Short Answer:
No.
Explanation:
The Alabama Consumer Credit Act, Ala. Code §§ 5-19-1 et seq. ("Mini-Code"), does not require a creditor to obtain a license to originate a motor vehicle retail installment sale contract.
The Mini-Code requires any creditor who makes consumer loans to Alabama residents to obtain a Consumer Credit Act License from the Superintendent of Banks. Ala. Code § 5-19-22(a). However, the Mini-Code does not require a creditor to obtain a license to originate a credit sale.
The Mini-Code defines the term "credit sale" to mean any sale in which credit is extended or arranged by a seller who is a creditor. The term includes any contract in the form of a bailment or lease if the bailee or lessee contracts to pay as compensation for use a sum substantially equivalent to or greater than the aggregate value of the property or services involved and it is agreed that the bailee or lessee may become for no other or a nominal consideration the owner of the property upon full compliance with the bailee's or lessee's obligations under the contract. The term does not include a rental-purchase agreement which is subject to the Rental-Purchase Chapter, Ala. Code §§ 8-25-1 et seq. Ala. Code § 5-19-1(4).
In a motor vehicle retail installment sale, credit is arranged by the seller. As a result, a motor vehicle retail installment sale contract is a credit sale under the Mini-Code, and a creditor does not need a license to originate a motor vehicle retail installment sale contract.
Last Revision*:
July 2, 2020 Show Redlined Changes
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