| (a) If prepayment in full is made by cash, renewal, or otherwise after the first installment due date, the authorized lender must refund or credit to the borrower the unearned interest by the scheduled installment earnings method authorized by §83.751 of this title (relating to Scope) and identified in the loan agreement as the chosen refund method. If prepayment in full or demand for payment in full occurs during an installment period, the lender may retain an interest charge for previous elapsed periods and the number of days beginning after the installment due date and ending on the date of the prepayment or demand in full. (b) If prepayment is made in full before the first installment due date, an authorized lender may retain an interest charge for each elapsed day between the date of the loan and the date of prepayment. The interest charge may not exceed the amount of interest allowed under the true daily earnings method for the same time period. The authorized lender must refund or credit to the borrower the unearned interest. (c) In calculating the amount of the refund of the unearned interest, an authorized lender must consider any installments that were deferred. |
