§ 6.2-311. (Effective October 1, 2010) Closed-end installment loans bysellers of goods or services.
A. Any seller of goods or services who extends credit under a closed-endinstallment credit plan or arrangement may impose finance charges at suchrate or rates as the seller and the purchaser have agreed. Deferrals andextensions of the time for payment, if allowed by a seller of goods orservices who extends credit under a closed-end installment credit plan or hisassignee, may be subject to a finance charge if agreed to in the originalcontract or at the time of the renewal or extension. No additional financecharge shall be made for the extension of credit under such a plan orarrangement. If the total finance charge on the transaction is precomputedaccording to the actuarial method, the finance charge shall be calculated onthe assumption that all scheduled payments will be made when due. The balanceon which such finance charge may be imposed may include the deferred portionof the sales price, costs and charges incidental to the transaction,including (i) any insurance premium financed in connection therewith and (ii)the amount actually paid or to be paid by the seller to discharge a securityinterest or lien on the property traded in. The payment by a lessor todischarge a security interest or lien on the property traded in may beincluded in the gross capitalized cost of the goods leased and, for purposesof this chapter and Chapter 6 (§ 55-106 et seq.) of Title 55, shall notconstitute a loan.
B. The debtor shall have the right to prepay in full on precomputedtransactions and receive a rebate of unearned finance charge determined inaccordance with the Rule of 78, as illustrated in § 6.2-403, or other methodelected by the seller under which the finance charge imposed does not exceedthe amount that results from application of the Rule of 78 on extensions ofcredit with an initial maturity of 61 months or less. On extensions of creditwith an initial maturity of more than 61 months, the debtor shall receive arebate computed under a method at least as favorable to the debtor as theactuarial method. The seller may also condition such rebate upon receiving aminimum of $25 in finance charges. This amount, to the extent not earned, maybe withheld from the rebate required hereunder.
C. In connection with such a credit plan, the seller may also:
1. Impose a late charge pursuant to § 6.2-400; and
2. Charge and collect a document fee as may be agreed upon by the seller andpurchaser in connection with such credit plan. The document fee shall (i) befor the preparation, handling, and processing of documents relating to thegoods or services and to the closing of the transaction and (ii) not beconsidered a finance charge for the purposes of this chapter.
D. Premiums for credit life insurance and credit accident and healthinsurance purchased by the debtor shall not be construed as an additionalcharge for the extension of credit if such insurance coverage is purchasedvoluntarily by the debtor. Premiums for property insurance on the goodspurchased or leased, including vendor's single interest insurance on suchgoods, shall not be construed as additional charges for the extension ofcredit if a clear and conspicuous statement in writing is furnished by theseller or lessor to the buyer or lessee setting forth the cost of theinsurance if obtained from or through the seller or lessor and stating thatthe buyer or lessee may choose the person through which the insurance is tobe obtained.
(1987, c. 622, § 6.1-330.77; 1988, c. 145; 1990, c. 338; 1999, cc. 62, 373;2010, c. 794.)
§ 6.2-311. (Effective October 1, 2010) Closed-end installment loans bysellers of goods or services.
A. Any seller of goods or services who extends credit under a closed-endinstallment credit plan or arrangement may impose finance charges at suchrate or rates as the seller and the purchaser have agreed. Deferrals andextensions of the time for payment, if allowed by a seller of goods orservices who extends credit under a closed-end installment credit plan or hisassignee, may be subject to a finance charge if agreed to in the originalcontract or at the time of the renewal or extension. No additional financecharge shall be made for the extension of credit under such a plan orarrangement. If the total finance charge on the transaction is precomputedaccording to the actuarial method, the finance charge shall be calculated onthe assumption that all scheduled payments will be made when due. The balanceon which such finance charge may be imposed may include the deferred portionof the sales price, costs and charges incidental to the transaction,including (i) any insurance premium financed in connection therewith and (ii)the amount actually paid or to be paid by the seller to discharge a securityinterest or lien on the property traded in. The payment by a lessor todischarge a security interest or lien on the property traded in may beincluded in the gross capitalized cost of the goods leased and, for purposesof this chapter and Chapter 6 (§ 55-106 et seq.) of Title 55, shall notconstitute a loan.
