Louisiana Revised Statutes 6:969.16 – Maximum deferral charges
Terms Used In Louisiana Revised Statutes 6:969.16
- Consumer: means a natural person who enters into a consumer loan or consumer credit sale of a motor vehicle to be used primarily for personal, family, or household purposes. See Louisiana Revised Statutes 6:969.6
- Contract: A legal written agreement that becomes binding when signed.
- Contract: means the consumer's retail installment contract, note, agreement, or other evidence of indebtedness executed in connection with a motor vehicle credit transaction. See Louisiana Revised Statutes 6:969.6
- Precomputed transaction: means a motor vehicle credit transaction under which loan finance charges or credit service charges are computed in advance over the entire scheduled term of the transaction and capitalized into the face amount of the contract. See Louisiana Revised Statutes 6:969.6
- Pro rata: refers to a method of computing deferral charges by dividing the precomputed loan finance charge or precomputed credit service charge by the total number of days in the contract term and multiplying the sum by the number of days that are deferred. See Louisiana Revised Statutes 6:969.6
- Simple interest transaction: means a motor vehicle credit transaction under which loan finance charges or credit service charges are assessed by application of a contractual simple interest rate or rates to the unpaid principal balance of the contract. See Louisiana Revised Statutes 6:969.6
A. With respect to a precomputed transaction, the parties before or after default may agree in writing to a deferral of all or part of one or more unpaid installments, and the extender of credit may make and collect a charge not exceeding the contract rate previously stated to the consumer calculated without regard to differences in the lengths of months, but proportionately for a part of a month, counting each day as one-thirtieth of a month. A deferral charge may be collected at the time it is assessed or at any time thereafter. Deferral charges on a precomputed transaction may be computed on a pro rata basis or any other method of calculation that does not yield a greater sum than the maximum rates permitted in this Part. In lieu of the above, the entire unpaid balance of the transaction may be deferred by charging an amount equal to the contract rate of interest under the transaction times the balance at the time of deferral for the period of deferral. In such a case, the transaction maturity date will be extended by the number of months that the balance is deferred.
B. The parties may agree in writing at the time of a precomputed transaction that if an installment is not paid within ten days after its due date, the extender of credit may unilaterally grant a deferral and make charges as provided in this Section. No deferral charge may be made for a period after the date that the extender of credit elects to accelerate the maturity of the agreement. A delinquency charge made by the extender of credit on an installment may not be retained if a deferral charge is made pursuant to this Section with respect to the period of delinquency.
C. In addition to the continued assessment of loan finance charges or credit service charges that may be assessed on the outstanding balance of a simple interest transaction, the parties may before or after default agree in writing to a deferral of all or part of one or more unpaid installments, and the extender of credit may make and collect an additional deferral charge in an amount not to exceed twenty-five dollars. This deferral charge may be collected at the time it is assessed or at any time thereafter.
D. The extender of credit, in addition to the deferral charge, may make appropriate charges for insurance for the extended period and the amount of these charges which is not paid in cash may be added to the amount for the purpose of calculating the deferral charge.
Acts 1999, No. 794, §1, eff. July 2, 1999.