2006 Code of Virginia § 6.1-272.1 - Rate of interest; late charges; processing fees

6.1-272.1. Rate of interest; late charges; processing fees.

A. For loans up to $2,500, a lender licensed under this chapter may chargeand receive interest at a single annual rate not to exceed 36 percent. Forloans of more than $2,500, such lender may charge and receive interest onlyat such single annual rate as shall be stated in the written loan contractsigned by the borrower. The annual rate of interest shall be charged onlyupon principal balances outstanding from time to time. Interest shall not becharged on an add-on basis and shall not be compounded or paid, deducted orreceived in advance. For the purpose of calculating interest hereunder, ayear may be any period of time consisting of 360 or 365 days.

B. Any lender licensed under this chapter may impose a late charge forfailure to make timely payment of any installment due on a debt, providedthat such late charge does not exceed five percent of the amount of suchinstallment payment and that the charge is specified in the contract betweensuch lender and the borrower. For purposes of this section, "timelypayment" means a payment made by the date fixed for payment or within aperiod of seven calendar days after such fixed date.

C. Any lender licensed under this chapter may charge and receive a processingfee, charged on the principal amount of the loan, for processing the loancontract. The processing fee shall be stated in the written loan contractsigned by the borrower. Such processing fee shall be deemed to constituteinterest charged on the principal amount of the loan for purposes ofdetermining whether the interest charged on a loan up to $2,500 exceeds thethirty-six percent annual rate limitation imposed by subsection A of thissection.

(1995, c. 2; 2001, c. 308.)