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Montana Consumer Loan Licensing

A consumer loan license is needed to engage in business as defined in the Montana Consumer Loan Act (Section 32-5-101, MCA).

Important Considerations for Consumer Loan Licensees

  1. The original copy of the consumer loan license is to be displayed at the licensed location in Montana. If you do not have a Montana location, you will receive a copy of the license and the original license will be mailed to your Montana registered agent.
  2. Each location conducting consumer loan business must be licensed. A consumer loan license is not required for locations engaged only in support functions such as loan servicing or payment processing.
  3. If a licensee changes location the Division of Banking and Financial Institutions must be promptly notified in writing. The original license must be surrendered and an amended license will be issued, except when a conusmer loan licensee relocates to another county. In those instances, a new Consumer Loan License application must be completed.
  4. Licenses expire at the end of the calendar year in which they are issued. Licensees will receive a renewal packet in October or early November, which is to be returned to the Division of Banking and Financial Institutions by December 1.
  5. Licenses are non-transferable and non-assignable.
  6. Statutory and operational benefits conferred by a license apply only to business activity after the date of licensure. Business conducted prior to the date of licensure is not ratified or validated by obtaining a license.
  7. Montana law requires each licensee to maintain books, accounts and records that will allow the Division of Banking and Financial Institutions to determine if the licensee is complying with the provisions of the Montana Consumer Loan Act.
  8. Each licensee is also required to file an annual report using a form provided by the Division of Banking and Financial Institutions. Report forms are mailed to each licensee near the beginning of each calendar year.
  9. New Licensees: Please notify us as soon as possible when you commence making consumer loans, as it is the practice of the Division of Banking and Financial Institutions to conduct an initial examination of a new licensee within the first few weeks of operation.

Administrative Rules

Administrative Rule Notices

Recent Legislation (2007 Regular Session)

  • House Bill 141 (Effective October 1, 2008, but Sections 3 and 5, which pertain to licensing fee increases are effective October 1, 2007)

Forms & Instructions

Wombold v. Associates Financial Services Company

On December 30, 2004, the Montana Supreme Court in Wombold v. Associates Financial Services Company, 2004 MT 397, 2004 Mont. LEXIS 680, held that prepaid finance charges, loan fees and discount points paid on the origination of real estate loans by Consumer Loan Licensees are prohibited by the Montana Consumer Loan Act. A copy of the case may be found on the Montana State Law Library website at http://www.lawlibrary.mt.gov/dscgi/ds.py/Get/File-37835/03-808.pdf.

Please seek the advice of competent legal counsel and structure all loans made after December 30, 2004 in accordance with this holding. If you have any questions, please contact the Division of Banking and Financial Institutions at (406) 841-2920.

Questions?

Division of Banking and Financial Institutions
301 South Park, Suite 316, PO Box 200546, Helena, MT 59620
Phone: (406) 841-2920 Fax: (406) 841-2930

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