| (B) For contracts using the true daily earnings method,
the notice may read: "NOTICE TO THE BUYER--I WILL NOT SIGN THIS CONTRACT
BEFORE I READ IT OR IF IT CONTAINS ANY BLANK SPACES. I AM ENTITLED
TO A COPY OF THE CONTRACT I SIGN. UNDER THE LAW, I HAVE THE RIGHT
TO PAY OFF IN ADVANCE ALL THAT I OWE AND UNDER CERTAIN CONDITIONS
MAY SAVE A PORTION OF THE FINANCE CHARGE. I WILL KEEP THIS CONTRACT
TO PROTECT MY LEGAL RIGHTS."
(18) Buyer's acknowledgment of contract receipt.
(A) The following acknowledgments conform to the requirements
of Texas Finance Code, §348.112 if they appear directly above
the place for the buyer's signature in at least 10-point type that
is boldfaced, capitalized, underlined, or otherwise set out from surrounding
written material so as to be conspicuous. A creditor may choose the
most appropriate option:
(i) If the buyer's signature is dated. If this clause
is chosen, the copy must be mailed within a reasonable period of time.
A reasonable period of time would ordinarily be three days, excluding
Sundays and holidays. The model acknowledgment may read: "I AGREE
TO THE TERMS OF THIS CONTRACT. WHEN I SIGN THE CONTRACT, I WILL RECEIVE
THE COMPLETED CONTRACT. IF NOT, I UNDERSTAND THAT A COPY WILL BE MAILED
TO ME WITHIN A REASONABLE TIME."
(ii) If the buyer's signature is not dated. The model
acknowledgment may read: "I AGREE TO THE TERMS OF THIS CONTRACT. I
CONFIRM THAT BEFORE I SIGNED THIS CONTRACT, YOU GAVE IT TO ME, AND
I WAS FREE TO TAKE IT AND REVIEW IT. I RECEIVED THE COMPLETED CONTRACT
ON ___________ (MO.) (DAY) (YR.)."
(iii) If the buyer's signature is not dated. If this
clause is chosen, the copy must be mailed within a reasonable period
of time. The model acknowledgment may read: "I SIGNED THIS CONTRACT
ON _________ AND A COPY WILL BE MAILED TO ME WITHIN A REASONABLE TIME."
(iv) If the buyer's signature is not dated but the
contract contains the date of the transaction. The model acknowledgment
may read: "I AGREE TO THE TERMS OF THIS CONTRACT AND ACKNOWLEDGE RECEIPT
OF A COMPLETED COPY OF IT. I CONFIRM THAT BEFORE I SIGNED THIS CONTRACT,
YOU GAVE IT TO ME, AND I WAS FREE TO TAKE IT AND REVIEW IT."
(B) Acceptance of contract receipt. The model clause
regarding acceptance of contract receipt reads:
Attached Graphic
(19) OCCC notice. The following notice satisfies the
requirements of Texas Finance Code, §14.104 and §86.101
of this title (relating to Consumer Notifications). The telephone
number of the retail seller, creditor, or holder may be printed in
conjunction with the name and address of the retail seller, creditor,
or holder elsewhere on the contract or agreement provided the notice
required by Texas Finance Code, §14.104 is amended to direct
the reader's attention to the area of the contract where the telephone
number may be found. The OCCC notice reads: "For questions or complaints
about this contract, contact (insert name of creditor) at (insert
creditor's phone number and, at creditor's option, one or more of
the following: mailing address, fax number, website, e-mail address).
The Office of Consumer Credit Commissioner (OCCC) is a state agency,
and it enforces certain laws that apply to this contract. If a complaint
or question cannot be resolved by contacting the creditor, consumers
can contact the OCCC to file a complaint or ask a general credit-related
question. OCCC address: 2601 N. Lamar Blvd., Austin, Texas 78705.
Phone: (800) 538-1579. Fax: (512) 936-7610. Website: occc.texas.gov.
E-mail: consumer.complaints@occc.texas.gov."
(20) Finance charge refund method. If a contract uses
either the sum of the periodic balances method or the scheduled installment
earnings method to calculate a refund of the unearned finance charge,
the finance charge refund provision reads: "If I prepay in full, I
may be entitled to a refund of part of the Finance Charge." On contracts
using the true daily earnings method, this finance charge refund provision
should not be disclosed because it is not applicable.
