Utah Administrative Code
The Utah Administrative Code is the body of all effective administrative rules as compiled and organized by the Division of Administrative Rules (see Subsection 63G-3-102(5); see also Sections 63G-3-701 and 702).
NOTE: For a list of rules that have been made effective since January 1, 2020, please see the codification segue page.
NOTE TO RULEFILING AGENCIES: Use the RTF version for submitting rule changes.
R335. Financial Institutions, Consumer Credit.
Rule R335-2. Rule Prescribing Allowable Terms and Disclosure Requirements for Variable and Adjustable Interest Rates in Consumer Credit Contracts.
As in effect on January 1, 2020
Table of Contents
- R335-2-1. Authority, Scope, and Purpose.
- R335-2-2. Definition.
- R335-2-3. Permissible Indexes.
- R335-2-4. Initial Disclosure Requirements.
- R335-2-5. Subsequent Disclosure Requirements.
- R335-2-6. Specific Adjustment Schedule Required.
- Date of Enactment or Last Substantive Amendment
- Notice of Continuation
- Authorizing, Implemented, or Interpreted Law
(1) This rule is adopted pursuant to Section 70C-8-102(1)(e).
(2) This rule shall apply to all credit transactions subject to the provisions of Title 70C, Utah Consumer Credit Code.
(3) The purpose for this rule is
(a) to distinguish variable or adjustable interest rates from other kinds of rate formulas or provisions, such as a demand note or a unilateral right to change terms,
(b) to specify what must be included in rate formulas represented to be variable or adjustable, and
(c) to specify certain disclosure requirements under state and federal law applicable to variable or adjustable rate and other formulas.
For purposes of this rule, "variable or adjustable rate" shall refer to any interest rate or finance charge in a consumer credit agreement which varies or fluctuates in accordance with a specified index, whether or not any variation is subject to a minimum or maximum change, or both, or a floor or ceiling rate, or both.
(1) Any index may be used in a variable or adjustable rate formula if:
(a) it references a rate or value completely beyond the lender's control, or
(b) it is based entirely on the lender's weighted cost of funds, or
(c) it is a rate used by the lender as a basis for setting the rate on most of its non-consumer loans, provided that at least half the lender's total credit outstanding is not consumer credit during the entire period the rate is an index for any variable or adjustable rate consumer loan; and
(2) All information pertinent to setting or calculating the rate is readily available to the borrower during the entire term of the credit agreement.
Except for an internal index as described in Rule R335-2-3 above, if any index is derived or calculated from two or more rates or values, or both, each rate or value, or both, must be specifically disclosed in the original credit agreement, together with the method to be used for calculating the index, and thereafter each calculation of the index must be made in the manner disclosed utilizing each rate or value, or both, described. This section shall not prevent a change of any term of a variable or adjustable rate formula in an open-end consumer credit contract in accordance with Section 70C-4-102.
(1) Any change in the applicable rate resulting from a change in the numerical value of an index need not be disclosed in advance of the change.
(2) Each regular statement of account shall state the rate or weighted average of rates applicable to the account during the period covered by the statement; otherwise, it will not be necessary to give notice of any change in the applicable rate or describe the amount of any change.
Any credit agreement containing a variable or adjustable rate must include a schedule stating when the rate will be adjusted and must require adjustment of the rate in accordance with that schedule.
September 20, 2017
For questions regarding the content or application of rules under Title R335, please contact the promulgating agency (Financial Institutions, Consumer Credit). A list of agencies with links to their homepages is available at http://www.utah.gov/government/agencylist.html or from http://www.rules.utah.gov/contact/agencycontacts.htm.