;
(b) Willful failure to comply with any provision of the Nebraska
Installment Loan and Sales Act relating to installment sales contracts or
installment loans;
(c) Failure to continue to meet the conditions under which the original
license was granted;
(d) Defrauding any buyer to the buyer's damage; or
(e) Fraudulent misrepresentation, circumvention, or concealment by the
licensee through whatever subterfuge or device of any of the material
particulars or the nature thereof required to be stated or furnished to a
consumer.
(5) Any person, licensee, or applicant potentially aggrieved by an order
of the director entered under this section may appeal the order. The appeal
shall be in accordance with the Administrative Procedure Act.
Installment contracts negotiated and entered into by mail without personal
solicitation by salespersons or other representatives of the seller and based
upon the catalog of the seller or other printed solicitation of business, which
is distributed and made available generally to the public, if such catalog or
other printed solicitation clearly sets forth the cash and time-sale prices and
other terms of sales to be made through such medium, may be made as provided in
this section. All provisions of the Nebraska Installment Sales Act shall apply
to such sales except that the seller shall not be required to deliver a copy of
the contract to the buyer as provided in section 45-336 and if the contract
when received by the seller contains any blank spaces the seller may insert in
the appropriate blank space the amounts of money and other terms which are set
forth in the seller's catalog or other printed solicitation which is then in
effect. In lieu of sending the buyer a copy of the contract as provided in
section 45-336, the seller shall furnish to the buyer a written statement of
any items inserted in the blank spaces in the contract received from the buyer.
Sec. 62. Section 45-341, Reissue Revised Statutes of Nebraska, is amended
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to read:
45-341 (1) A licensee may voluntarily surrender a license at any time by
delivering to the director written notice of the surrender. The department
shall cancel the license following such surrender.
(2) The director may, following a hearing under the Administrative
Procedure Act and the rules and regulations adopted and promulgated by the
department under the Nebraska Installment Loan and Sales Act, suspend or revoke
any license issued pursuant to the Nebraska Installment Loan and Sales Act. The
director may also impose an administrative fine on the licensee for each
separate violation of the Nebraska Installment Loan and Sales Act. The
department shall remit fines collected under this subsection to the State
Treasurer for distribution in accordance with Article VII, section 5, of the
Constitution of Nebraska. The director may suspend or revoke a license or fine
a licensee under this subsection if the director finds:
(a) The licensee has materially violated or demonstrated a continuing
pattern of violating the Nebraska Installment Loan and Sales Act, rules and
regulations adopted and promulgated under the Nebraska Installment Loan and
Sales Act, any order issued under the Nebraska Installment Loan and Sales Act,
or any other state or federal law applicable to the conduct of the licensee's
business;
(b) A fact or condition exists which if such fact or condition had existed
at the time of the original application for the license, would have warranted
the director to deny the license application of the licensee;
(c) The licensee has violated a voluntary consent or compliance agreement
which had been entered into with the director;
(d) The licensee has knowingly provided or caused to be provided to the
director any false or fraudulent representation of a material fact or any false
or fraudulent financial statement or suppressed or withheld from the director
any information which, if submitted by the licensee, would have resulted in
denial of the license application of the licensee;
(e) The licensee has refused to permit an examination of the licensee by
the director or failed to comply with a notice of investigation or inquiry
pursuant to section 45-346 or failed to make any report required under section
45-345. Each day the licensee continues in violation of this subdivision
constitutes a separate violation;
(f) The licensee has failed to maintain records as required by the
director following written notice. Each day the licensee continues in violation
of this subdivision constitutes a separate violation;
(g) The licensee knowingly has employed any individual or knowingly has
maintained a contractual relationship with any individual acting as an agent,
if such individual has been convicted of, pleaded guilty to, or was found
guilty after a plea of nolo contendere to:
(i) A misdemeanor under any state or federal law which involves dishonesty
or fraud or which involves any aspect of the installment sales business,
installment loan business, mortgage banking business, or financial institution
business; or
(ii) Any felony under state or federal law;
(h) The licensee has violated the written restrictions or conditions under
which the license was issued;
(i) The licensee or, if the licensee is a business entity, one of the
officers, directors, members, partners, or controlling shareholders was found
guilty after a plea of nolo contendere to:
(i) A misdemeanor under any state or federal law which involves dishonesty
or fraud or which involves any aspect of the installment sales business,
installment loan business, mortgage banking business, or financial institution
business; or
(ii) Any felony under state or federal law; or
(j) The licensee knowingly has employed any individual or knowingly has
maintained a contractual relationship with any individual acting as an agent,
if such individual is conducting activities requiring a mortgage loan
originator license in this state without first obtaining such license.
(3) If a licensee is a partnership, limited liability company,
association, or corporation, it shall be sufficient cause for the suspension or
revocation of a license that any officer, director, or trustee of a licensed
association or corporation or any member of a licensed partnership or limited
liability company has so acted or failed to act as would be cause for
suspending or revoking a license to such party as an individual.
(4) No license shall be denied, suspended, or revoked except after hearing
in accordance with the Administrative Procedure Act. The director shall give a
licensee at least ten days' written notice, in the form of an order to show
cause, of the time and place of such hearing by either registered or certified
mail addressed to the principal place of business in this state of such
licensee. Such notice shall contain the grounds of complaint against the
licensee. Any order suspending or revoking such license shall recite the
grounds upon which the order is based. The order shall be entered upon the
records of the director and shall not be effective until after thirty days'
written notice thereof given after such entry forwarded by either registered or
certified mail to the licensee at the principal place of business in this state
of such licensee.
(5) Revocation, suspension, cancellation, expiration, or surrender of any
license shall not impair or affect the obligation of any lawful contract
entered into or acquired previously thereto by the licensee.
(6) Revocation, suspension, cancellation, expiration, or surrender of any
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license shall not affect civil or criminal liability for acts committed before
the revocation, suspension, cancellation, expiration, or surrender or affect
liability for any fines which may be levied against the licensee or any of the
licensee's officers, directors, shareholders, partners, or members pursuant to
the Nebraska Installment Loan and Sales Act for acts committed before the
revocation, suspension, cancellation, expiration, or surrender of the license.
(7) Whenever, for any cause, a license is revoked, the department shall
not issue another license to the licensee unless the department is otherwise
ordered by a court of competent jurisdiction to do so.
(8) At the request of the licensee or any other aggrieved person, the
department shall prepare a written record which includes a transcript of the
evidence, the findings with respect to the evidence, the order, and the reasons
supporting the suspension, revocation, or denial of a license, and shall, after
being paid for the cost of the written record, deliver to the licensee or other
aggrieved person a copy of the written record in person or by certified or
registered mail.
(9) Any person, licensee, or applicant potentially aggrieved by an order
of the director entered under this section may appeal the order. The appeal
shall be in accordance with the Administrative Procedure Act.
An installment contract may provide and the holder thereof may collect, in
addition to any time-price differential, a delinquency charge on each
installment in default for a period of not less than fifteen days, if provided
for in the contract, not in excess of five percent of each installment or
twenty-five dollars, whichever is less, or, in lieu thereof, interest after
maturity on each such installment not exceeding the highest permissible
contract rate. If the time-price differential is computed by application of the
rate charged to the unpaid principal balance for the number of days actually
elapsed, such delinquency charge may not exceed five percent of each
installment or twenty-five dollars, whichever is less. If any installment
payment is made by a check, draft, or similar signed order which is not honored
because of insufficient funds, no account, or any other reason except an error
of a third party to the contract, the holder may charge and collect a fee of
not more than fifteen dollars. The delinquency charge and such fee may be
collected when due or at any time thereafter.
When an installment contract is for a commercial or business purpose (1) a
delinquency charge not to exceed five percent of each unpaid installment may be
contracted for and received and (2) the holder of any check or draft or similar
order which is not honored for any reason, except for error of a third party,
may charge and collect a fee as stated in the contract. As used in this
section, commercial or business purpose means primarily for a purpose other
than a personal, family, or household purpose.
Sec. 63. Section 45-342, Reissue Revised Statutes of Nebraska, is amended
to read:
45-342 Any person who, by any device, subterfuge, or pretense whatsoever,
engages in or continues any of the kinds of business or enterprise permitted to
licensees by the Nebraska Installment Loan and Sales Act without having
obtained the license required by the act, with intent to evade the provisions
of the act, is guilty of a Class I misdemeanor.
(1) Notwithstanding the provisions of any contract to the contrary, any
buyer may prepay in full at any time before maturity the obligation of any
contract.
(2) If such obligation is prepaid in full by cash, a new loan, or
otherwise after the first installment due date, the borrower shall receive a
rebate of an amount which shall be not less than the amount obtained by
applying to the unpaid principal balances as originally scheduled or, if
deferred, as deferred, for the period following prepayment, according to the
actuarial method, the rate of the time-price differential previously stated to
the borrower. The licensee may round the rate of the time-price differential to
the nearest one-half of one percent if such procedure is not consistently used
to obtain a greater yield than would otherwise be permitted. Any default and
deferment charges which are due and unpaid may be deducted from any rebate. No
rebate shall be required for any partial prepayment. No rebate of less than one
dollar need be made. Acceleration of the maturity of the contract shall not in
itself require a rebate. If judgment is obtained before the final installment
date, the contract balance shall be reduced by the rebate which would be
required for prepayment in full as of the date judgment is obtained.
Sec. 64. Section 45-343, Reissue Revised Statutes of Nebraska, is amended
to read:
45-343 A licensee may move its main office or may relocate a branch office
from one location to another without obtaining a new license if the licensee
gives notice thereof to the director through the Nationwide Mortgage Licensing
System and Registry at least thirty days prior to such move and pays a filing
fee of one hundred fifty dollars. The director may, at the director's
discretion, hold a hearing on the relocation request, in accordance with the
Administrative Procedure Act. The expense of any such hearing shall be paid by
the licensee.
Any person who violates any provision of the Nebraska Installment Sales
Act or acts as a sales finance company in this state without a license therefor
as provided in the Nebraska Installment Sales Act shall be guilty of a Class II
misdemeanor.
Sec. 65. Section 45-344, Reissue Revised Statutes of Nebraska, is amended
to read:
45-344 (1) No person acting personally or as an agent shall acquire
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control of any licensee under the Nebraska Installment Loan and Sales Act
without first (a) giving thirty days' notice to the department on a form
prescribed by the department of such proposed acquisition and (b) paying a
filing fee of one hundred fifty dollars and any processing fee allowed under
subsection (2) of section 94 of this act.
(2) The director, upon receipt of such notice, shall approve or deny the
acquisition within thirty days.
(3) If the director does not deny the acquisition within such thirty-day
time period, the acquisition shall become effective on the thirty-first day
after the receipt of the notice, except that the director may extend the
thirty-day period an additional thirty days if, in the director's judgment, any
material information submitted is substantially inaccurate or the acquiring
party has not furnished all the information required by the department.
(4) An acquisition may become effective prior to the expiration of the
thirty-day period if the director issues written notice of the director's
approval of such acquisition or the director's intent not to deny the
acquisition.
(5)(a) The director may deny any proposed acquisition if:
(i) The financial condition of any acquiring person is such as might
jeopardize the financial stability of the acquired licensee;
(ii) The character and general fitness of any acquiring person or of any
of the proposed management personnel indicate that the acquired installment
sales licensee or installment loan licensee would not be operated honestly,
fairly, or efficiently within the purposes of the Nebraska Installment Loan and
Sales Act; or
(iii) Any acquiring person neglects, fails, or refuses to furnish all
information required by the department.
