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HomeFinancial CodeDiv. 5Ch. 11Art. 6§ 16102 Foreign Credit Union Interest Exemption

§ 16102 Foreign Credit Union Interest Exemption

Financial Code·California
AI Summary·Official Text·Key Terms·Related Statutes·References
AI SummaryVerified

§ 16102 Foreign Credit Union Interest Exemption

This law says that a credit union from another state that has a branch in California can ignore California’s limits on how much interest it can charge, but it still has to follow all other California rules and can’t charge more than its home‑state allows.

Key Takeaways

  • •Out‑of‑state credit unions with a California branch are exempt from California’s interest‑rate limits.
  • •They must still follow every other California law that applies to their business.
  • •They cannot charge an interest rate higher than the limit in the state where they are originally chartered.

Example

A credit union based in Nevada opens a branch office in Los Angeles.

Because it has a California branch, the Nevada credit union does not have to follow California’s usury caps and can charge the interest rate allowed in Nevada, but it still must obey all other California laws and cannot charge a higher rate than Nevada permits.

AI-generated — May contain errors. Not legal advice. Always verify source.

Official Source
View on CA.gov

§ 16102 Foreign Credit Union Interest Exemption

(a) Any foreign (other state) credit union that is authorized to and does maintain a California branch office or California facility is exempted from the restrictions of Section 1 of Article XV of the California Constitution relating to rates of interest upon the loan or forbearance of any money, goods, or things in action or on accounts after demand. (b) This section does not exempt a foreign (other state) credit union or any subsidiary from complying with all other laws and regulations governing the business in which the foreign (other state) credit union or subsidiary is engaged. (c) This section creates and authorizes an exempt class of persons pursuant to Section 1 of Article XV of the California Constitution. (d) This section does not authorize a foreign (other state) credit union or any subsidiary to charge an interest rate on a loan or forbearance in excess of any limitation that exists under the laws of its home state. (Added by Stats. 2000, Ch. 612, Sec. 3. Effective January 1, 2001.)

Last verified: January 11, 2026

Key Terms

foreign (other state) credit unionCalifornia branch officeCalifornia facilitySection 1 of Article XV of the California Constitutioninterest ratehome state

Related Statutes

  • § 16100 Foreign Credit Union Activities
  • § 16101 Foreign Credit Union Rules
  • § 16006 Foreign Credit Union Branch Fees
  • § 16007 Foreign Credit Union Service
  • § 16013 Foreign Credit Union Conflicts

References

  • Official text at leginfo.legislature.ca.gov
  • California Legislature. Financial Code. Section 16102.
View Official Source