(a) Prescribed form and content. If an extension of
a pawn transaction is made, a written memorandum must be used to document
the extension of the maturity date. The memorandum of extension must
be provided in one of the two prescribed formats as provided in Figure:
7 TAC §85.407(a)(1) or Figure: 7 TAC §85.407(a)(2) of this
section. The printed portions of the memorandum must be legible and
all the information must be reproduced on all parts.
(1) Memorandum of extension including amount due at
redemption. The following figure provides an acceptable memorandum
of extension that includes information regarding the amount due at
redemption. Information regarding the amount due at redemption is
optional on this form and may be deleted as authorized by subsection
(b) of this section.
Attached Graphic
(2) Memorandum of extension not including amount due
at redemption. The following figure provides an acceptable memorandum
of extension that does not include information regarding the amount
due at redemption.
Attached Graphic
(b) Modification of prescribed forms. Modification
of the spacing of the forms is allowed. If a pawnbroker uses the form
provided in Figure: 7 TAC §85.407(a)(1), the information regarding
the amount due at redemption may be deleted. Other changes to the
forms must be approved by the commissioner in writing and in advance.
(c) Distribution of copies. The original memorandum
must be given to the person paying for the extension or, if paid by
mail, sent to the pledgor. The location of all memorandum copies relating
to a particular pawn ticket must be documented:
(1) in the electronic system (if the memorandum of
extension form can be reproduced in its actual original printed format);
or
(2) in the numerical pawn ticket file.
(d) Pawn service charge. The daily rate of finance
charge may not exceed 1/30th of the finance charge shown on the pawn
ticket. The amount a pledgor pays for the extension may not exceed
the maximum of the total amount that could be charged divided by the
daily rate. The pledgor and pawnshop may negotiate any amount of pawn
service charge for the extension not to exceed the maximum amount
authorized by Texas Finance Code, Chapter 371, Subchapter D.
(e) Early redemption. If a pledgor negotiates an extension
and subsequently pays a pawn transaction in full prior to the original
maturity date, the original terms of the original pawn transaction
are restored. The maximum pawn service charge that may be collected
is calculated from the date of the original transaction to the date
of redemption. Any charge collected for the extension must be credited
against the total pawn service charge. Any remaining balance may be
collected from the pledgor.
(f) Renewal or extension of open pawn transaction.
Any open pawn transaction may be renewed by payment of pawn service
charges accrued to the date of renewal or may be extended, unless
the pawn ticket provides that the pawn transaction is not eligible
for renewal or extension.
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Source Note: The provisions of this §85.407 adopted to be effective October 1, 2000, 25 TexReg 9435; amended to be effective September 19, 2005, 30 TexReg 5337; amended to be effective June 7, 2010, 35 TexReg 3471; amended to be effective July 1, 2014, 39 TexReg 3392 |