(b) The director shall notify the acquiring party in writing of denial of
the acquisition. The notice shall provide a statement of the basis for the
denial.
(c) Within fifteen business days after receipt of written notice of
denial, the acquiring party may make a written request for a hearing on the
proposed acquisition in accordance with the Administrative Procedure Act and
rules and regulations adopted and promulgated by the department under the
Nebraska Installment Loan and Sales Act. The director shall, by order, approve
or deny the proposed acquisition on the basis of the record made at the
hearing.
If any seller or sales finance company, in the making or collection of an
installment contract, shall, directly or indirectly, contract for, take, or
receive charges in excess of those authorized by the Nebraska Installment Sales
Act except as a result of an accidental and bona fide error such contract shall
be void and uncollectible as to (1) all of the excessive portion of the time-
price differential, (2) the first one thousand dollars of the time-price
differential authorized by section 45-338, and (3) the first four thousand
dollars of the principal of the contract. If any seller or sales finance
company violates any provision of the act, other than the violations described
above, except as a result of an accidental and bona fide error, such
installment contract shall be void and uncollectible as to the first five
hundred dollars of the time-price differential and the first one thousand
dollars of the principal of such contract. If any of such money has been paid
by the buyer, such buyer or his or her assignee may recover under the act in a
civil suit brought within one year after the due date, or any extension
thereof, of the last installment of the contract.
Sec. 66. Section 45-345, Reissue Revised Statutes of Nebraska, is amended
to read:
45-345 (1) A licensee shall notify the director through the Nationwide
Mortgage Licensing System and Registry at least thirty days prior to the
occurrence of any change of the licensee's name, trade name, or doing business
as designation.
(2)(a) Except as provided in subdivisions (b) and (c) of this subsection,
a licensee shall notify the director in writing or through the Nationwide
Mortgage Licensing System and Registry within three business days from the time
that the licensee becomes aware of any breach of the security of the system of
computerized data owned or licensed by the licensee, which contains personal
information about a Nebraska resident, or the unauthorized access to or use of
such information about a Nebraska resident as a result of the breach.
(b) If a licensee would be required under Nebraska law to provide
notification to a Nebraska resident regarding such incident, then the licensee
shall provide a copy of such notification to the department prior to or
simultaneously with the licensee's notification to the Nebraska resident.
(c) Notice required by this subsection may be delayed if a law enforcement
agency determines that the notice will impede a criminal investigation. Notice
shall be made in good faith, without unreasonable delay, and as soon as
possible after the law enforcement agency determines that notification will no
longer impede the investigation.
(d) For purposes of this subsection, the terms breach of the security of
the system and personal information have the same meaning as in section 87-802.
(3) A licensee shall maintain the minimum net worth required by section
45-337 while a license issued to the licensee under the Nebraska Installment
Loan and Sales Act is in effect. The minimum net worth shall be proven by an
annual audit conducted by a certified public accountant. A licensee shall
submit a copy of the annual audit to the director as required by section 45-337
or upon written request of the director. If a licensee fails to maintain the
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required minimum net worth, the department may issue a notice of cancellation
of the license in lieu of revocation proceedings.
(4)(a) Every licensee shall, at the time any loan is made, give to the
borrower, or if there are two or more borrowers, to one of the borrowers, a
statement in the English language disclosing in clear and distinct terms the
information required to be disclosed under the federal Consumer Credit
Protection Act.
(b) The licensee shall also give to the borrower a copy of any writing
evidencing a loan if the writing requires or provides for the signature of the
borrower. The writing evidencing the borrower's obligation to pay a loan shall
contain a clear and conspicuous notice in form and content substantially as
follows:
NOTICE TO CONSUMER: 1. Do not sign this paper before you read it. 2. You
are entitled to a copy of this paper. 3. You may prepay the unpaid balance at
any time without penalty and may be entitled to receive a refund of unearned
charges in accordance with law.
(5) All licensees under the Nebraska Installment Loan and Sales Act shall,
on or before March 1 of each year, file with the department a report of the
licensee's earnings and operations for the preceding calendar year, the
licensee's assets at the end of the year, and any other relevant information as
the department may reasonably require. The report shall be made under oath and
shall be in the form and manner prescribed by the department.
(6) All installment loan licensees shall submit a mortgage report of
condition as required by section 45-726 on or before a date or dates
established by rule, regulation, or order of the director.
(7) Upon written request of a borrower, the licensee shall provide a
written statement of the dates and amounts of payments made and the amounts of
any default and deferment charges assessed preceding the month in which the
request is received and the total amount unpaid as of the end of the period
covered by the statement and a copy of the loan agreement and security
agreement, and a facsimile of any insurance certificate issued as part of the
transaction, if applicable. The licensee may charge a reasonable fee for such
copies, not to exceed fifty cents per page.
(8) A licensee shall answer in writing, within ten business days after
receipt, any written request for payoff information from a borrower or a
borrower's representative. This service shall be provided without charge to the
borrower, except that when such information is provided upon request within
sixty days after the fulfillment of a previous request, a processing fee of up
to ten dollars may be charged for the subsequent request.
(1) No person shall act as a sales finance company in this state without
obtaining a license therefor from the department as provided in the Nebraska
Installment Sales Act whether or not such person maintains an office, place of
doing business, or agent in this state, unless such person meets the
requirements of section 45-340.
(2) No financial institution or installment loan licensee authorized to do
business in this state shall be required to obtain a license under the act but
shall comply with all of the other provisions of the act.
(3) A seller who does not otherwise act as a sales finance company shall
not be required to obtain a license under the act but shall comply with all of
the other provisions of the act in order to charge the time-price differential
allowed by section 45-338.
Sec. 67. Section 45-346, Revised Statutes Cumulative Supplement, 2024, is
amended to read:
45-346 (1) The department shall be charged with the duty of inspecting the
business, records, and accounts of all persons who engage in business
activities requiring a license under the Nebraska Installment Loan and Sales
Act. The department may examine or investigate complaints about or reports of
alleged violations by a licensee made to the department. The director shall
have the power to appoint examiners who shall, under the director's direction,
investigate the installment sales contracts, installment loans, and business
and examine the books and records of licensees when the director shall so
determine. Such examinations shall be conducted as often as determined by the
director.
(2) The director or the director's duly authorized representative shall
have the power to make such investigations as the director or authorized
representative shall deem necessary, and to the extent necessary for this
purpose, the director or authorized representative may examine a licensee or
any other person and shall have the power to compel the production of all
relevant books, records, accounts, and documents.
(3) The expenses of the director incurred in the examination of the books
and records of licensees shall be charged to the licensees as set forth in
sections 8-605 and 8-606. The director may charge the costs of an investigation
of a nonlicensed person to such person, and such costs shall be paid within
thirty days after receipt of billing.
(4) Upon receipt by a licensee of a notice of investigation or inquiry
request for information from the department, the licensee shall respond within
twenty-one calendar days. Each day a licensee fails to respond as required by
this subsection shall constitute a separate violation.
(5) If the director finds, after notice and opportunity for hearing in
accordance with the Administrative Procedure Act, that any person has willfully
and intentionally violated any provision of the Nebraska Installment Loan and
Sales Act, any rule or regulation adopted and promulgated under the Nebraska
Installment Loan and Sales Act, or any order issued by the director under the
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Nebraska Installment Loan and Sales Act, the director may order such person to
pay (a) an administrative fine of not more than five thousand dollars for each
separate violation and (b) the costs of investigation. The department shall
remit fines collected under this subsection to the State Treasurer for
distribution in accordance with Article VII, section 5, of the Constitution of
Nebraska.
(6) If a person fails to pay an administrative fine and the costs of
investigation ordered pursuant to subsection (5) of this section, a lien in the
amount of such fine and costs may be imposed upon all assets and property of
such person in this state and may be recovered in a civil action by the
director. The lien shall attach to the real property of such person when notice
of the lien is filed and indexed against the real property in the office of the
register of deeds in the county where the real property is located. The lien
shall attach to any other property of such person when notice of the lien is
filed against the property in the manner prescribed by law. Failure of the
person to pay such fine and costs shall constitute a separate violation of the
Nebraska Installment Loan and Sales Act.
(1) A license issued under the Nebraska Installment Sales Act is
nontransferable and nonassignable. The same person may obtain additional
licenses for each place of business operating as a sales finance company in
this state upon compliance with the act as to each license, except that on or
after January 1, 2020, a person is no longer required to obtain a new license
for each place of business and may maintain a branch office or offices upon
compliance with the act.
(2) Application for a license shall be on a form prescribed and furnished
by the director and shall include, but not be limited to, (a) the applicant's
name and any trade name or doing business as designation which the applicant
intends to use in this state, (b) the applicant's main office address, (c) all
branch office addresses at which business is to be conducted, (d) the names and
titles of each director and principal officer of the applicant, (e) the names
of all shareholders, partners, or members of the applicant, (f) a description
of the activities of the applicant in such detail as the department may
require, (g) if the applicant is an individual, his or her social security
number, (h) audited financial statements showing a minimum net worth of one
hundred thousand dollars, and (i) background checks as provided in section
45-354.
(3) An applicant for a license shall file with the department a surety
bond in the amount of fifty thousand dollars, furnished by a surety company
authorized to do business in this state. Such bond shall be increased by an
additional fifty thousand dollars for each branch location of the applicant
that is licensed under the Nebraska Installment Sales Act. The bond shall be
for the use of the State of Nebraska and any Nebraska resident who may have
claims or causes of action against the applicant. The surety may cancel the
bond only upon thirty days' written notice to the director.
(4) A license fee of one hundred fifty dollars, and, if applicable, a one-
hundred-dollar fee for each branch office listed in the application, and any
processing fee allowed under subsection (2) of section 45-354 shall be
submitted along with each application.
(5) An initial license shall remain in full force and effect until the
next succeeding December 31. Each license shall remain in force until revoked,
suspended, canceled, expired, or surrendered.
(6) The director shall, after an application has been filed for a license
under the act, investigate the facts, and if he or she finds that the
experience, character, and general fitness of the applicant, of the members
thereof if the applicant is a corporation or association, and of the officers
and directors thereof if the applicant is a corporation, are such as to warrant
belief that the business will be operated honestly, fairly, and efficiently
within the purpose of the act, the director shall issue and deliver a license
to the applicant to do business as a sales finance company in accordance with
the license and the act. The director shall have the power to reject for cause
any application for a license.
(7) The director shall, within his or her discretion, make an examination
and inspection concerning the propriety of the issuance of a license to any
applicant. The cost of such examination and inspection shall be borne by the
applicant.
(8) If an applicant for a license under the act does not complete the
license application and fails to respond to a notice or notices from the
department to correct the deficiency or deficiencies for a period of one
hundred twenty days or more after the date the department sends the initial
notice to correct the deficiency or deficiencies, the department may deem the
application as abandoned and may issue a notice of abandonment of the
application to the applicant in lieu of proceedings to deny the application.
Sec. 68. Section 45-347, Reissue Revised Statutes of Nebraska, is amended
to read:
45-347 The payment in money, credit, goods, or things in action, as
consideration for any sale or assignment of, or order for, the payment of
wages, salary, commission, or other compensation for services, whether earned
or to be earned, shall, for purposes of regulation under the Nebraska
Installment Loan and Sales Act, be deemed a loan secured by such assignment,
and the amount by which the assigned compensation exceeds the amount of the
consideration actually paid, shall, for the purposes of regulation under the
act, be deemed interest or charges upon the loan from the date of payment to
the date the compensation is payable. Such transaction shall be governed by and
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be subject to the act.
