(a) Any facilitator who advertises the availability of a refund anticipation loan shall not directly or indirectly represent the loan as a customer‘s actual refund. Any advertisement that mentions a refund anticipation loan shall state conspicuously that it is a loan and that a fee or interest will be charged by the lending institution. The advertisement shall also disclose the name of the lending institution.
Terms Used In Tennessee Code 62-29-202
Annual percentage rate: The cost of credit at a yearly rate. It is calculated in a standard way, taking the average compound interest rate over the term of the loan so borrowers can compare loans. Lenders are required by law to disclose a card account's APR. Source: FDIC
Applicant: means a customer who applies for a refund anticipation loan through a facilitator. See Tennessee Code 62-29-201
Borrower: means an applicant who receives a refund anticipation loan through a facilitator. See Tennessee Code 62-29-201
Customer: means an individual for whom tax preparation services are performed. See Tennessee Code 62-29-201
Facilitator: means a person who receives or accepts for delivery an application for a refund anticipation loan, delivers a check in payment of refund anticipation loan proceeds or in any other manner acts to allow the making of a refund anticipation loan. See Tennessee Code 62-29-201
Fraud: Intentional deception resulting in injury to another.
Person: means an individual, a firm, a proprietorship, an association, a corporation or another entity. See Tennessee Code 62-29-201
Refund anticipation loan: means a loan, whether provided through a facilitator or by another entity such as a financial institution, in anticipation of and whose payment is secured by a customer's federal or state income tax refund, or by both. See Tennessee Code 62-29-201
Refund anticipation loan fee: means any fee, charge or other consideration imposed by a lender or a facilitator for a refund anticipation loan. See Tennessee Code 62-29-201
Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
Tax return: means a return, declaration, statement, refund claim or other document required to be made or filed in connection with state or federal income taxes. See Tennessee Code 62-29-201
Truth in Lending Act: The Truth in Lending Act is a federal law that requires lenders to provide standardized information so that borrowers can compare loan terms. In general, lenders must provide information on Source: OCC
written: includes printing, typewriting, engraving, lithography, and any other mode of representing words and letters. See Tennessee Code 1-3-105
(b) Every facilitator who offers to facilitate or who facilitates a refund anticipation loan to a customer shall display a refund anticipation loan schedule showing the current fees for refund anticipation loans facilitated at the office, for the electronic filing of customer’s tax return, for setting up a refund account and for any other related activities necessary to receive a refund anticipation loan. The fee schedule shall also include a statement indicating that a customer may have the tax return filed electronically without also obtaining a refund anticipation loan.(c) The posting required by subsection (b) shall be made in no less than twenty-eight (28) point type on a document measuring no less than sixteen inches by twenty inches (16″ x 20″). The postings required in this section shall be displayed in a prominent location at each office where any facilitator is offering to facilitate or facilitating a refund anticipation loan.(d)(1) Prior to an applicant‘s completion of the refund anticipation loan application, a facilitator that offers to facilitate a refund anticipation loan shall provide to the applicant a clear disclosure containing all of the following information:
(A) The refund anticipation loan fee schedule;(B) That a refund anticipation loan is a loan and is not the applicant’s actual income tax refund;(C) That a customer can file an income tax return electronically without applying for a refund anticipation loan;(D) The average amount of time, according to the internal revenue service, within which a customer who does not obtain a refund anticipation loan can expect to receive a refund if a customer’s return is filed or mailed as follows:
(i) Filed electronically and the refund is deposited directly into a customer’s bank account or mailed to the customer; and(ii) Mailed to the internal revenue service and the refund is deposited directly into a customer’s bank account or mailed to a customer;(E) That the internal revenue service does not guarantee that it will pay the full amount of the anticipated refund and it does not guarantee a specific date that a refund will be deposited into a customer’s bank account or mailed to a customer;(F) That the borrower is responsible for the repayment of the refund anticipation loan and the related fees in the event that the tax refund is not paid or paid in full;(G) The estimated time within which the loan proceeds will be paid to the borrower if the loan is approved; and(H) The fee that will be charged, if any, if the applicant’s loan is not approved.(2) Prior to an applicant’s consummation of the refund anticipation loan transaction, a facilitator shall provide to the applicant, in either written or electronic form, the following information:
(A) The estimated total fees for obtaining the refund anticipation loan;(B) The estimated annual percentage rate for the applicant’s refund anticipation loan, using the guidelines established under the federal Truth in Lending Act (15 U.S.C. § 1601 et seq.); and(C) The various costs, fees and finance charges, if applicable, associated with receiving a refund by mail or by direct deposit directly from the internal revenue service, a refund anticipation loan, a refund anticipation check or any other refund settlement options facilitated by the facilitator.(e) Any facilitator who offers to facilitate or who facilitates a refund anticipation loan may not engage in any of the following activities:
(1) Requiring a customer to enter into a loan arrangement in order to complete a tax return;(2) Misrepresenting a material factor or condition of a refund anticipation loan;(3) Failing to process the application for a refund anticipation loan promptly after an applicant applies for the loan; or(4) Engaging in any transaction, practice or course of business that operates a fraud upon any person in connection with a refund anticipation loan.(f) When an application involves more than one (1) customer, notification pursuant to this section need only be given to one (1) customer.
