DENVER – Attorney General John Suthers announced that his office has issued annual reports on sub-prime lending activity in Colorado for 2004. The Attorney General’s Office enforces the Colorado Uniform Consumer Credit Code – Colorado’s consumer lending law. Sub-prime lenders that make or take assignment of consumer loans with an annual percentage rate (APR) of 12% or more must be licensed under the Uniform Consumer Credit Code (UCCC) and report their lending activity on an annual basis. Individual lender reports are compiled into composite reports, based on type of loans made.
The three composite reports for calendar year 2004 are for payday or deferred deposit lenders, supervised lenders (finance companies and junior-lien mortgage lenders), and small installment lenders.
Deferred deposit or payday loans are small loans up to $500 for 40 days or less. Most payday loans are due on the consumer’s next payday. The maximum finance charge allowed under law for a $500 loan is $75. The supervised lender report reflects loans made by finance companies, insurance premium finance companies, and mortgage lenders that make junior lien loans with an APR over 12%.
This is the first report for lenders making small installment loans. In 2004, the Colorado General Assembly passed House Bill 04-1394 to allow alternative loan charges for small loans. It permits higher finance charges for loans up to $1,000 with a loan term of between ninety days and twelve months.
The Consumer Credit Unit of the Attorney General’s Office licenses lenders making sub-prime loans, conducts compliance examinations of these lenders on a periodic basis, and investigates complaints about unlawful activity. The composite reports are available at www.ago.state.co.us/UCCC/AnnualReports.cfm.