All money collected under the authority of the Nebraska Installment Sales
Act shall be remitted to the State Treasurer for credit to the Financial
Institution Assessment Cash Fund.
Sec. 69. Section 45-348, Reissue Revised Statutes of Nebraska, is amended
to read:
45-348 Every installment loan licensee shall permit payment to be made in
advance in any amount equal to one or more full installments on any loan
contract at any time during regular business hours, but the licensee may apply
such payment first to all accrued charges in full up to the date of such
payment.
(1) An installment sales license may be renewed annually on or before
December 31 by paying to the director a fee of one hundred fifty dollars, plus
one hundred dollars for each branch office, if applicable, and any processing
fee allowed under subsection (2) of section 45-354 and by submitting such
information as the director may require to indicate any material change in the
information contained in the original application or succeeding renewal
applications, including a copy of the licensee's most recent annual audit.
(2) A licensee may voluntarily surrender a license at any time by
delivering to the director written notice of the surrender. The department
shall cancel the license following such surrender.
(3) If a licensee fails to renew its license and does not voluntarily
surrender the license pursuant to this section, the department may issue a
notice of expiration of the license to the licensee in lieu of revocation
proceedings.
Sec. 70. (1) Except as provided in section 45-350 and subsection (6) of
this section, every installment loan licensee may make loans and may contract
for and receive on such loans charges at a rate not exceeding twenty-four
percent per annum on that part of the unpaid principal balance on any loan not
in excess of one thousand dollars, and twenty-one percent per annum on any
remainder of such unpaid principal balance. Except for loans secured by mobile
homes, an installment loan licensee may not make loans for a period in excess
of one hundred forty-five months if the amount of the loan is greater than
three thousand dollars but less than twenty-five thousand dollars. Unless
otherwise allowed for by law, charges on loans made under the Nebraska
Installment Loan and Sales Act shall not be paid, deducted, or received in
advance. The contracting for, charging of, or receiving of charges as provided
for in subsection (2) of this section shall not be deemed to be the payment,
deduction, or receipt of such charges in advance.
(2) When the loan contract requires repayment in substantially equal and
consecutive monthly installments of principal and charges combined, the
installment loan licensee may, at the time the loan is made, precompute the
charges at the agreed rate on scheduled unpaid principal balances according to
the terms of the contract and add such charges to the principal of the loan.
Every payment may be applied to the combined total of principal and precomputed
charges until the contract is fully paid. All payments made on account of any
loan except for default and deferment charges shall be deemed to be applied to
the unpaid installments in the order in which the unpaid installments are due.
The portion of the precomputed charges applicable to any particular month of
the contract, as originally scheduled or following a deferment, shall be that
proportion of such precomputed charges, excluding any adjustment made for a
first installment period of more than one month and any adjustment made for
deferment, which the balance of the contract scheduled to be outstanding during
such month bears to the sum of all monthly balances originally scheduled to be
outstanding by the contract. This section shall not limit or restrict the
manner of calculating charges, whether by way of add-on, single annual rate, or
otherwise, if the rate of charges does not exceed what is permitted by this
section. Charges may be contracted for and earned at a single annual rate,
except that the total charges from such rate shall not be greater than the
total charges from the several rates otherwise applicable to the different
portions of the unpaid balance according to subsection (1) of this section. All
loan contracts made pursuant to this subsection are subject to the following
adjustments:
(a) Notwithstanding the requirement for substantially equal and
consecutive monthly installments, the first installment period may not exceed
one month by more than twenty-one days and may not fall short of one month by
more than eleven days. The charges for each day exceeding one month shall be
one-thirtieth of the charges which would be applicable to a first installment
period of one month. The charge for extra days in the first installment period
may be added to the first installment and such charges for such extra days
shall be excluded in computing any rebate;
(b) If prepayment in full by cash, a new loan, or otherwise occurs before
the first installment due date, the charges shall be recomputed at the rate of
charges contracted for in accordance with this section upon the actual unpaid
principal balance of the loan for the actual time outstanding by applying the
payment, or payments, first to charges at the agreed rate and the remainder to
the principal. The amount of charges so computed shall be retained in lieu of
all precomputed charges;
(c) If a contract is prepaid in full by cash, a new loan, or otherwise
after the first installment due date, the borrower shall receive a rebate of an
amount which is not less than the amount obtained by applying to the unpaid
principal balances as originally scheduled or, if deferred, as deferred, for
the period following prepayment, according to the actuarial method, the rate of
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charge contracted for in accordance with this section. The licensee may round
the rate of charge to the nearest one-half of one percent if such procedure is
not consistently used to obtain a greater yield than would otherwise be
permitted. Any default and deferment charges which are due and unpaid may be
deducted from any rebate. No rebate shall be required for any partial
prepayment. No rebate of less than one dollar need be made. Acceleration of the
maturity of the contract shall not in itself require a rebate. If judgment is
obtained before the final installment date, the contract balance shall be
reduced by the rebate which would be required for prepayment in full as of the
date judgment is obtained;
(d) If any installment on a precomputed or interest-bearing loan is unpaid
in full for ten or more consecutive days, Sundays and holidays included, after
it is due, the licensee may charge and collect a default charge not exceeding
an amount equal to five percent of such installment. If any installment payment
is made by a check, draft, or similar signed order which is not honored because
of insufficient funds, no account, or any other reason except an error of a
third party to the loan contract, the licensee may charge and collect a
fifteen-dollar bad check charge. Such default or bad check charges may be
collected when due or at any time thereafter;
(e) If, as of an installment due date, the payment date of all wholly
unpaid installments is deferred one or more full months and the maturity of the
contract is extended for a corresponding period, the licensee may charge and
collect a deferment charge not exceeding the charge applicable to the first of
the installments deferred, multiplied by the number of months in the deferment
period. The deferment period is that period during which no payment is made or
required by reason of such deferment. The deferment charge may be collected at
the time of deferment or at any time thereafter. The portion of the precomputed
charges applicable to each deferred balance and installment period following
the deferment period shall remain the same as that applicable to such balance
and periods under the original loan contract. No installment on which a default
charge has been collected, or on account of which any partial payment has been
made, shall be deferred or included in the computation of the deferment charge
unless such default charge or partial payment is refunded to the borrower or
credited to the deferment charge. Any payment received at the time of deferment
may be applied first to the deferment charge and the remainder, if any, applied
to the unpaid balance of the contract, except that if such payment is
sufficient to pay, in addition to the appropriate deferment charge, any
installment which is in default and the applicable default charge, it shall be
first so applied and any such installment shall not be deferred or subject to
the deferment charge. If a loan is prepaid in full during the deferment period,
the borrower shall receive, in addition to the required rebate, a rebate of
that portion of the deferment charge applicable to any unexpired full month or
months of such deferment period; and
(f) If two or more full installments are in default for one full month or
more at any installment date and if the contract so provides, the installment
loan licensee may reduce the contract balance by the rebate which would be
required for prepayment in full as of such installment date and the amount
remaining unpaid shall be deemed to be the unpaid principal balance and
thereafter in lieu of charging, collecting, receiving, and applying charges as
provided in this subsection, charges may be charged, collected, received, and
applied at the agreed rate as otherwise provided by this section until the loan
is fully paid.
(3) The charges, as referred to in subsection (1) of this section, shall
not be compounded. The charging, collecting, and receiving of charges as
provided in subsection (2) of this section shall not be deemed compounding. If
part or all of the consideration for a loan contract is the unpaid principal
balance of a prior loan, then the principal amount payable under such loan
contract may include any unpaid charges on the prior loan which have accrued
within sixty days before the making of such loan contract and may include the
balance remaining after giving the rebate required by subsection (2) of this
section. Except as provided in subsection (2) of this section, charges shall
(a) be computed and paid only as a percentage per month of the unpaid principal
balance or portions thereof and (b) be computed on the basis of the number of
days actually elapsed. For purposes of computing charges, whether at the
maximum rate or less, a month shall be that period of time from any date in a
month to the corresponding date in the next month but if there is no such
corresponding date then to the last day of the next month, and a day shall be
considered one-thirtieth of a month when computation is made for a fraction of
a month.
(4) Except as provided in subsections (5) and (6) of this section, in
addition to that provided for under the Nebraska Installment Loan and Sales
Act, no further or other amount whatsoever shall be directly or indirectly
charged, contracted for, or received. If any amount, in excess of the charges
permitted, is charged, contracted for, or received, the loan contract shall not
on that account be void, but the installment loan licensee shall have no right
to collect or receive any interest or other charges whatsoever. If such
interest or other charges have been collected or contracted for, the licensee
shall refund to the borrower all interest and other charges collected and shall
not collect any interest or other charges contracted for and thereafter due on
the loan involved, as liquidated damages, and the installment loan licensee or
its assignee, if found liable, shall pay the costs of any action relating
thereto, including reasonable attorney's fees. No installment loan licensee
shall be found liable under this subsection if it shows by a preponderance of
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the evidence that the violation was not intentional and resulted from a bona
fide error notwithstanding the maintenance of procedures reasonably adopted to
avoid any such error.
(5) A borrower may be required to pay all reasonable expenses incurred in
connection with the making, closing, disbursing, extending, readjusting, or
renewing of loans. Such expenses may include abstracting, recording, releasing,
and registration fees; premiums paid for nonfiling insurance; premiums paid on
insurance policies covering tangible personal property securing the loan;
amounts charged for a debt cancellation contract or a debt suspension contract,
as agreed upon by the parties, if the debt cancellation contract or debt
suspension contract is a contract of a financial institution or installment
loan licensee and such contract is sold directly by such financial institution
or licensee or by an unaffiliated, nonexclusive agent of such financial
institution or licensee in accordance with 12 C.F.R. part 37, as such part
existed on January 1, 2025, and the financial institution or installment loan
licensee is responsible for the unaffiliated, nonexclusive agent's compliance
with such part; title examinations; credit reports; survey; taxes or charges
imposed upon or in connection with the making and recording or releasing of any
mortgage; amounts charged for a guaranteed asset protection waiver; and fees
and expenses charged for electronic title and lien services. Except as provided
in subsection (6) of this section, a borrower may also be required to pay a
nonrefundable loan origination fee not to exceed the lesser of five hundred
dollars or an amount equal to seven percent of that part of the original
principal balance of any loan not in excess of two thousand dollars and five
percent on that part of the original principal balance in excess of two
thousand dollars, if the installment loan licensee has not made another loan to
the borrower within the previous twelve months. If the licensee has made
another loan to the borrower within the previous twelve months, a nonrefundable
loan origination fee may only be charged on new funds advanced on each
successive loan. Such reasonable initial charges may be collected from the
borrower or included in the principal balance of the loan at the time the loan
is made and shall not be considered interest or a charge for the use of the
money loaned.
(6)(a) Loans secured solely by real property that are not made pursuant to
subdivision (11) of section 45-101.04 on real property shall not be subject to
the limitations on the rate of interest provided in subsection (1) of this
section or the limitations on the nonrefundable loan origination fee under
subsection (5) of this section if (i) the principal amount of the loan is seven
thousand five hundred dollars or more and (ii) the sum of the principal amount
of the loan and the balances of all other liens against the property do not
exceed one hundred percent of the appraised value of the property. Acceptable
methods of determining appraised value shall be made by the department pursuant
to rule, regulation, or order.
