Printable Format16a-3-402. (UCCC) Limitation on default charges. Except for reasonable expenses incurred in realizing on a security interest, the agreement with respect to a consumer credit transaction may not provide for any charges as a result of default by the consumer other than those authorized by K.S.A. 16a-1-101 et seq., and amendments thereto. A provision in violation of this section shall be unenforceable.
History: L. 1973, ch. 85, § 57; L. 2024, ch. 6, § 78; January 1, 2025.
KANSAS COMMENT, 2010
The U3C limits the credit-related charges a creditor may impose on a consumer not only at the outset of the contract but also at the default stage. Except for delinquency charges (K.S.A. 16a-2-502), collection costs and attorneys' fees (K.S.A. 16a-2-507), and expenses arising from realizing on collateral authorized by the UCC (K.S.A. 84-9-615), the creditor may impose no collection or default charges on a consumer.
Law Review and Bar Journal References:
"History & Overview of the Uniform Consumer Credit Code," Ryan E. Hodge, J.K.T.L.A. Vol. XXVI, No. 3, 8 (2003).
Attorney General's Opinions:
Savings and loan association code; examinations; acceptance of examinations made by Federal Savings and Loan Insurance Corporation. 83-113.
Consumer credit transactions; prohibition on prepayment penalties; preemption as to national banks. 83-132.
Attorney fees; national direct student loans. 86-113.