B. The debtor shall have the right to prepay in full on precomputedtransactions and receive a rebate of unearned finance charge determined inaccordance with the Rule of 78, as illustrated in § 6.2-403, or other methodelected by the seller under which the finance charge imposed does not exceedthe amount that results from application of the Rule of 78 on extensions ofcredit with an initial maturity of 61 months or less. On extensions of creditwith an initial maturity of more than 61 months, the debtor shall receive arebate computed under a method at least as favorable to the debtor as theactuarial method. The seller may also condition such rebate upon receiving aminimum of $25 in finance charges. This amount, to the extent not earned, maybe withheld from the rebate required hereunder.
C. In connection with such a credit plan, the seller may also:
1. Impose a late charge pursuant to § 6.2-400; and
2. Charge and collect a document fee as may be agreed upon by the seller andpurchaser in connection with such credit plan. The document fee shall (i) befor the preparation, handling, and processing of documents relating to thegoods or services and to the closing of the transaction and (ii) not beconsidered a finance charge for the purposes of this chapter.
D. Premiums for credit life insurance and credit accident and healthinsurance purchased by the debtor shall not be construed as an additionalcharge for the extension of credit if such insurance coverage is purchasedvoluntarily by the debtor. Premiums for property insurance on the goodspurchased or leased, including vendor's single interest insurance on suchgoods, shall not be construed as additional charges for the extension ofcredit if a clear and conspicuous statement in writing is furnished by theseller or lessor to the buyer or lessee setting forth the cost of theinsurance if obtained from or through the seller or lessor and stating thatthe buyer or lessee may choose the person through which the insurance is tobe obtained.
(1987, c. 622, § 6.1-330.77; 1988, c. 145; 1990, c. 338; 1999, cc. 62, 373;2010, c. 794.)
§ 6.2-311. (Effective October 1, 2010) Closed-end installment loans bysellers of goods or services.
A. Any seller of goods or services who extends credit under a closed-endinstallment credit plan or arrangement may impose finance charges at suchrate or rates as the seller and the purchaser have agreed. Deferrals andextensions of the time for payment, if allowed by a seller of goods orservices who extends credit under a closed-end installment credit plan or hisassignee, may be subject to a finance charge if agreed to in the originalcontract or at the time of the renewal or extension. No additional financecharge shall be made for the extension of credit under such a plan orarrangement. If the total finance charge on the transaction is precomputedaccording to the actuarial method, the finance charge shall be calculated onthe assumption that all scheduled payments will be made when due. The balanceon which such finance charge may be imposed may include the deferred portionof the sales price, costs and charges incidental to the transaction,including (i) any insurance premium financed in connection therewith and (ii)the amount actually paid or to be paid by the seller to discharge a securityinterest or lien on the property traded in. The payment by a lessor todischarge a security interest or lien on the property traded in may beincluded in the gross capitalized cost of the goods leased and, for purposesof this chapter and Chapter 6 (§ 55-106 et seq.) of Title 55, shall notconstitute a loan.
B. The debtor shall have the right to prepay in full on precomputedtransactions and receive a rebate of unearned finance charge determined inaccordance with the Rule of 78, as illustrated in § 6.2-403, or other methodelected by the seller under which the finance charge imposed does not exceedthe amount that results from application of the Rule of 78 on extensions ofcredit with an initial maturity of 61 months or less. On extensions of creditwith an initial maturity of more than 61 months, the debtor shall receive arebate computed under a method at least as favorable to the debtor as theactuarial method. The seller may also condition such rebate upon receiving aminimum of $25 in finance charges. This amount, to the extent not earned, maybe withheld from the rebate required hereunder.
C. In connection with such a credit plan, the seller may also:
1. Impose a late charge pursuant to § 6.2-400; and
2. Charge and collect a document fee as may be agreed upon by the seller andpurchaser in connection with such credit plan. The document fee shall (i) befor the preparation, handling, and processing of documents relating to thegoods or services and to the closing of the transaction and (ii) not beconsidered a finance charge for the purposes of this chapter.
D. Premiums for credit life insurance and credit accident and healthinsurance purchased by the debtor shall not be construed as an additionalcharge for the extension of credit if such insurance coverage is purchasedvoluntarily by the debtor. Premiums for property insurance on the goodspurchased or leased, including vendor's single interest insurance on suchgoods, shall not be construed as additional charges for the extension ofcredit if a clear and conspicuous statement in writing is furnished by theseller or lessor to the buyer or lessee setting forth the cost of theinsurance if obtained from or through the seller or lessor and stating thatthe buyer or lessee may choose the person through which the insurance is tobe obtained.
(1987, c. 622, § 6.1-330.77; 1988, c. 145; 1990, c. 338; 1999, cc. 62, 373;2010, c. 794.)