(b) An origination fee on such loan shall be computed only on the
principal amount of the loan reduced by any portion of the principal that
consists of the amount required to pay off another loan made under this
subsection by the same licensee.
(c) A prepayment penalty on such loan shall be permitted only if (i) the
maximum amount of the penalty to be assessed is stated in writing at the time
the loan is made, (ii) the loan is prepaid in full within two years from the
date of the loan, and (iii) the loan is prepaid with money other than the
proceeds of another loan made by the same licensee. Such prepayment penalty
shall not exceed six months' interest on eighty percent of the original
principal balance computed at the agreed rate of interest on the loan.
(d) An installment loan licensee making a loan pursuant to this subsection
may obtain an interest in any fixtures attached to such real property and any
insurance proceeds payable in connection with such real property or the loan.
(e) For purposes of this subsection, principal amount of the loan means
the total sum owed by the borrower including, but not limited to, insurance
premiums, loan origination fees, or any other amount that is financed, except
that for purposes of subdivision (6)(b) of this section, loan origination fees
shall not be included in calculating the principal amount of the loan.
Sec. 71. Section 45-350, Reissue Revised Statutes of Nebraska, is amended
to read:
45-350 (1) Installment loan licensees may charge, contract for, or receive
any amount or rate of interest permitted by section 45-101.03 or 45-101.04 or
section 70 of this act upon any loan or upon any part or all of any aggregate
indebtedness of the same person. Except as provided in subsection (2) of this
section, the charging, contracting for, or receiving of a rate of interest
permitted by section 45-101.04 does not exempt the licensee from compliance
with the Nebraska Installment Loan and Sales Act.
(2)(a) Loans made by an installment loan licensee pursuant to subdivision
(4) of section 45-101.04 are not subject to the Nebraska Installment Loan and
Sales Act if such loans are not made on real property.
(b) Loans made by an installment loan licensee pursuant to subdivision
(11) of section 45-101.04 on real property are not subject to the Nebraska
Installment Loan and Sales Act. An installment loan licensee making such loans
shall comply with and be subject to the Residential Mortgage Licensing Act with
respect to such loans, except that the installment loan licensee shall not be
required to obtain a mortgage banker license under the Residential Mortgage
Licensing Act.
(c) Any mortgage loan originator who works as an employee or independent
agent of an installment loan licensee shall be required to obtain a mortgage
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loan originator license and shall be subject to the Residential Mortgage
Licensing Act.
(3) Except as provided in subdivision (2)(a) of section 70 of this act, no
installment loan licensee shall enter into any loan contract under the Nebraska
Installment Loan and Sales Act under which the borrower agrees to make any
payment of principal more than thirty-six calendar months from the date of
making such contract when the principal balance is not more than three thousand
dollars. Every loan contract precomputed pursuant to subsection (2) of section
70 of this act shall provide for repayment of principal and charges in
installments which shall be payable at approximately equal periodic intervals
of time and so arranged that no installment is substantially greater in amount
than any preceding installment. When necessary in order to facilitate payment
in accordance with the borrower's principal source of income or when the loan
contract is not precomputed pursuant to subsection (2) of section 70 of this
act, the payment schedule may reduce or omit installment payments. Any loan
contract made in violation of this section, either knowingly or without the
exercise of due care to prevent the violation, shall not on that account be
void, but the licensee has no right to collect or receive any interest or
charges on such loan. If any interest or other charges have been collected or
contracted for, the installment loan licensee shall refund to the borrower all
interest and other charges collected and shall not collect thereafter any
interest or other charges contracted for and thereafter due on the loan
involved, as liquidated damages, and the installment loan licensee or its
assignee, if found liable, shall pay the costs of any action relating thereto,
including reasonable attorney's fees. No installment loan licensee shall be
found liable under this subsection if it shows by a preponderance of the
evidence that the violation was not intentional and resulted from a bona fide
error notwithstanding the maintenance of procedures reasonably adopted to avoid
any such error.
(1) Renewal of a license originally granted under the Nebraska Installment
Sales Act may be denied or a license may be suspended or revoked by the
director on the following grounds: (a) Material misstatement in the application
for license; (b) willful failure to comply with any provision of the Nebraska
Installment Sales Act relating to installment contracts; (c) defrauding any
buyer to the buyer's damage; or (d) fraudulent misrepresentation,
circumvention, or concealment by the licensee through whatever subterfuge or
device of any of the material particulars or the nature thereof required to be
stated or furnished to the buyer under the Nebraska Installment Sales Act.
(2) If a licensee is a partnership, limited liability company,
association, or corporation, it shall be sufficient cause for the suspension or
revocation of a license that any officer, director, or trustee of a licensed
association or corporation or any member of a licensed partnership or limited
liability company has so acted or failed to act as would be cause for
suspending or revoking a license to such party as an individual.
(3) No license shall be denied, suspended, or revoked except after hearing
in accordance with the Administrative Procedure Act. The director shall give
the licensee at least ten days' written notice, in the form of an order to show
cause, of the time and place of such hearing by either registered or certified
mail addressed to the principal place of business in this state of such
licensee. Such notice shall contain the grounds of complaint against the
licensee. Any order suspending or revoking such license shall recite the
grounds upon which the same is based. The order shall be entered upon the
records of the director and shall not be effective until after thirty days'
written notice thereof given after such entry forwarded by either registered or
certified mail to the licensee at such principal place of business.
(4) Revocation, suspension, cancellation, expiration, or surrender of any
license shall not impair or affect the obligation of any lawful installment
contract acquired previously thereto by the licensee.
(5) Revocation, suspension, cancellation, expiration, or surrender of any
license shall not affect civil or criminal liability for acts committed before
the revocation, suspension, cancellation, expiration, or surrender or affect
liability for any fines which may be levied against the licensee or any of its
officers, directors, shareholders, partners, or members pursuant to the
Nebraska Installment Sales Act for acts committed before the revocation,
suspension, cancellation, expiration, or surrender.
(6) Any person, licensee, or applicant considering himself or herself
aggrieved by an order of the director entered under the provisions of this
section may appeal the order. The appeal shall be in accordance with the
Administrative Procedure Act.
Sec. 72. Section 45-351, Reissue Revised Statutes of Nebraska, is amended
to read:
45-351 (1) Except as otherwise provided by the Nebraska Installment Loan
and Sales Act or other law, an installment loan licensee shall not contact any
individual who is not living, residing, or present in the household of the
borrower regarding the borrower's obligation to pay a debt, other than the
borrower's spouse, the borrower's attorney, another creditor, or a credit
reporting agency.
(2) The borrower may waive the benefits of this section at any time by
giving consent if such consent is given at a time subsequent to the date the
debt arises.
(1) The department shall be charged with the duty of inspecting the
business, records, and accounts of all persons who engage in the business of a
sales finance company subject to the Nebraska Installment Sales Act. The
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director shall have the power to appoint examiners who shall, under his or her
direction, investigate the installment contracts and business and examine the
books and records of licensees when the director shall so determine. Such
examinations shall not be conducted more often than annually except as provided
in subsection (2) of this section.
(2) The director or his or her duly authorized representative shall have
the power to make such investigations as he or she shall deem necessary, and to
the extent necessary for this purpose, he or she may examine such licensee or
any other person and shall have the power to compel the production of all
relevant books, records, accounts, and documents.
(3) The expenses of the director incurred in the examination of the books
and records of licensees shall be charged to the licensees as set forth in
sections 8-605 and 8-606. The director may charge the costs of an investigation
of a nonlicensed person to such person, and such costs shall be paid within
thirty days after receipt of billing.
(4) Upon receipt by a licensee of a notice of investigation or inquiry
request for information from the department, the licensee shall respond within
twenty-one calendar days. Each day a licensee fails to respond as required by
this subsection shall constitute a separate violation.
(5) If the director finds, after notice and opportunity for hearing in
accordance with the Administrative Procedure Act, that any person has willfully
and intentionally violated any provision of the Nebraska Installment Sales Act,
any rule or regulation adopted and promulgated under the act, or any order
issued by the director under the act, the director may order such person to pay
(a) an administrative fine of not more than one thousand dollars for each
separate violation and (b) the costs of investigation. The department shall
remit fines collected under this subsection to the State Treasurer for
distribution in accordance with Article VII, section 5, of the Constitution of
Nebraska.
(6) If a person fails to pay an administrative fine and the costs of
investigation ordered pursuant to subsection (5) of this section, a lien in the
amount of such fine and costs may be imposed upon all assets and property of
such person in this state and may be recovered in a civil action by the
director. The lien shall attach to the real property of such person when notice
of the lien is filed and indexed against the real property in the office of the
register of deeds in the county where the real property is located. The lien
shall attach to any other property of such person when notice of the lien is
filed against the property in the manner prescribed by law. Failure of the
person to pay such fine and costs shall constitute a separate violation of the
Nebraska Installment Sales Act.
Sec. 73. Section 45-352, Reissue Revised Statutes of Nebraska, is amended
to read:
45-352 (1) Section 45-351 shall not prohibit the licensee from:
(a) Contacting any person in order to discover property belonging to the
borrower that may be seized to satisfy a debt that has been reduced to
judgment;
(b) Making amicable demand and filing suit on the debt; or
(c) Contacting persons related to the borrower if permission is
specifically given in writing at the time the debt arises or at any time after
such debt arises.
(2) An installment loan licensee may contact any person without the
borrower's consent:
(a) To ascertain information relating to a borrower's credit worthiness,
credit standing, credit capacity, character, general reputation, personal
characteristics, or mode of living which is used or expected to be used or
collected in whole or in part for the purpose of serving as a factor in
establishing the borrower's eligibility for credit or insurance if such
contacts are not designed to collect a delinquent debt; or
(b) To locate the borrower when the licensee has reason to believe the
borrower has changed his or her employment or has moved from his or her last-
known address.
The director shall have the power to make such general rules and
regulations and specific rulings, demands, and findings as may be necessary for
the proper conduct of the business licensed under the Nebraska Installment
Sales Act, and the enforcement of the act, in addition thereto and not
inconsistent therewith.
Sec. 74. Section 45-353, Reissue Revised Statutes of Nebraska, is amended
to read:
45-353 (1) An agreement of the parties to a loan, with respect to default
on the part of the borrower, is enforceable only to the extent that:
(a) The borrower fails to make a payment on the loan or other charges
required by the agreement; or
(b) The prospect of payment, performance, or realization of collateral is
significantly impaired. The burden of establishing the prospect of significant
impairment is on the installment loan licensee.
(2) If the borrower has defaulted on his or her promise to pay and if he
or she has given specific notice in writing, by registered or certified mail,
instructing the licensee to cease further contacts with the borrower in regard
to the indebtedness, the installment loan licensee shall, after such notice,
except as provided in section 45-352, limit contacts to one notice per month by
mail. No notice shall be designed to threaten action not otherwise permitted by
law.
(3) With respect to a loan, after a borrower has been in default for ten
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days for failure to make a required payment, an installment loan licensee may
give the borrower the notice described in this section. An installment loan
licensee gives notice to the borrower under this section when it delivers the
notice to the borrower or delivers or mails the notice to the last-known
address of the borrower's residence.
