ASSEMBLY, No. 2348

STATE OF NEW JERSEY

INTRODUCED SEPTEMBER 19, 1996

By Assemblymen ZECKER and WEINGARTEN

An Act concerning parity among New Jersey depository lenders and amending P.L.1981, c.4.

    Be It Enacted by the Senate and General Assembly of the State of New Jersey:

    1. Section 2 of P.L.1981, c.4 (C.17:13B-2) is amended to read as follows:

    2. Notwithstanding any provisions of R.S.31:1-1 or any other statute to the contrary, any bank, savings bank, savings and loan association or credit union may charge [a rate of interest] any periodic percentage rate on the outstanding balance and include any other charges or fees on any class or type of loan [at the rate of interest] as permitted to any other lender by the laws of this State on that class or type of loan. Nothing in this act shall authorize any lender to make any loan it is not authorized by law to make, nor shall anything in this act apply to loans secured by a first lien on real estate on which there is erected or to be erected a structure containing one, two, three, four, five, or six dwelling units, a portion of which structure may also be used for nonresidential purposes.

(cf: P.L.1981, c.4, s.2)

    2. This act shall take effect immediately.

STATEMENT

    "The State Bank Parity Act," P.L.1981, c.4 (C.17:13B-1 et seq.), was intended to permit even competition among New Jersey lending institutions (banks, savings banks, savings and loan associations and credit unions) by permitting all of them to charge a rate of interest permitted to any one or more of them. Recent court decisions have construed the statute to be limited only to the periodic percentage rate of interest charged on an outstanding balance. This bill provides that parity goes to other fees and charges such as, but not limited to, late charges and collection fees.

Permits parity among New Jersey depository institutions with respect to lending practices.