Massachusetts General Laws ch. 140D sec. 1 – Definitions
Section 1. For the purpose of this chapter, the following words shall, unless the context indicates otherwise, have the following meanings:
Terms Used In Massachusetts General Laws ch. 140D sec. 1
- Annual percentage rate: The cost of credit at a yearly rate. It is calculated in a standard way, taking the average compound interest rate over the term of the loan so borrowers can compare loans. Lenders are required by law to disclose a card account's APR. Source: FDIC
- Contract: A legal written agreement that becomes binding when signed.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Deed: The legal instrument used to transfer title in real property from one person to another.
- Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
- Finance charge: The total cost of credit a customer must pay on a consumer loan, including interest. The Truth in Lending Act requires disclosure of the finance charge. Source: OCC
- Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Open-end credit: A credit agreement (typically a credit card) that allows a customer to borrow against a preapproved credit line when purchasing goods and services. The borrower is only billed for the amount that is actually borrowed plus any interest due. (Also called a charge account or revolving credit.) Source: OCC
- Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
- Personal property: All property that is not real property.
- Real property: Land, and all immovable fixtures erected on, growing on, or affixed to the land.
”Accepted credit card”, any credit card which the cardholder has requested and received or has signed or has used, or authorized another to use, for the purpose of obtaining money, property, labor, or services on credit.
”Adequate notice”, a printed notice to a cardholder which sets forth the pertinent facts clearly and conspicuously so that a person against whom it is to operate could reasonably be expected to have noticed it and understood its meaning. Such notice may be given to a cardholder by printing the notice on any credit card, or on each periodic statement of account, issued to the cardholder, or by any other means reasonably assuring the receipt thereof by the cardholder.
”Advertisement”, a commercial message in any medium that promotes, directly or indirectly, a credit transaction.
”Agricultural products”, products relating to agricultural, horticultural, viticultural and dairy products, livestock, wildlife, poultry, bees, forest products, fish and shellfish, and any products thereof, including processed and manufactured products, and any and all products raised or produced on farms and any processed or manufactured products thereof.
”Agricultural purpose”, a purpose relating to the production, harvest, exhibition, marketing, transportation, processing, or manufacture of agricultural products by a natural person who cultivates, plants, propagates or nurtures those agricultural products, including but not limited to the acquisition of farmland, real property with a farm residence, and personal property and services used primarily in farming.
”Bureau”, the federal Bureau of Consumer Financial Protection.
”Cardholder”, any person to whom a credit card is issued or any person who has agreed with the card issuer to pay obligations arising from the issuance of a credit card to another person.
”Card issuer”, any person who issues a credit card, or the agent of such person with respect to such card.
”Commissioner”, the commissioner of banks.
”Consumer”, used as an adjective, with reference to a credit transaction, characterizes the transaction as one in which the party to whom credit is offered or extended is a natural person, and the money, property, or services which are the subject of the transactions are primarily for personal, family, or household purposes.
”Credit”, the right granted by a creditor to a debtor to defer payment of debt or to incur debt and defer its payment.
”Credit card”, any card, plate, coupon book, or other credit device existing for the purpose of obtaining money, property, labor, or services on credit.
”Creditor”, a person who both (1) regularly extends, whether in connection with loans, sales or property or services, or otherwise, consumer credit which is payable by agreement in more than four installments or for which the payment of a finance charge is or may be required, and (2) is the person to whom the debt arising from the consumer credit transaction is initially payable on the face of the evidence of indebtedness or, if there is no such evidence of indebtedness, by agreement. Notwithstanding the preceding sentence, in the case of an open-end credit plan involving a credit card, the card issuer and any person who honors the credit card and offers a discount which is a finance charge is a creditor. For the purposes of the requirements imposed under this chapter, the term ”creditor” shall also include card issuers whether or not the amount due is payable by agreement in more than four installments or the payment of a finance charge is or may be required, and the commissioner shall, by regulation, apply these requirements to such card issuers, to the extent appropriate, even though the requirements are by their terms applicable only to creditors offering open-end credit plans.
”Credit sale”, any sale in which the seller is a creditor. The term includes any contract in the form of a bailment or lease if the bailee or lessee contracts to pay as compensation for use a sum substantially equivalent to or in excess of the aggregate value of the property and services involved and it is agreed that the bailee or lessee will become, or for no other or a nominal consideration has the option to become, the owner of the property upon full compliance with his obligations under the contract.
”Discount”, a reduction made from the regular price. The term ”discount” shall not mean a surcharge.
”Dwelling”, a residential structure or mobile home which contains one to four family housing units, or individual units of condominiums or cooperatives.
”Material disclosure”, the disclosure, as required by this chapter, of the annual percentage rate, the method of determining the finance charge and the balance upon which a finance charge will be imposed, the amount of the finance charge, the amount to be financed, the total of payments, the number and amount of payments, and the due dates or periods of payments scheduled to repay the indebtedness.
”Open-end-credit plan”, a plan under which the creditor reasonably contemplates repeated transactions, which prescribes the terms of such transactions, and which provides for a finance charge which may be computed from time to time on the outstanding unpaid balance. A credit plan which is an open-end-credit plan within the meaning of the preceding sentence is an open-end-credit plan even if credit information is verified from time to time.
”Organization”, a corporation, government or governmental subdivision or agency, trust, estate, partnership, cooperative, or association.
”Person”, a natural person or an organization.
”Regular price”, the tag or posted price charged for the property or service if a single price is tagged or posted, or the price charged for the property or service when payment is made by use of an open-end-credit plan or credit card if either (1) no price is tagged or posted, or (2) two prices are tagged or posted, one of which is charged when payment is made by use of an open-end-credit plan or credit card and the other when payment is made by use of cash, check, or similar means. For purposes of this definition, payment by check, draft or other negotiable instrument which may result in the debiting of an open-end-credit plan or a credit card holder’s open end account shall not be considered payment by use of the plan or the account.
”Residential mortgage transaction”, a transaction in which a mortgage, deed of trust, purchase money security interest arising under an installment sales contract, or equivalent consensual security interest is created or retained against the consumer’s dwelling to finance the acquisition or initial construction of such dwelling.
”Surcharge”, any means of increasing the regular price to a cardholder which is not imposed upon customers paying by cash, check or similar means.
”Unauthorized use”, a use of a credit card by a person other than the cardholder who does not have actual, implied, or apparent authority for such use and from which the cardholder receives no benefit.
Any reference to any requirement imposed under this chapter or any provision thereof includes reference to the regulations of the commissioner of banks under this chapter or the provision thereof in question.
The disclosure of an amount or percentage which is greater than the amount or percentage required to be disclosed under this chapter does not in itself constitute a violation of this chapter.