(4) The notice shall be in writing and shall conspicuously state:
(a) The name, address, and telephone number of the installment loan
licensee to which payment is to be made;
(b) A brief identification of the loan;
(c) The borrower's right to cure the default;
(d) The amount of payment and date by which payment must be made to cure
the default; and
(e) That any credit insurance issued in connection with the loan contract
may be canceled unless the borrower cures the default.
(5) With respect to a loan, after a default consisting only of the
borrower's failure to make a required payment, an installment loan licensee may
neither accelerate maturity of the unpaid balance of the obligation nor take
possession of collateral, except voluntarily surrendered collateral, because of
such default until twenty days after a notice of the borrower's right to cure
is given. The borrower shall have twenty days after the notice is given to cure
any default 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 charges. Cure restores the borrower to his or her
rights under the agreement as though the default had not occurred.
(6) With respect to defaults on the same obligation after an installment
loan licensee has once given a notice of the borrower's right to cure, the
borrower shall have no further right to cure and the installment loan licensee
has no obligation to proceed against the borrower or the collateral.
(7) Upon default by a borrower with respect to a loan, unless the borrower
voluntarily surrenders possession of the collateral to the licensee, the
licensee may take possession of the collateral without judicial process only if
possession can be taken without entry into a dwelling or a locked, unoccupied
motor vehicle, and without the use of force or other breach of the peace.
(1) Whenever the director has reasonable cause to believe that any person
is violating or is threatening to or intends to violate any of the provisions
of the Nebraska Installment Sales Act, he or she may, in addition to all
actions provided for in the act and without prejudice thereto, enter an order
requiring such person to desist or to refrain from such violation. An action
may also be brought, on the relation of the Attorney General or the director,
to enjoin such person from engaging in or continuing such violation or from
doing any act or acts in furtherance thereof.
(2) In any such action an order or judgment may be entered awarding such
preliminary or final injunction as may be deemed proper. In addition to all
other means provided by law for the enforcement of a restraining order or
injunction, the court, in which such action is brought, shall have power and
jurisdiction to impound and appoint a receiver for the property and business of
the defendant, including books, papers, documents, and records pertaining
thereto or so much thereof as the court may deem reasonably necessary to
prevent violations of the Nebraska Installment Sales Act through or by means of
the use of such property and business. Such receiver, when so appointed and
qualified, shall have such powers and duties as to custody, collection,
administration, winding up and liquidation of such property and business as
shall, from time to time, be conferred upon him or her by the court.
Sec. 75. Section 45-354, Revised Statutes Cumulative Supplement, 2024, is
amended to read:
45-354 (1) A borrower is not liable for a deficiency unless the licensee
has disposed of the collateral in good faith and in a commercially reasonable
manner.
(2) If the installment loan licensee takes possession or voluntarily
accepts surrender of goods in which the licensee has a security interest to
secure a loan and at the time thereof the unpaid balance due on the loan is
three thousand dollars or less, the borrower is not personally liable to the
installment loan licensee for the unpaid balance of the debt arising from the
loan and the licensee's duty to dispose of the collateral is governed by the
provisions on disposition of collateral, article 9, Uniform Commercial Code.
(3) The borrower may be liable in damages to the installment loan licensee
if the borrower has wrongfully damaged the collateral or if, after default,
failure to cure, and demand, the borrower has wrongfully failed to make the
collateral available to the installment loan licensee.
(4) If the installment loan licensee elects to bring an action against the
borrower for a debt arising from a loan, when under this section the
installment loan licensee would not be entitled to a deficiency judgment if the
installment loan licensee took possession of the collateral, and obtains
judgment, (a) the installment loan licensee 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.
(1) Effective January 1, 2013, or within one hundred eighty days after the
Nationwide Mortgage Licensing System and Registry is capable of accepting
licenses issued under the Nebraska Installment Sales Act, whichever is later,
the department shall require such licensees under the act to be licensed and
registered through the Nationwide Mortgage Licensing System and Registry. In
order to carry out this requirement, the department is authorized to
participate in the Nationwide Mortgage Licensing System and Registry. For this
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purpose, the department may establish, by adopting and promulgating rules and
regulations or by order, requirements as necessary. The requirements may
include, but not be limited to:
(a) Background checks of applicants and licensees, including, but not
limited to:
(i) Fingerprints of every executive officer, director, partner, member,
sole proprietor, or shareholder submitted to the Federal Bureau of
Investigation and any other governmental agency or entity authorized to receive
such information for a state, national, and international criminal history
record information check;
(ii) Civil or administrative records;
(iii) Credit history; or
(iv) Any other information as deemed necessary by the Nationwide Mortgage
Licensing System and Registry;
(b) The payment of fees to apply for or renew a license through the
Nationwide Mortgage Licensing System and Registry;
(c) Compliance with prelicensure education and testing and continuing
education;
(d) The setting or resetting, as necessary, of renewal processing or
reporting dates; and
(e) Amending or surrendering a license or any other such activities as the
director deems necessary for participation in the Nationwide Mortgage Licensing
System and Registry.
(2) In order to fulfill the purposes of the Nebraska Installment Sales
Act, the department is authorized to establish relationships or contracts with
the Nationwide Mortgage Licensing System and Registry or other entities
designated by the Nationwide Mortgage Licensing System and Registry to collect
and maintain records and process transaction fees or other fees related to
licensees or other persons subject to the act. The department may allow such
system to collect licensing fees on behalf of the department and allow such
system to collect a processing fee for the services of the system directly from
each licensee or applicant for a license.
(3) The director is required to regularly report enforcement actions and
other relevant information to the Nationwide Mortgage Licensing System and
Registry subject to the provisions contained in section 45-355.
(4) The director shall establish a process whereby applicants and
licensees may challenge information entered into the Nationwide Mortgage
Licensing System and Registry by the director.
(5) The department shall ensure that the Nationwide Mortgage Licensing
System and Registry adopts a privacy, data security, and breach of security of
the system notification policy. The director shall make available upon written
request a copy of the contract between the department and the Nationwide
Mortgage Licensing System and Registry pertaining to the breach of security of
the system provisions.
(6) The department shall upon written request provide the most recently
available audited financial report of the Nationwide Mortgage Licensing System
and Registry.
(7) The director may use the Nationwide Mortgage Licensing System and
Registry as a channeling agent for requesting information from and distributing
information to the United States Department of Justice or any other
governmental agency in order to reduce the points of contact which the Federal
Bureau of Investigation may have to maintain for purposes of subsection (1) of
this section.
Sec. 76. Section 45-355, Reissue Revised Statutes of Nebraska, is amended
to read:
45-355 (1) No individual, other than the spouse of the borrower, is
obligated as a cosigner, comaker, guarantor, endorser, surety, or similar party
with respect to a loan unless, before or contemporaneously with signing any
separate agreement of loan or any writing setting forth the terms of the
borrower's agreement, the individual receives a separate written notice that
contains a completed identification of the loan the individual may have to pay
and reasonably informs the individual of the obligation with respect to it.
(2) Such notice shall be in the form prescribed by the department.
(3) An individual entitled to notice under this section shall also be
given a copy of any writing setting forth the terms of the borrower's agreement
and of any separate agreement of obligation signed by the individual entitled
to the notice.
(1) In order to promote more effective regulation and reduce the
regulatory burden through supervisory information sharing:
(a) Except as otherwise provided in this section, the requirements under
any federal or state law regarding the privacy or confidentiality of any
information or material provided to the Nationwide Mortgage Licensing System
and Registry, and any privilege arising under federal or state law, including
the rules of any federal or state court, with respect to such information or
material, shall continue to apply to such information or material after the
information or material has been disclosed to the Nationwide Mortgage Licensing
System and Registry. Such information and material may be shared with all
federal and state regulatory officials with mortgage industry oversight
authority without the loss of privilege or the loss of confidentiality
protections provided by federal or state law;
(b) Information or material that is subject to privilege or
confidentiality under subdivision (a) of this subsection shall not be subject
to:
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(i) Disclosure under any federal or state law governing the disclosure to
the public of information held by an officer or an agency of the federal
government or the respective state; or
(ii) Subpoena or discovery or admission into evidence in any private civil
action or administrative process unless, with respect to any privilege held by
the Nationwide Mortgage Licensing System and Registry with respect to such
information or material, the person to whom such information or material
pertains waives, in whole or in part, in the discretion of such person, that
privilege;
(c) Any state statute relating to the disclosure of confidential
supervisory information or any information or material described in subdivision
(a) of this subsection that is inconsistent with such subdivision shall be
superseded by the requirements of this section; and
(d) This section shall not apply with respect to the information or
material relating to the employment history of, and publicly adjudicated
disciplinary and enforcement actions against, applicants and licensees that is
included in the Nationwide Mortgage Licensing System and Registry for access by
the public.
(2) For these purposes, the director is authorized to enter into
agreements or sharing arrangements with other governmental agencies, the
Conference of State Bank Supervisors, the American Association of Residential
Mortgage Regulators, or other associations representing governmental agencies
as established by adopting and promulgating rules and regulations or an order
of the director.
Sec. 77. Section 45-356, Reissue Revised Statutes of Nebraska, is amended
to read:
45-356 (1) No licensee shall receive any security agreement or assignment
of salary or wages signed in blank. All blank spaces shall be filled in with
ink or typewritten or printed with the proper names and amounts showing the
name of the person by whom the individual making the conveyance or assignment
is employed. No assignment or order for wages is valid if it contains an amount
in excess of the sum borrowed together with the interest and charges as
provided in the Nebraska Installment Loan and Sales Act.
(2) No assignment of or order for wages to secure a loan or advancement is
valid when made by a married man or woman unless the written consent of the
wife or husband to the making of such loan is attached thereto.
(3) No licensee shall take a power of attorney, or any instrument signed
by an attorney in fact and not personally, or any instrument signed in which
blanks are left to be filled after execution.
(1) No person acting personally or as an agent shall acquire control of
any licensee under the Nebraska Installment Sales Act without first (a) giving
thirty days' notice to the department on a form prescribed by the department of
such proposed acquisition and (b) paying a filing fee of one hundred fifty
dollars and any processing fee allowed under subsection (2) of section 45-354.
(2) The director, upon receipt of such notice, shall act upon the
acquisition within thirty days, and unless he or she disapproves of the
proposed acquisition within such period of time, the acquisition shall become
effective on the thirty-first day after receipt without the director's
approval, except that the director may extend the thirty-day period an
additional thirty days if, in his or her judgment, any material information
submitted is substantially inaccurate or the acquiring party has not furnished
all the information required by the department.
(3) An acquisition may become effective prior to the expiration of the
disapproval period if the director issues written notice of his or her intent
not to disapprove the action.
(4)(a) The director may disapprove any proposed acquisition if:
(i) The financial condition of any acquiring person is such as might
jeopardize the financial stability of the acquired licensee;
(ii) The character and general fitness of any acquiring person or of any
of the proposed management personnel indicate that the acquired installment
sales licensee would not be operated honestly, fairly, or efficiently within
the purpose of the Nebraska Installment Sales Act; or
(iii) Any acquiring person neglects, fails, or refuses to furnish all
information required by the department.
(b) The director shall notify the acquiring party in writing of
disapproval of the acquisition. The notice shall provide a statement of the
basis for the disapproval.
(c) Within fifteen business days after receipt of written notice of
disapproval, the acquiring party may make a written request for a hearing on
the proposed acquisition in accordance with the Administrative Procedure Act
and rules and regulations adopted and promulgated by the department under the
Administrative Procedure Act. The director shall, by order, approve or
disapprove the proposed acquisition on the basis of the record made at the
hearing.
