1. Notwithstanding the provisions of any other existing law, a retail installment transaction may include a finance charge not in excess of the following rates:

 a. Class 1. Any new motor vehicle designated by the manufacturer by a year model not earlier than the year in which the sale is made, an amount equivalent to one and three-fourths percent per month simple interest on the declining balance of the amount financed.
 b. Class 2. Any new motor vehicle not in class 1 and any used motor vehicle designated by the manufacturer by a year model of the same or not more than two years prior to the year in which the sale is made, an amount equivalent to two percent per month simple interest on the declining balance of the amount financed.
 c. Class 3. Any used motor vehicle not in class 2 and designated by the manufacturer by a year model more than two years prior to the year in which the sale is made, an amount equivalent to two and one-fourth percent per month simple interest on the declining balance of the amount financed.

Terms Used In Iowa Code 322.19

  • 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
  • following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
  • Manufacturer: includes a person who uses a completed motor vehicle manufactured by another person to construct a class "B" motor home as defined in section 321. See Iowa Code 322.2
  • month: means a calendar month, and the word "year" and the abbreviation "A. See Iowa Code 4.1
  • Motor vehicle: means any self-propelled vehicle subject to registration under chapter 321. See Iowa Code 322.2
  • Retail installment transaction: means any sale evidenced by a retail installment contract between a retail buyer and a retail seller wherein the retail buyer buys a motor vehicle from a retail seller at a time price payable in one or more installments. See Iowa Code 322.2
  • Truth in Lending Act: The Truth in Lending Act is a federal law that requires lenders to provide standardized information so that borrowers can compare loan terms. In general, lenders must provide information on Source: OCC
  • Vehicle: means any vehicle as defined in chapter 321. See Iowa Code 321H.2
  • year: means twelve consecutive months. See Iowa Code 4.1
 2. For purposes of this chapter, “amount financed” means as defined in section 537.1301. However, notwithstanding section 322.33, subsection 3, the amount financed may also include additional charges for the following, which shall not be included in the finance charge:

 a. A motor vehicle service contract as defined in section 523C.1.
 b. Voluntary debt cancellation coverage, whether insurance or debt waiver, which may be excluded from the finance charge under the federal Truth in Lending Act as defined in section 537.1302.
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