(A) Contracts using the sum of the periodic balances
method.
(i) Name of method. The model clause to identify the
method of refunding finance charge reads: "You will figure the Finance
Charge refund by using the sum of the periodic balances method as
defined by the Texas Finance Commission rule."
(ii) Optional description of method. The creditor may
include the following additional description of the method. The model
clause reads: "You will figure the Finance Charge refund using the
sum of the periodic balances method as defined by the Texas Finance
Commission rule. The Finance Charge Refund will be computed upon the
entire Finance Charge minus the Acquisition Cost. I will not get a
refund if it is less than $1.00."
(iii) Optional description of method for use in contracts
for heavy commercial vehicles. At the creditor's option, a contract
for a heavy commercial vehicle, as defined in the Texas Finance Code,
may include the following description of the method. The model clause
reads: "You will figure the Finance Charge refund using the sum of
the periodic balances method as defined by the Texas Finance Commission
rule. The Finance Charge refund will be computed based upon the entire
Finance Charge calculated using the sum of the periodic balances method.
Then you will subtract the Acquisition Cost from that amount. I will
not get a refund if it is less than $1.00."
(B) Contracts using the scheduled installment earnings
method.
(i) Name of method. The model clause to identify the
method of refunding finance charge reads: "You will figure the Finance
Charge refund by the scheduled installment earnings method as defined
by the Texas Finance Commission rule."
(ii) Optional description of method for sales tax advance.
If sales tax is advanced, then the creditor may include the following
additional description of the method: "You will figure my refund by
deducting earned finance charges from the total Finance Charge. You
will figure earned finance charges by applying a daily rate to the
unpaid principal balance as if I paid all my payments on the date
due. If I prepay between payment due dates, you will figure earned
finance charges for the partial payment period. You do this by counting
the number of days from the due date of the prior payment through
the date I prepay. You then multiply that number of days times the
daily rate. The daily rate is 1/365th of the Annual Percentage Rate.
You will also add the acquisition cost of $25 (or $150 for a heavy
commercial vehicle) to the earned finance charge, so long as the total
of the earned finance charge and the acquisition cost does not exceed
the total Finance Charge disclosed in the contract. I will not get
a refund if it is less than $1.00."
(iii) Optional description of method for deferred sales
tax. If sales tax is deferred, then the creditor may include the following
additional description of the method: "You will figure my refund by
deducting earned finance charges from the total Finance Charge. You
will figure earned finance charges by applying a daily rate to the
unpaid principal balance subject to a finance charge as if I paid
all my payments on the date due. If I prepay between payment due dates,
you will figure earned finance charges for the partial payment period.
You do this by counting the number of days from the due date of the
prior payment through the date I prepay. You then multiply that number
of days times the daily rate. The daily rate is 1/365th of the contract
rate shown on the contract. You will also add the acquisition cost
of $25 (or $150 for a heavy commercial vehicle) to the earned finance
charge, so long as the total of the earned finance charge and the
acquisition cost does not exceed the total Finance Charge disclosed
in the contract. I will not get a refund if it is less than $1.00."
(C) Flexible contract forms designed to accommodate
alternative methods. Creditors may use a flexible contract form with
alternative earnings methods, so long as the method used on a particular
contract is permissible for that contract. The following clause illustrates
one way that this flexibility may be accomplished: "You will figure
the Finance Charge refund using the sum of the periodic balances method
as defined by the Texas Finance Commission rule if: this contract
is a Regular Payment Contract as defined by the Texas Finance Commission
rule, and this contract does not have a term greater than 61 months.
If this contract is not a Regular Payment Contract or if it has a
term greater than 61 months, you will figure the Finance Charge refund
using the scheduled installment earnings method as defined by the
Texas Finance Commission rule. I will not get a refund if it is less
than $1.00."
(21) Application of payments. In this provision, the
term "finance charge" should not be construed to have the same meaning
as Finance Charge as defined by the Truth in Lending Act. A default
or late charge is considered to be a finance charge under Texas law;
therefore, a default or late charge can be charged and collected as
part of the earned finance charge. At the creditor's option the creditor
may modify the application of payments language by adding "and late
charges" following the phrase "earned but unpaid finance charge."
The model clause reads:
Cont'd... |
