Virginia Code 6.2-1501: Compliance with chapter; license required; attempts to evade application of chapter
A. No person shall engage in the business of making loans to individuals for personal, family, household, or other nonbusiness purposes, and charge, contract for, or receive, directly or indirectly, on or in connection with any loan interest, charges, compensation, consideration, or expense that in the aggregate is greater than the interest permitted by § 6.2-303, whether or not the person has a location in the Commonwealth, except as provided in and authorized by this chapter, Chapter 18 (§ 6.2-1800 et seq.), or Chapter 22 (§ 6.2-2200 et seq.) and without first having obtained a license from the Commission.
Terms Used In Virginia Code 6.2-1501
- Access partner: means a person that, at the person's physical location in the Commonwealth, facilitates the making and servicing of a loan through provision of some or all of the services described in § 6. See Virginia Code 6.2-1500
- Arranging or brokering: means , with respect to consumer finance loans, negotiating, placing, or finding consumer finance loans for consumers, or offering to negotiate, place, or find consumer finance loans for consumers, in return for compensation paid directly by the consumers. See Virginia Code 6.2-1500
- Commission: means the State Corporation Commission. See Virginia Code 6.2-100
- Contract: A legal written agreement that becomes binding when signed.
- Forbearance: A means of handling a delinquent loan. A
- Guarantor: A party who agrees to be responsible for the payment of another party's debts should that party default. Source: OCC
- Licensee: means a consumer finance company to which a license has been issued by the Commission pursuant to this chapter. See Virginia Code 6.2-1500
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Person: means any individual, corporation, partnership, association, cooperative, limited liability company, trust, joint venture, government, political subdivision, or other legal or commercial entity. See Virginia Code 6.2-100
- Principal: means any person who, directly or indirectly, owns or controls (i) 10 percent or more of the outstanding stock of a stock corporation or (ii) a 10 percent or greater interest in another person. See Virginia Code 6.2-1500
B. Subject to subdivision C 3 and subsection C of § 6.2-1524, the prohibition in subsection A shall not be construed to prevent any person, other than a licensee, from:
1. Providing the services of an access partner described in § 6.2-1523.1;
2. Making a mortgage loan pursuant to §§ 6.2-325 and 6.2-326 or §§ 6.2-327 and 6.2-328 in any principal amount; or
3. Extending credit as described in § 6.2-312 in any amount.
C. The provisions of subsection A shall apply to any person who seeks to evade its application by any device, subterfuge, or pretense whatsoever, including:
1. The loan, forbearance, use, or sale of (i) credit, as guarantor, surety, endorser, comaker, or otherwise; (ii) money; (iii) goods; or (iv) things in action;
2. The use of collateral or related sales or purchases of goods or services, or agreements to sell or purchase, whether real or pretended; receiving or charging compensation for goods or services, whether or not sold, delivered, or provided; and
3. The real or pretended negotiation, arrangement, or procurement of a loan through any use or activity of a third person, whether real or fictitious.
D. No person shall engage in the business of arranging or brokering consumer finance loans for any consumer residing in the Commonwealth, whether or not the person has an office or conducts business at a location in the Commonwealth.
E. The provisions of this section shall apply to any person, whether or not the person has an office or conducts business at a location in the Commonwealth.
F. Any loan made in violation of this section is void, and no person shall have the right to collect, receive, or retain any principal, interest, fees, or other charges in connection with the loan.
Code 1950, §§ 6-279, 6-281; 1956, c. 71; 1966, c. 584, §§ 6.1-249, 6.1-251; 1968, c. 489; 1974, c. 371; 1986, c. 502; 1995, c. 2; 1998, c. 9; 2001, c. 308; 2002, c. 897; 2010, cc. 477, 794; 2020, cc. 1215, 1258.