§ 25A-32. Rebates on prepayment. - North Carolina Statutes

§25A‑32.  Rebates on prepayment.

Notwithstanding any provisionin a consumer credit installment sale contract to the contrary, any buyer maysatisfy the debt in full at any time before maturity, and in so satisfying suchdebt, shall receive a rebate, the amount of which shall be computed under the"rule of 78's," as follows:

"The amount of suchrebate shall represent as great a proportion of the finance charge (less aprepayment charge of ten percent (10%) of the unpaid balance, not to exceedtwenty‑five dollars ($25.00)) as the sum of the periodical time balancesafter the date of prepayment in full bears to the sum of all the periodicaltime balances under the schedule of payments in the original contract." Norebate is required if the amount thereof is less than one dollar ($1.00).

If the prepayment is madeotherwise than on the due date of an installment, it shall be deemed to havebeen made on the installment due date nearest in time to the actual date ofpayment.

If a seller obtains a judgmenton a debt arising out of a consumer credit installment sale or the sellerrepossesses the collateral securing the debt, the seller shall credit the buyerwith a rebate as if the payment in full had been made on the date the judgmentwas obtained or 15 days after the repossession occurred. If the seller obtainsa judgment and repossesses the collateral, the seller shall credit the buyerwith a rebate as if payment in full had been made on the date of the judgmentor 15 days after the repossession, whichever occurs earlier. (1971,c. 796, s. 1.)