2006 Code of Virginia § 6.1-330.78 - Open-end sales and loan plans

6.1-330.78. Open-end sales and loan plans.

A. Notwithstanding any provision of this chapter other than 6.1-330.71, anyseller or lender engaged in the extension of credit under an open-end creditor similar plan under which a finance charge is imposed upon the obligor, ifpayment in full of the unpaid balance is not received at the place designatedby the creditor prior to the next billing date (which shall be at leasttwenty-five days later than the prior billing date), may impose financecharges and other charges and fees at such rates and in such amounts andmanner as may be agreed upon by the seller or lender and the obligor.

B. Notwithstanding the provisions of 6.1-330.71 and subject to theprovisions of 8.9A-204.1, any loan made under this section may be securedin whole or in part by a subordinate mortgage or deed of trust on residentialreal estate improved by the construction thereon of housing consisting of oneto four family dwelling units.

C. Any application form or preapproved written solicitation for an open-endcredit card account to be used for personal, family, or household purposeswhich is mailed on or after January 1, 1988, to a consumer residing in thisCommonwealth by or on behalf of a creditor, whether or not the creditor islocated in this Commonwealth, other than an application form or solicitationincluded in a magazine, newspaper, or other publication distributed bysomeone other than the creditor, shall contain or be accompanied by any ofthe following disclosures:

1. A disclosure of each of the following if applicable:

a. Any periodic rate or rates that may be applied to the account, expressedas an annual percentage rate or rates. If the account is subject to avariable rate, the creditor may instead disclose the rate as of a specificdate and indicate that the rate may vary, or identify the index and anyamount or percentage added to, or subtracted from, that index and used todetermine the rate.

b. Any membership or participation fee that may be imposed for availabilityof a credit card account.

c. Any transaction fee that may be imposed on purchases, or any other chargeor fee that may be imposed, expressed as an amount or as a percentage of thetransaction, as applicable.

d. Any grace period or free period during which the consumer may repay thefull balance reflected on a billing statement which is attributable topurchases of goods or services from the creditor or from merchantsparticipating in the credit card plan, without the imposition of additionalfinance charges. The creditor shall either disclose the number of days ofthat period, calculated from the closing date of the prior billing cycle tothe date designated in the billing statement sent to the consumer as the dateby which that payment must be received to avoid additional finance charges,or describe the manner in which the period is calculated. If the creditordoes not provide such a period for purchases, the disclosure shall soindicate;

2. A disclosure that satisfies the initial disclosure requirements ofRegulation Z; or

3. If a creditor is now or hereafter required under federal law to makedisclosures of the terms applicable to a credit card account in connectionwith application forms or solicitations, the creditor shall be deemed to havecomplied with the requirements of this subsection if the creditor complieswith the federal disclosure requirements. The disclosure of any transactionfee that may be imposed on purchases, or any other charge or fee, shall bewritten on any such application form or preapproved written solicitation.

D. An open-end credit or similar plan between a seller or lender and anobligor shall be governed solely by federal law, and by the laws of theCommonwealth of Virginia unless otherwise expressly agreed in writing by theparties.

(1987, cc. 622, 639, 714; 1992, Sp. Sess., c. 4; 1997, c. 112.)