537.2401 Finance charge for consumer loans not pursuant to open-end credit. 1. Except as provided with respect to a finance charge for loans pursuant to open-end credit under section 537.2402 and loans secured by a certificate of title of a motor vehicleunder section 537.2403, a lender may contract for and receive a finance charge not exceedingthe maximum charge permitted by the laws of this state or of the United States for similarlenders, and, in addition, with respect to a consumer loan, a supervised financial organizationor a mortgage lender may contract for and receive a finance charge, calculated according tothe actuarial method, not exceeding twenty-one percent per year on the unpaid balance of theamount financed. Except as provided in section 537.2403, this subsection does not prohibita lender from contracting for and receiving a finance charge exceeding twenty-one percentper year on the unpaid balance of the amount financed on consumer loans if authorized byother provisions of the law. 2. This section does not limit or restrict the manner of calculating the finance charge, whether by way of add-on, discount, or otherwise, so long as the rate of the finance chargedoes not f the law. 2. This section does not limit or restrict the manner of calculating the finance charge, whether by way of add-on, discount, or otherwise, so long as the rate of the finance chargedoes not exceed that permitted by this section or the laws of this state or of the UnitedStates. The finance charge permitted by this section or the laws of this state or of the UnitedStates may be calculated by determining the single annual percentage rate as required tobe disclosed to the consumer pursuant to section 537.3201 which, when applied accordingto the actuarial method to the unpaid balances of the amount financed, will yield the financecharge for that transaction which would result from applying any graduated rates permittedby this section or the laws of this state or of the United States to the transaction on theassumption that all scheduled payments will be made when due. If the loan is a precomputedconsumer credit transaction, the finance charge may be calculated on the assumption thatall scheduled payments will be made when due, and the effect of prepayment is governedby section 537.2510. 3. edconsumer credit transaction, the finance charge may be calculated on the assumption thatall scheduled payments will be made when due, and the effect of prepayment is governedby section 537.2510. 3. Except as provided in subsection 5, the term of a loan for the purposes of this section commences on the date the loan is made. Any month may be counted as one-twelfth of a yearbut a day is counted as one-three hundred sixty-fifth of a year. Subject to classifications anddifferentiations the lender may reasonably establish, a part of a month in excess of fifteendays may be treated as a full month if periods of fifteen days or less are disregarded andthat procedure is not consistently used to obtain a greater yield than would otherwise bepermitted. The administrator may adopt rules not inconsistent with the Truth in Lending Actwith respect to treating as regular other minor irregularities in amount or time. 4. Subject to classifications and differentiations the lender may reasonably establish, the lender may make the same finance charge on all amounts financed within a specified range.A finance charge so made does not violate subsection 1, if both of the following are applicable: a. blish, the lender may make the same finance charge on all amounts financed within a specified range.A finance charge so made does not violate subsection 1, if both of the following are applicable: a. When applied to the median amount within each range, it does not exceed the maximum permitted by that subsection. b. When applied to the lowest amount within each range, it does not produce a rate of finance charge exceeding the rate calculated according to paragraph 'a' by more than eightpercent of the rate calculated according to paragraph 'a'. 5. With respect to an insurance premium loan, the term of the loan commences on the earliest inception date of a policy or contract of insurance for which the premium is financed. [C75, 77, 79, 81, §537.2401; 82 Acts, ch 1153, §16, 18(1)]83 Acts, ch 124, §26; 2007 Acts, ch 26, §1Referred to in §533.316, 537.1301, 537.2308, 537.2504, 537.2505 Sat Dec 23 01:40:03 2023 Iowa Code 2024, Section 537.2401 (18, 0)
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