Sec. 78. Within thirty days after repayment of the loan in full, the
licensee shall mark plainly every obligation or copy of the obligation and
security or copy of the security signed by any obligor with the word Paid or
Canceled and shall release any mortgage, trust deed, or lien, restore any
pledge, and cancel and return any note or copy of the note and any assignment
or copy of the assignment given to the licensee. For purposes of this section,
a copy shall meet the requirements of section 25-12,112.
Sec. 79. Nothing in sections 45-351 and 45-353 shall limit a borrower's
right to bring an action for damages. When the licensee has filed suit and
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obtained judgment, the licensee shall be permitted to resume contacts with the
borrower against whom judgment has been obtained.
Sec. 80. (1) The following types of insurance or one or more of the
following types of insurance may be written in connection with loans made by
installment loan licensees under the Nebraska Installment Loan and Sales Act:
(a) Fire, theft, windstorm, or comprehensive, including fire, theft, and
windstorm, fifty dollars or more deductible collision, and bodily injury
liability and property damage liability upon motor vehicles;
(b) Fire and extended-coverage insurance upon real property;
(c) Fire and extended-coverage insurance upon tangible personal property,
limited to the principal amount of the loan;
(d) Involuntary unemployment or job protection insurance. In the event of
a renewal of a loan contract, this type of insurance shall be canceled and a
refund of the unearned premium credited or made before new insurance of this
type may be rewritten. Such insurance shall not be required as a condition
precedent to the making of such loan; and
(e) Life, health, and accident insurance or any of them, except that the
amount of such insurance shall not exceed the total amount to be repaid under
the loan contract and the term shall not extend beyond the final maturity date
of the loan contract. In the event of a renewal of a loan contract, this type
of insurance shall be canceled and a refund of the unearned premium credited or
made before new insurance of this type may be written in connection with such
loan. Such insurance shall not be required as a condition precedent to the
making of such loan.
(2) In addition to the types of insurance written under subsection (1) of
this section by licensees under the act, any other type of insurance or motor
club service as defined in section 44-3707 may be provided for the benefit of a
licensee's borrower or the borrower's immediate family whether or not in
connection with a loan, except that such insurance or motor club service shall
not be required as a condition precedent to the making of any loan. Nothing in
this subsection alters or eliminates any insurance licensing requirements or
certificate of authority requirements under the Motor Club Services Act.
(3) Notwithstanding section 70 of this act and section 45-350, any gain or
advantage, in the form of commission or otherwise, to the licensee or to any
employee, affiliate, or associate of the licensee from such insurance or motor
club service or the sale thereof shall not be deemed to be an additional or
further charge in connection with the loan contract. The insurance premium or
motor club service contract fee may be collected from the borrower or financed
through the loan contract at the time the loan is made.
(4)(a) Insurance permitted under this section shall be obtained through a
duly licensed insurance agent, agency, or broker. Premiums shall not exceed
those fixed by law or current applicable manual rates. Insurance written, as
authorized by this section, may contain a mortgage clause or other appropriate
provision to protect the insurable interest of the licensee.
(b) Motor club services permitted under this section shall be obtained
through a motor club which holds a certificate of authority under the Motor
Club Services Act.
(5) In the event of a renewal of a loan contract, any insurance or motor
club service sold pursuant to this section shall be canceled and (a) a refund
of the unearned premium or motor club service contract fee credited or made
before new insurance or motor club service of the same type as that being
canceled may be rewritten or (b) the holder of the loan contract shall send
notice to the buyer within fifteen business days after cancellation of the
name, address, and telephone number of the insurance company or motor club
which issued the insurance contract or motor club service contract or the party
responsible for any refund and notice that the buyer may be eligible for a
refund. A copy of such notice shall be retained by the holder of the loan
contract.
(6) If any insurance or motor club service sold pursuant to this section
is canceled or the premium or motor club service contract fee adjusted during
the term of the loan contract, any refund of the insurance premium or motor
club service contract fee plus the unearned interest thereon received by the
holder shall be credited by the holder to the loan contract or otherwise
refunded, except to the extent applied toward payment for similar insurance or
motor club service protecting the interests of the buyer and the holder or
either of them.
(7) If any insurance or motor club service sold pursuant to this section
is canceled due to the payment of all sums for which the buyer is liable under
a loan contract, the holder of the loan contract shall, upon receipt of payment
of all sums due, send notice to the buyer within fifteen business days after
payment of the sums due of the name, address, and telephone number of the
insurance company or motor club which issued the insurance contract or motor
club service contract or the party responsible for any refund and notice that
the buyer may be eligible for a refund. A copy of such notice shall be retained
by the holder of the loan contract. This subsection does not apply if the
holder of the loan contract previously credited the refund of the insurance
premium or motor club service contract fee to the loan contract or otherwise
refunded the insurance premium or motor club service contract fee to the buyer.
(8) The licensee shall, at the time the loan is made, give to the
borrower, or if more than one, to one of them, a statement concerning any
insurance procured by or through the licensee, which includes the amount of any
premium which the borrower has paid or is obligated to pay, the expiration date
of the policy, and a concise description of the risks insured. If a borrower
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procures insurance by or through a licensee, the licensee shall deliver to the
borrower within fifteen days after the making of the loan an executed copy of
the insurance policy or certificate of insurance.
Sec. 81. (1) Licensees holding an active installment loan license may
make preauthorized loans. Preauthorized loan means a loan made by a licensee
pursuant to an agreement between the licensee and the borrower whereby:
(a) The licensee may permit the borrower to obtain advances of money from
the licensee from time to time or the licensee may advance money on behalf of
the borrower from time to time as directed by the borrower;
(b) The amount of each advance and permitted charge and cost is debited to
the borrower's account and payments and other credits are credited to the same
account;
(c) The charges are computed on the unpaid principal balance or balances
of the account from time to time;
(d) The borrower has the privilege of paying the account in full at any
time or, if the account is not in default, in monthly installments or fixed or
determinable amounts as provided in the agreement; and
(e) The loan agreement expressly states that it covers preauthorized
loans. Preauthorized loan does not mean a transaction, resulting in either a
credit or a debit to the borrower's account, which is initiated by the use or
application of a plastic, metal, or other type of credit or transaction card.
(2) For purposes of computations relating to preauthorized loans made
pursuant to the Nebraska Installment Loan and Sales Act, billing cycle means
the time interval between periodic billing dates. A billing cycle shall be
considered monthly if the closing date of the cycle is the same date each month
or does not vary by more than four days from such date.
Sec. 82. (1) A licensee may make preauthorized loans and may contract for
and receive charges on such loans as set forth in subsection (1) of section 70
of this act, subject to the following requirements:
(a) A licensee shall not compound charges by adding any unpaid charges
authorized by section 70 of this act or this section to the unpaid principal
balance of the borrower's account, except that the unpaid principal balance may
include additional charges for credit life insurance or credit disability
insurance provided in connection with the preauthorized loan, subject to the
requirements and restrictions contained in section 83 of this act;
(b) Charges authorized by section 70 of this act or this section shall be
deemed not to exceed the maximum charges permitted by such sections if such
charges are computed in each billing cycle by any of the following methods:
(i) By converting each graduated monthly rate to a daily rate and
multiplying such daily rate by the applicable portion of the daily unpaid
principal balance of the account, in which case each daily rate is determined
by multiplying the authorized monthly rate by twelve and dividing by three
hundred sixty-five;
(ii) By multiplying each graduated monthly rate by the applicable portion
of the average daily unpaid principal balance of the account in the billing
cycle, in which case the average daily unpaid principal balance is the sum of
the amount unpaid each day during the cycle divided by the number of days in
the cycle; or
(iii) By converting each graduated monthly rate to a daily rate and
multiplying such daily rate by the applicable portion of the average daily
unpaid principal balance of the account in the billing cycle, in which case
each daily rate is determined by multiplying the authorized monthly rate by
twelve and dividing by three hundred sixty-five, and the average daily unpaid
principal balance is the sum of the amount unpaid each day during the cycle
divided by the number of days in the cycle; and
(c) For each method of computation set forth in this section, the billing
cycle shall be monthly and the unpaid principal balance on any day shall be
determined by adding to any balance unpaid as of the beginning of that day all
advances and other permissible amounts charged to the borrower and deducting
all payments and other credits made or received that day.
(2) The borrower under a preauthorized loan may at any time pay all or any
part of the unpaid balance in his or her account, or, if the account is not in
default, the borrower may pay the unpaid principal balance in monthly
installments. Minimum monthly payment requirements shall be determined by the
licensee and set forth in the preauthorized loan agreement, except that the
minimum monthly payment shall not be less than one and one-half percent of the
average daily unpaid principal balance of an account having an average daily
balance of more than three thousand dollars nor less than two percent of the
average daily unpaid principal balance of an account having an average daily
balance of three thousand dollars or less.
(3) A licensee may retain any security interest, including a mortgage on
real property, until the preauthorized account is terminated.
(4) Subsection (4) of section 45-345, subsection (3) of section 45-350,
and section 78 of this act shall not apply to preauthorized loans.
(5) The department may approve record-keeping systems for licensees and
may prescribe policies and procedures necessary to the administration of
preauthorized loans made pursuant to the Nebraska Installment Loan and Sales
Act.
Sec. 83. In addition to the charges permitted under section 82 of this
act, a licensee may contract for and receive the fees, costs, and expenses
permitted by the Nebraska Installment Loan and Sales Act on other loans,
subject to all the conditions and restrictions set forth in the act with the
following variations:
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(1) If credit life or disability insurance is provided and if the insured
dies or becomes disabled when there is an outstanding preauthorized loan
indebtedness, the insurance shall be sufficient to pay the total balance of the
loan due on the date of the borrower's death or the amount due as of the end of
the previous billing cycle, whichever is less, in the case of credit life
insurance, or all minimum payments which become due on the loan during the
covered period of disability in the case of credit disability insurance. The
additional charge for credit life insurance or credit disability insurance
shall be calculated in each billing cycle by applying the current monthly
premium rate for such insurance, as such rate may be determined by the Director
of Insurance, to the unpaid balances in the borrower's account, using either of
the methods specified in section 82 of this act for the calculation of loan
charges;
(2) No credit life or disability insurance written in connection with a
preauthorized loan shall be canceled by the licensee because of delinquency of
the borrower in the making of the required minimum payments on the loan unless
one or more of such payments is past due for a period of ninety days or more,
and the licensee shall advance to the insurer the amounts required to keep the
insurance in force during such period, which amounts may be debited to the
borrower's account;
(3) The department may, by rule and regulation or order, require a
statement of insurance that will be appropriate for preauthorized loans in lieu
of that required by section 80 of this act; and
(4) The amount, terms, and conditions of any insurance against loss or
damage to property must be reasonable in relation to the character and value of
the property insured and the maximum anticipated amount of credit to be
extended.
Sec. 84. (1) For purposes of this section, reverse-mortgage loan means a
loan made by a licensee which (a) is secured by residential real estate, (b) is
nonrecourse to the borrower except in the event of fraud by the borrower or
waste to the residential real estate given as security for the loan, (c)
provides cash advances to the borrower based upon the equity in the borrower's
owner-occupied principal residence, (d) requires no payment of principal or
interest until the entire loan becomes due and payable, and (e) otherwise
complies with the terms of this section.
