2009 California Civil Code - Section 1805.1-1805.9 :: Article 5. Finance Charge Limitation

SECTION 1805.1-1805.9

1805.1.  The holder of the contract shall not charge, collect, or
receive a finance charge which exceeds the dollar amount shown
pursuant to subdivision (b) of Section 1803.3, except to the extent
(a) caused by the holder's receipt of one or more payments under a
contract which provides for determination of the finance charge or a
portion thereof on the 365-day basis at a time or times other than as
originally scheduled, whether or not the parties enter into an
agreement pursuant to Section 1807.1, (b) permitted by paragraph (2),
(3), or (4) of subdivision (c) of Section 226.17 of Regulation Z, or
(3) permitted by Section 1805.8.
   No annual fee or charge shall be made in any retail installment

1805.2.  Contracts may be payable in successive monthly, semimonthly
or weekly installments.

1805.4.  The finance charge shall be inclusive of all charges
incident to investigating and making the contract and for the
extension of the credit provided for in the contract, and no fee,
expense or other charge whatsoever shall be taken, received, reserved
or contracted for except as otherwise provided in this chapter.
   The seller or holder of a retail installment contract may charge
and collect a fee not to exceed fifteen dollars ($15) for the return
by a depository institution of a dishonored check, negotiable order
of withdrawal, or share draft issued in connection with the retail
installment contract. The fee is not included in charges as defined
in this chapter or in determining the applicable charges which may be
made under this chapter.

1805.6.  (a) Notwithstanding the provisions of any contract to the
contrary, except as provided in subdivision (b) or (c), no retail
seller shall assess any finance charge for goods purchased under a
retail installment contract until the goods are in the buyer's
   (b) A finance charge may be assessed for such undelivered goods,
as follows:
   (1) From the date when such goods are available for pickup by the
buyer and the buyer is notified of their availability, or
   (2) From the date of purchase, when such goods are delivered or
available for pickup by the buyer within 10 days of the date of
   (c) In the case of a home improvement contract as defined in
Section 7151.2 of the Business and Professions Code, a finance charge
may be assessed from the approximate date of commencement of the
work as set forth in the home improvement contract.

1805.7.  All contracts entered into between a buyer and a seller on
or after January 1, 1983, shall provide for the calculation of the
finance charge contemplated by item (1) of subdivision (a) of Section
1805.1 on the simple-interest basis if the date on which the final
installment is due, according to the original terms of the contract,
is more than 62 months after the date of the contract.

1805.8.  The maximum rate of finance charge which may be imposed on
amounts advanced by the holder subsequent to the execution of the
contract for insurance, repairs to or preservation of the goods, or
preservation of the holder's security interest therein, shall not
exceed the annual percentage rate disclosed pursuant to item (b) of
Section 1803.3.

1805.9.  No contract shall provide for a finance charge which is
determined in part by the precomputed basis and in part by the
simple-interest basis, except for any finance charge permitted by
Section 1805.8.

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