Massachusetts General Laws ch. 255D sec. 11 – Finance charges, computation, rates; multiple agreements prohibited
Section 11. A. No fee, expense or other charge whatsoever shall be taken, received, reserved or contracted for, except as provided in this section and in sections sixteen to twenty-two, inclusive, and except for official fees, and for the items expressly provided for in the retail installment sale agreement as set forth in section nine.
Terms Used In Massachusetts General Laws ch. 255D sec. 11
- 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.
- 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
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
B. An installment seller may, in a retail installment sales agreement, contract for, and if so contracted for the holder thereof may charge, receive, and collect a finance charge computed on the original amount financed of the contract or obligation not in excess of an annual percentage rate of twenty-one per cent.
C. On agreements payable in successive periodic installments substantially equal in amount, the maximum permissible finance charge shall be computed on the original amount financed. On agreements providing for installments extending for a period less than or greater than one year, the finance charge shall be computed proportionately.
The finance charge may be computed on the basis of a full month for any fractional month period in excess of fifteen days.
When a retail installment sale agreement provides for unequal or irregular installments, the finance charge shall be at the effective rate provided for in this section, having due regard for the schedule of installments.
The date on which the finance charge begins to accrue shall be deemed to be a different date from the date of the transaction if the goods or services purchased are not available for delivery on the date of the transaction and the date such finance charge shall begin to accrue shall be the date when such goods or services are available for delivery.
D. No installment seller shall permit any person, or any husband and wife jointly or severally, to be obligated, either directly or contingently to said seller, under more than one retail installment sales agreement executed at the same time.