(2) Reverse-mortgage loans shall be governed by the following rules
without regard to the requirements set out elsewhere for other types of
mortgage transactions: (a) Payment in whole or in part is permitted without
penalty at any time during the period of the loan; (b) an advance and interest
on the advance have priority over a lien filed after the closing of a reverse-
mortgage loan; (c) an interest rate may be fixed or adjustable and may also
provide for interest that is contingent on appreciation in the value of the
residential real estate; and (d) the advance shall not be reduced in amount or
number based on an adjustment in the interest rate when a reverse-mortgage loan
provides for periodic advances to a borrower.
(3) Reverse-mortgage loans may be made or acquired without regard to the
following provisions for other types of mortgage transactions: (a) Limitations
on the purpose and use of future advances or any other mortgage proceeds; (b)
limitations on future advances to a term of years or limitations on the term of
credit line advances; (c) limitations on the term during which future advances
take priority over intervening advances; (d) requirements that a maximum
mortgage amount be stated in the mortgage; (e) limitations on loan-to-value
ratios; (f) prohibitions on balloon payments; (g) prohibitions on compounded
interest and interest on interest; and (h) requirements that a percentage of
the loan proceeds must be advanced prior to loan assignment.
(4) A licensee may, in connection with a reverse-mortgage loan, charge to
the borrower (a) a nonrefundable loan origination fee which does not exceed two
percent of the appraised value of the owner-occupied principal residence at the
time the loan is made, (b) a reasonable fee paid to third parties originating
loans on behalf of the licensee, and (c) such other fees as are necessary and
required, including fees for inspections, insurance, appraisals, and surveys.
(5) Licensees failing to make loan advances as required in the loan
documents and failing to cure the default as required in the loan documents
shall forfeit an amount equal to the greater of two hundred dollars or one
percent of the amount of the loan advance the licensee failed to make.
Sec. 85. (1) Each retail installment sales contract shall be in writing,
shall be signed by both the buyer and the seller, and shall contain the
following items, and a copy thereof shall be delivered to the buyer at the time
the instrument is signed, except for contracts made in conformance with
subdivision (5)(c) of section 45-336:
(a) The cash sale price;
(b) The amount of the buyer's downpayment, and whether made in money or
goods, or partly in money and partly in goods, including a brief description of
any goods traded in;
(c) The difference between subdivisions (a) and (b) of this subsection;
(d) The amount included for insurance if a separate charge is made
therefor, specifying the types of coverages;
(e) The amount included for a debt cancellation contract or a debt
suspension contract if the debt cancellation contract or debt suspension
contract is a contract of a financial institution or licensee, such contract is
sold directly by such financial institution or licensee or by an unaffiliated,
nonexclusive agent of such financial institution or licensee in accordance with
12 C.F.R. part 37, as such part existed on January 1, 2025, and the financial
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institution or licensee is responsible for the unaffiliated, nonexclusive
agent's compliance with such part, and a separate charge is made therefor;
(f) The amount included for electronic title and lien services other than
fees and charges prescribed by law which actually are or will be paid to public
officials for determining the existence of or for perfecting, releasing, or
satisfying any security related to the credit transaction;
(g) The basic time price, which is the sum of subdivisions (c), (d), (e),
and (f) of this subsection;
(h) The time-price differential;
(i) The amount of the time-price balance, which is the sum of subdivisions
(g) and (h) of this subsection, payable in installments by the buyer to the
seller;
(j) The number, amount, and due date or period of each installment;
(k) The time-sales price; and
(l) The amount included for a guaranteed asset protection waiver.
(2) The contract shall contain substantially the following notice: NOTICE
TO THE BUYER. DO NOT SIGN THIS CONTRACT BEFORE YOU READ IT OR IF IT CONTAINS
BLANK SPACES. YOU ARE ENTITLED TO A COPY OF THE CONTRACT YOU SIGN.
(3) The items listed in subsection (1) of this section need not be stated
in the sequence or order set forth in such subsection. Additional items may be
included to explain the computations made in determining the amount to be paid
by the buyer. No installment sales contract shall be signed by the buyer or
proffered by the seller when it contains blank spaces to be filled in after
execution, except that if delivery of the goods or services is not made at the
time of the execution of the contract, the identifying numbers or marks of the
goods, or similar information, and the due date of the first installment may be
inserted in the contract after its execution.
(4) If a seller proffers an installment sales contract as part of a
transaction which delays or cancels, or promises to delay or cancel, the
payment of the time-price differential on the contract if the buyer pays the
basic time price, cash price, or cash sale price within a certain period of
time, the seller shall, in clear and conspicuous writing, either within the
installment sales contract or in a separate document, inform the buyer of the
exact date by which the buyer must pay the basic time price, cash price, or
cash sale price in order to delay or cancel the payment of the time-price
differential. The seller or any subsequent purchaser of the installment sales
contract, including a sales finance company, shall not be allowed to change
such date.
(5) Upon written request from the buyer, the holder of an installment
sales contract shall give or forward to the buyer a written statement of the
dates and amounts of payments and the total amount unpaid under such contract.
A buyer shall be given a written receipt for any payment when made in cash.
(6) After payment of all sums for which the buyer is obligated under a
contract, the holder shall deliver or mail to the buyer at his or her last-
known address one or more good and sufficient instruments or copies thereof to
acknowledge payment in full and shall release all security in the goods and
mark canceled and return to the buyer the original agreement or copy thereof or
instruments or copies thereof signed by the buyer. For purposes of this
section, a copy shall meet the requirements of section 25-12,112.
Sec. 86. (1)(a) Notwithstanding the provisions of any other law, the
time-price differential for any goods or services sold under an installment
sales contract shall be stated as a fixed or variable annual percentage rate
and shall be at a rate agreed to in writing, not to exceed eighteen percent per
annum, except that a minimum time-price differential of ten dollars may be
charged on any installment sales contract.
(b) Origination fees may be required to be made by the buyer, subject to
the following requirements:
(i) A buyer may be required, upon the execution of the installment sales
contract, to pay an origination fee in an amount not to exceed ten dollars,
except that if the installment sales contract is for an installment sale of
agricultural machinery or equipment for use in commercial agriculture or if the
installment sales contract is for an installment sale of industrial machinery
or equipment, the buyer may be required to pay (A) an origination fee of not to
exceed one hundred dollars if the cash sale price is less than twenty-five
thousand dollars or (B) an origination fee of not to exceed two hundred fifty
dollars if the cash sale price is twenty-five thousand dollars or more; and
(ii) The origination fee shall be refundable if the installment sales
contract is canceled during the first thirty days. The origination fee may be
collected from the buyer or included in the principal balance of the
installment sales contract at the time the contract is made and shall not be
considered interest or a time-price differential.
(c) Nothing in the Nebraska Installment Loan and Sales Act prohibits a
seller or holder of an installment sales contract from contracting for,
computing, and charging a time-price differential based upon the application of
the rate charged to the unpaid principal balance for the number of days
actually elapsed. The charges so computed shall be used for the purpose of
calculating the time-price differential, the time-price balance, the amount of
each installment, and the time-sale price.
(d) When the installment sales contract is payable in substantially equal
and consecutive monthly installments, the time-price differential shall be
computed on the basic time price of each contract, as determined under section
85 of this act, from the date of the contract until the due date of the final
installment, notwithstanding that the time-price balance is required to be paid
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in installments.
(2) When an installment sales contract provides for payment other than in
substantially equal and consecutive monthly installments, the time-price
differential may be at a rate which will provide the same return as is
permitted on substantially equal monthly payment contracts under subdivision
(1)(d) of this section, having due regard for the schedule of payments.
(3) Every contract payable in two or more installments shall provide for
payment of such installments by stating the date and amount of each installment
or the method by which any variable rate or installment shall be determined.
Sec. 87. (1) The amount, if any, included for insurance, which may be
purchased by the holder of the contract, shall not exceed the applicable
premium rates chargeable in accordance with filings, if any, with the
Department of Insurance. If dual interest insurance on the goods is purchased
by the holder, it shall, within thirty days after execution of the installment
sales contract, send or cause to be sent to the buyer a policy or policies or
certificate of insurance, written by an insurance company authorized to do
business in this state, clearly setting forth the amount of the premium, the
kind or kinds of insurance, the coverages, and all the terms and conditions of
the contract or contracts of insurance.
(2) If any insurance is canceled or the premium adjusted during the term
of the installment sales contract, any refund of the insurance premium plus the
unearned time-price differential thereon received by the holder shall be
credited by the holder to the last maturing installment of the contract except
to the extent applied toward payment for similar insurance protecting the
interests of the buyer and the holder or either of them.
(3) If any insurance is canceled due to the payment of all sums for which
the buyer is liable under an installment sales contract, the holder of the
installment sales contract shall, upon receipt of payment of all sums due, send
notice to the buyer within fifteen business days of the name, address, and
telephone number of the insurance company which issued the insurance contract
or the party responsible for any refund, and notice that the buyer may be
eligible for a refund. A copy of such notice shall be retained by the holder of
the installment sales contract. This subsection does not apply if the holder of
the loan contract previously credited the refund of the insurance premium to
the loan contract or otherwise refunded the insurance premium to the buyer.
(4) The holder may also purchase nonfiling insurance and charge a
reasonable fee. The fee shall not exceed the amount of fees and charges
prescribed by law which would have been paid to public officials for filing,
perfecting, releasing, and satisfying any lien or security interest in the
goods or services.
Sec. 88. (1) Notwithstanding the provisions of any contract to the
contrary, any buyer may prepay in full at any time before maturity the
obligation of any contract.
(2) If such obligation is prepaid in full by cash, a new loan, or
otherwise after the first installment due date, the borrower shall receive a
rebate of an amount which shall be not less than the amount obtained by
applying to the unpaid principal balances as originally scheduled or, if
deferred, as deferred, for the period following prepayment, according to the
actuarial method, the rate of the time-price differential previously stated to
the borrower. The licensee may round the rate of the time-price differential to
the nearest one-half of one percent if such procedure is not consistently used
to obtain a greater yield than would otherwise be permitted. Any default and
deferment charges which are due and unpaid may be deducted from any rebate. No
rebate shall be required for any partial prepayment. No rebate of less than one
dollar need be made. Acceleration of the maturity of the contract shall not in
itself require a rebate. If judgment is obtained before the final installment
date, the contract balance shall be reduced by the rebate which would be
required for prepayment in full as of the date judgment is obtained.
Sec. 89. (1) Where a buyer makes any subsequent purchases of goods or
services from a seller from whom such buyer has previously purchased goods or
services under one or more installment sales contracts and the amounts under
such contract or contracts to the extent of cash sale price thereof have not
been fully paid, the subsequent purchases may be included in and consolidated
with one or more of the prior contract or contracts. A memorandum of such
additional purchases shall be prepared by the seller and inserted in or
attached to the seller's counterpart of the contract and shall set forth:
(a) The names of the seller and the buyer and a description of the
additional goods or services sold and all the information with respect to the
additional purchase required by section 85 of this act to be included in an
installment sales contract;
(b) The consolidated time-price balance to be paid by the buyer; and
(c) The revised payments.
(2) A copy of such memorandum shall be delivered to the buyer as provided
in and subject to section 85 of this act. When such subsequent purchases are
made, the entire amount of all payments made prior to such subsequent purchases
shall be deemed to have been applied on previous purchases.
