SC Code § 37-3-410 (2021)
2021 South Carolina Code of Laws|Title 37 - Consumer Protection Code|Chapter 3 - Loans|Section 37-3-410. Lender subject to claims and defenses arising from sale and leases.

 (1) A lender, except the issuer of a lender credit card, who with respect to a particular transaction, makes a consumer loan to enable a debtor to buy or lease from a particular seller or lessor property or services is subject to all claims and defenses of the debtor against the seller or lessor arising from that sale or lease of the property or services if:  (a) the lender knows that the seller or lessor arranged for the extension of credit by the lender for a commission, brokerage, or referral fee;  (b) the lender is a person related to the seller or lessor, unless the relationship is remote or is not a factor in the transaction;  (c) the seller of lessor guarantees the loan or otherwise assumes the risk of loss by the lender upon the loan;  (d) the lender directly supplies the seller or lessor with the contract document used by the debtor to evidence the loan, and the seller or lessor has knowledge of the credit terms and participates in preparation of the document;  (e) the loan is conditioned upon the debtor's purchase or lease of the property or services from the particular seller or lessor, but the lender's payment of proceeds of the loan to the seller or lessor does not in itself establish that the loan was so conditioned; or  (f) the lender, before he makes the consumer loan, has knowledge or, from his course of dealing with the particular seller or lessor or his records, notice of substantial complaints by other buyers or lessees of the particular seller's or lessor's failure or refusal to perform his contracts with them and of the particular seller's or lessor's failure to remedy his defaults within a reasonable time after notice to him of the complaints.  (2) A claim or defense of a debtor specified in subsection (1) may be asserted against the lender under this section only if the debtor has made a good faith attempt to obtain satisfaction from the seller or lessor with respect to the claim or defense and then only to the extent of the amount owing to the lender with respect to the sale or lease of the property or services as to which the claim or defense arose at the time the lender has written notice of the claim or defense. Written notice of the claim or defense may be given before the attempt specified in this subsection. For the purposes of this section, written notice is any written notification other than notice on a coupon, billing statement or other payment medium or material supplied by the lender which sets forth or otherwise enables the creditor to identify the name and account number (if any) of the debtor.  (3) For the purpose of determining the amount owing to the lender with respect to the sale or lease:  (a) payments received by the lender after consolidation of two or more consumer loans, except pursuant to a revolving loan account, are deemed to have been applied first to the payment of the loans first made; if the loans consolidated arose from loans made on the same day, payments are deemed to have been applied first to the smallest loan; and  (b) payments received for a revolving loan account are deemed to have been applied first to the payment of loan finance charges in the order of their entry to the account and then to the payment of debts in the order in which the entries of the debts are made to the account.  (4) An agreement may not limit or waive the claims or defenses of a debtor under this section.  HISTORY: 1962 Code Section 8-800.280; 1974 (58) 2879; 1976 Act No. 686 Section 28; 1982 Act No. 385, Section 37.