) Upon prepayment in full of a precomputed consumer loan, the unearned portion of the loan finance charge shall be rebated to the debtor. If the obligation of the debtor pursuant to a consumer loan contains a portion of the loan finance charge by reason of discount or otherwise, the unearned portion of the loan finance charge shall be rebated to the debtor upon prepayment. If the earned portion of the loan

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finance charge is an amount less than the amount of the minimum retained charge, the lender may retain the amount of the minimum charge. The minimum retained charge is an amount which is the greater of either $10.00 or an amount, not exceeding Twenty-Five Dollars ($25.00), which is 5% of the principal. If the required rebate is less than One Dollar ($1.00), no rebate need be made.
(2) Upon prepayment in full of a consumer loan other than a precomputed loan or one pursuant to a revolving loan account, the lender may collect from the debtor a charge equal to the amount of the minimum retained charge.

(3) The unearned loan finance charge is a fraction of the loan finance charge of which the numerator is the sum of the periodic balances scheduled to follow the computational period in which prepayment occurs, and the denominator is the sum of all periodic balances under either the loan agreement or, if the balance owing resulted from a refinancing agreement (§ 3205) or a consolidation agreement (§ 3206) under the refinancing agreement or consolidation agreement.
(4) In this section:

(a) periodic balance means the amount scheduled to be outstanding on the last day of a computational period before deducting the payment, if any, scheduled to be made on that day;

(b) computational period means one (1) month if one-half (1/2) or more of the intervals between scheduled payments under the agreement is one month, or more, shall otherwise mean one week, except that the total interval prior to the due date of the first scheduled instalment shall always be considered one computational period.

(5) (a) If the computational period is one (1) month: (i) and the number of days between the date of a loan, refinancing or consolidation and the due date of the first scheduled installment is less than twenty-five (25) days or more than thirty-five (35) days but not more than forty-five (45) days, the unearned loan finance charge shall be increased by an adjustment for each day by which the interval is less than thirty (30) days and, at the option of the lender, may be reduced by an adjustment for each day by which the interval is more than thirty (30) days; the adjustment for each day

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shall be one-thirtieth (1/30th) of that part of the loan finance charge earned in the computational period prior to the due date of the first scheduled instalment assuming that period to be one (1) month; (ii) and the interval between the date of the loan, refinancing or consolidation and the final scheduled payment date is a number of full months plus an additional number of days less than a full month, the additional number of days shall be considered a computational period only if sixteen (16) days, or more;
(b) If the computational period is one (1) week: (i) and the number of days between the date of the loan, refinancing or consolidation and the due date of the first scheduled instalment is less than five (5) days or more than nine (9) days but not more than eleven (11) days, the unearned loan finance charge shall be increased by an adjustment for each day by which the interval is less than seven (7) days and, at the option of the lender, may be reduced by an adjustment for each day by which the interval is more than seven (7) days; the adjustment for each day shall be one-seventh (1/7th) of that part of the loan finance charge earned in the computational period prior to the due date of the first scheduled instalment assuming that period to be one (1) month; (ii) and the interval between the date of the loan, refinancing or consolidation and the final scheduled payment date is a number of full weeks plus an additional number of days less than a full week, the additional number of days shall be considered a computational period only if four (4) days, or more.
(6) If a deferral has been agreed to pursuant to § 3204, the unearned loan finance charge shall be computed without regard to the deferment. The amount of deferment charge earned at the date of prepayment shall be calculated. If the deferment charge earned is less than the deferment charge paid, the difference shall be added to the amount of the unearned loan finance charge. Any part of a deferment charge which has been earned but not paid, shall be subtracted from any rebate of loan finance charge otherwise due, or shall be added to the unpaid balance.

(7) This Section does not preclude the collection or retention by the lender of delinquency charges made pursuant to § 3203.

(8) If the maturity is accelerated for any reason and judgment is obtained, the debtor is entitled to the same rebate as though the agree- ment had been prepaid at the date judgment is entered.

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(9) If the debtor dies prior to the maturity of the agreement and the unpaid balance is paid by the proceeds of credit insurance on the life of the debtor, the estate of the debtor is entitled to the same rebate as though the debtor had prepaid the agreement on the date the proceeds of the credit insurance are paid to the lender, but no later than ten (10) days after proof of death is furnished.

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ARTICLE 3
DISCLOSURE
[Repealed by P.L. 16-73.]

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ARTICLE 4
LIMITATIONS ON AGREEMENTS AND PRACTICES