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HomeFinancial CodeDiv. 9Ch. 2Art. 3§ 22311 Loan Add-On Purchase Ban

§ 22311 Loan Add-On Purchase Ban

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

§ 22311 Loan Add-On Purchase Ban

Key Takeaways

  • •You can't be forced to buy extra stuff when you take out a loan.
  • •Insurance for the loan is okay, but nothing else can be required.
  • •The law makes sure lenders don’t trick you into buying unnecessary things.

Example

You take out a car loan, and the lender says you must buy an extended warranty to get the loan.

The lender can’t force you to buy the warranty—it’s against the law. You can say no and still get the loan.

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

Official Source
View on CA.gov

§ 22311 Loan Add-On Purchase Ban

No person in connection with or incidental to the making of any loan regulated by this division may require the borrower to contract for purchase, or agree to purchase, any other thing in connection with the loan. A policy of insurance of the type specified in Section 22313 and credit life and disability insurance is not prohibited by this section. A policy of insurance of the type defined by subdivision (a) of Section 12640.02 of the Insurance Code shall not be deemed to be a collateral sale, purchase, or agreement within the terms of this section or of Section 22201 or 22312. (Added by Stats. 1994, Ch. 1115, Sec. 2. Effective January 1, 1995. Operative July 1, 1995, by Sec. 5 of Ch. 1115.)

Last verified: January 23, 2026

Key Terms

loanborrowerpolicy of insurancecollateral saleSection 22313credit life and disability insuranceSection 12640.02 of the Insurance Code

Related Statutes

  • § 22300 Loan Interest Charging Rules
  • § 22310 Loan Rebate Exemption Rules
  • § 22313 Insurance For Loan Collateral
  • § 22316 Lot Book Report Costs
  • § 22319 Trustee Reconveyance Fee Collection

References

  • Official text at leginfo.legislature.ca.gov
  • California Legislature. Financial Code. Section 22311.
View Official Source