(3) Each payment thereafter made on a consolidated installment sales
contract shall be deemed to be allocated to all of the various purchases in the
same ratio or proportion as the original cash sale prices of the various
purchases bear to one another. Where the amount of each deferred payment is
increased in connection with such subsequent purchase, the subsequent payments,
at the seller's option, may be deemed to be allocated as follows: An amount
equal to the original installment payment to the previous purchase, the balance
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to the subsequent purchase. The amount of any initial payment or downpayment on
the subsequent purchase shall be allocated in its entirety to such subsequent
purchase. This section shall not apply to cases involving equipment, parts, or
other merchandise attached or affixed to goods previously purchased, or to
repairs or services in connection therewith rendered by the seller at the
buyer's request.
Sec. 90. (1) An installment sales contract may provide and the holder
thereof may collect, in addition to any time-price differential, a delinquency
charge on each installment in default for a period of not less than fifteen
days, if provided for in the contract, not in excess of five percent of each
installment or twenty-five dollars, whichever is less, or, in lieu thereof,
interest after maturity on each such installment not exceeding the highest
permissible contract rate. If the time-price differential is computed by
application of the rate charged to the unpaid principal balance for the number
of days actually elapsed, such delinquency charge may not exceed five percent
of each installment or twenty-five dollars, whichever is less. If any
installment payment is made by a check, draft, or similar signed order which is
not honored because of insufficient funds, no account, or any other reason
except an error of a third party to the contract, the holder may charge and
collect a fee of not more than fifteen dollars. The delinquency charge and such
fee may be collected when due or at any time thereafter.
(2) When an installment sales contract is for a commercial or business
purpose (a) a delinquency charge not to exceed five percent of each unpaid
installment may be contracted for and received and (b) the holder of any check
or draft or similar order which is not honored for any reason, except for error
of a third party, may charge and collect a fee as stated in the contract. As
used in this section, commercial or business purpose means primarily for a
purpose other than a personal, family, or household purpose.
Sec. 91. The holder of a retail installment sales contract may, upon
agreement with the buyer:
(1) Extend the scheduled due date or defer the scheduled payment of any
installment payment under the retail installment sales contract; and
(2) Charge and collect a reasonable flat service fee for such extension or
deferment in addition to the time-price differential calculated for the period
of such extension or deferment at the rate originally agreed upon in the retail
installment sales contract on the outstanding balance.
Sec. 92. (1) If any seller or sales finance company, in the making or
collection of an installment sales contract, shall, directly or indirectly,
contract for, take, or receive charges in excess of those authorized by the
Nebraska Installment Loan and Sales Act except as a result of an accidental and
bona fide error, such contract shall be void and uncollectible as to (a) all of
the excessive portion of the time-price differential, (b) the first one
thousand dollars of the time-price differential authorized by section 86 of
this act, and (c) the first four thousand dollars of the principal of the
contract.
(2) If any seller or sales finance company violates any provision of the
act, other than the violations described in subsection (1) of this section,
except as a result of an accidental and bona fide error, such installment sales
contract shall be void and uncollectible as to the first five hundred dollars
of the time-price differential and the first one thousand dollars of the
principal of such contract. If any of such money has been paid by the buyer,
such buyer or his or her assignee may recover under the act in a civil suit
brought within one year after the due date, or any extension thereof, of the
last installment of the contract.
Sec. 93. (1) A licensee shall not refuse to enter into a loan or impose
finance charges or other terms or conditions of credit more onerous than those
regularly extended by that licensee to borrowers of similar economic
backgrounds because of the age, color, creed, national origin, political
affiliation, race, religion, sex, marital status, or disability of the borrower
or because the borrower receives public assistance, social security benefits,
pension benefits, or the like.
(2) No licensee shall conduct the business of making loans under the
Nebraska Installment Loan and Sales Act within any office, room, or place of
business in which any other business is solicited or engaged in, or in
association or conjunction with any other business, if the director finds that
the other business is of such nature that the conducting of such other business
tends to conceal evasion of the act or of the rules and regulations adopted and
promulgated under the act. In such case, the director shall order such licensee
in writing to cease and desist from such conduct.
(3) No licensee shall, directly or indirectly, require a borrower as a
condition of granting a loan to such borrower to reaffirm or otherwise obligate
the borrower to pay a former debt to the licensee which has been discharged in
bankruptcy proceedings.
(4) Any person who makes a false statement to secure a loan is guilty of a
Class III misdemeanor. The punishment shall not be exacted, however, when such
a loan is made after the licensee is aware of the falsity of the statement.
(5) No licensee or other person subject to the Nebraska Installment Loan
and Sales Act shall advertise, print, display, publish, distribute, or
broadcast or cause or permit to be advertised, printed, displayed, published,
distributed, or broadcast in any manner whatsoever any false, misleading, or
deceptive statement or representation with regard to the rates, terms, or
conditions for the lending of money, credit, goods, or things in action. The
director may order any licensee to cease and desist from any conduct which he
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or she finds to be a violation of this section. The director may require that
rates of charge, if stated by a licensee, be stated fully and clearly in such
manner as the director deems necessary to prevent misunderstanding by
prospective borrowers.
(6) No loan, made outside this state, in the amount or of the value of
three thousand dollars or less, for which a greater rate of interest,
consideration, or charges than is permitted by section 45-350 has been charged,
contracted for, or received, shall be enforced in this state. Every person
participating in such loan in this state is subject to the Nebraska Installment
Loan and Sales Act, except that the act shall not apply to loans legally made
in any state under and in accordance with a regulatory small loan law similar
in principle to such act.
(7) In connection with the collection of any loan, a licensee may not:
(a) Use or threaten to use violence;
(b) Use obscene or profane language;
(c) Cause a telephone to ring or engage a person in telephone conversation
at times known to be inconvenient to the borrower;
(d) Falsely represent the character, amount, or legal status of any debt;
(e) Falsely represent that an individual is an attorney when he or she is
not;
(f) Falsely represent that nonpayment of any debt will result in the
arrest or imprisonment of the borrower or any member of the borrower's
household;
(g) Threaten to take any action that the licensee knows cannot legally be
taken at the time the threat is made;
(h) Falsely represent that the borrower committed any crime when the
borrower did not;
(i) Communicate or threaten to communicate to any person credit
information which is known to be false;
(j) Use or distribute any written communication which falsely represents
that it is a document authorized, issued, or approved by any court, official,
or agency of the United States or any state;
(k) Charge or collect any fees, charges, or expenses, incidental to the
collection of any loan, unless such amount is expressly authorized by the loan
agreement or permitted by law;
(l) Accept from any person a check or other payment instrument postdated
by more than five days unless such person is notified in writing of the
licensee's intent to deposit such check or instrument not more than ten nor
less than three business days prior to such deposit;
(m) Solicit any postdated check or other postdated payment instrument for
the purpose of threatening or instituting criminal prosecution;
(n) Deposit or threaten to deposit any postdated check prior to the date
on such check;
(o) Cause charges to be made to any person for communications by
concealment of the true purpose of the communication, including, but not
limited to, collect telephone calls and telegram fees;
(p) Communicate with a borrower regarding a debt by postcard; or
(q) Communicate with a borrower at the borrower's place of employment if
the licensee has received actual notice that the borrower's employer prohibits
the borrower from receiving such communication.
Sec. 94. (1) The department shall require licensees to be licensed and
registered through the Nationwide Mortgage Licensing System and Registry. In
order to carry out this requirement, the department is authorized to
participate in the Nationwide Mortgage Licensing System and Registry. For this
purpose, the department may establish, by adopting and promulgating rules and
regulations or by order, requirements as necessary. The requirements may
include, but not be limited to:
(a) Background checks of applicants and licensees, including, but not
limited to:
(i) Fingerprints of every executive officer, director, partner, member,
sole proprietor, or shareholder submitted to the Federal Bureau of
Investigation and any other governmental agency or entity authorized to receive
such information for a state, national, and international criminal history
record information check;
(ii) Civil or administrative records;
(iii) Credit history; or
(iv) Any other information as deemed necessary by the Nationwide Mortgage
Licensing System and Registry;
(b) The payment of fees to apply for or renew a license through the
Nationwide Mortgage Licensing System and Registry;
(c) Compliance with prelicensure education and testing and continuing
education;
(d) The setting or resetting, as necessary, of renewal processing or
reporting dates; and
(e) Amending or surrendering a license or any other such activities as the
director deems necessary for participation in the Nationwide Mortgage Licensing
System and Registry.
(2) In order to fulfill the purposes of the Nebraska Installment Loan and
Sales Act, the department is authorized to establish relationships or contracts
with the Nationwide Mortgage Licensing System and Registry or other entities
designated by the Nationwide Mortgage Licensing System and Registry to collect
and maintain records and process transaction fees or other fees related to
licensees or other persons subject to the act. The department may allow such
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system to collect licensing fees on behalf of the department and allow such
system to collect a processing fee for the services of the system directly from
each licensee or applicant for a license.
(3) The director is required to regularly report violations of the act
pertaining to residential mortgage loans, as defined in section 45-702, as well
as enforcement actions and other relevant information, to the Nationwide
Mortgage Licensing System and Registry subject to the provisions contained in
this section.
(4) The director shall establish a process whereby applicants and
licensees may challenge information entered into the Nationwide Mortgage
Licensing System and Registry by the director.
(5) The department shall ensure that the Nationwide Mortgage Licensing
System and Registry adopts a privacy, data security, and security breach
notification policy. The director shall make available upon written request a
copy of the contract between the department and the Nationwide Mortgage
Licensing System and Registry pertaining to the breach of security of the
system provisions.
(6) The department shall upon written request provide the most recently
available audited financial report of the Nationwide Mortgage Licensing System
and Registry.
(7) The director may use the Nationwide Mortgage Licensing System and
Registry as a channeling agent for requesting information from and distributing
information to the United States Department of Justice or any other
governmental agency in order to reduce the points of contact which the Federal
Bureau of Investigation may have to maintain for purposes of subsection (1) of
this section.
(8) In order to promote more effective regulation and reduce the
regulatory burden through supervisory information sharing:
(a) Except as otherwise provided in this section, the requirements under
any federal or state law regarding the privacy or confidentiality of any
information or material provided to the Nationwide Mortgage Licensing System
and Registry, and any privilege arising under federal or state law, including
the rules of any federal or state court, with respect to such information or
material, shall continue to apply to such information or material after the
information or material has been disclosed to the Nationwide Mortgage Licensing
System and Registry. Such information and material may be shared with all
federal and state regulatory officials with mortgage industry oversight
authority without the loss of privilege or the loss of confidentiality
protections provided by federal or state law;
(b) Information or material that is subject to a privilege or
confidentiality under subdivision (8)(a) of this section shall not be subject
to:
(i) Disclosure under any federal or state law governing the disclosure to
the public of information held by an officer or an agency of the federal
government or the respective state; or
(ii) Subpoena or discovery, or admission into evidence, in any private
civil action or administrative process, unless with respect to any privilege
held by the Nationwide Mortgage Licensing System and Registry with respect to
such information or material, the person to whom such information or material
pertains waives, in whole or in part, in the discretion of such person, that
privilege;
(c) Any state statute relating to the disclosure of confidential
supervisory information or any information or material described in subdivision
(1)(a) of this section that is inconsistent with such subdivision shall be
superseded by the requirements of this section; and
(d) This section shall not apply with respect to the information or
material relating to the employment history of, and publicly adjudicated
disciplinary and enforcement actions against, applicants and licensees that is
included in the Nationwide Mortgage Licensing System and Registry for access by
the public.
(9) For these purposes, the director is authorized to enter