1. With respect to a precomputed consumer credit transaction, the parties may contract for a delinquency charge on any installment not paid in full within ten days after its due date, as originally scheduled or as deferred, in an amount not exceeding the greater of either of the following:
a. Five percent of the unpaid amount of the installment, or a maximum of twenty dollars.
b. The deferral charge that would be permitted to defer the unpaid amount of the installment for the period that it is delinquent.
2. A delinquency charge under subsection 1, paragraph "a", may be collected only once on an installment however long it remains in default. No delinquency charge may be collected with respect to a deferred installment unless the installment is not paid in full within ten days after its deferred due date. A delinquency charge may be collected at the time it accrues or at any time afterward.
3. No delinquency charge may be collected under subsection 1, paragraph "a", on an installment which is paid in full within ten days after its scheduled or deferred installment due date even though an earlier maturing installment or a delinquency or deferral charge on an earlier installment may not have been paid in full. For purposes of this subsection payments are applied first to current installments and then to delinquent installments.
4. With respect to open-end credit obtained pursuant to a credit card issued by the creditor which entitles the cardholder to purchase or lease goods or services from at least one hundred persons not related to the card issuer, the parties may contract for a delinquency charge on any payment not paid in full when due, as originally scheduled or as deferred, in an amount up to fifteen dollars.
5. A delinquency charge under subsection 4 may be collected only once on a payment however long it remains in default. A delinquency charge shall not be collected with respect to a deferred payment unless the payment is not paid in full on or before its deferred due date. A delinquency charge may be collected at the time it accrues or at any time afterward.
6. A delinquency charge shall not be collected under subsection 4 on a payment which is paid in full on or before its scheduled or deferred due date even though an earlier maturing payment or a delinquency or deferred charge on an earlier payment has not been paid in full. For purposes of this subsection, payments are applied first to amounts due for the current billing cycle and then to delinquent payments.
7. If the differential treatment of subsection 4 based on the number of persons honoring a credit card is found to be unconstitutional, the parties may contract for the delinquency charge as described in subsection 4 in any consumer credit transaction pursuant to open-end credit, and the other conditions provided in this section relating to delinquency charges remain in effect.
8. With respect to open-end credit obtained pursuant to a credit card issued by the creditor which entitles the cardholder to purchase or lease goods or services from less than one hundred persons not related to the card issuer, the parties may contract for a delinquency charge on any payment not paid in full within thirty days after its due date, as originally scheduled or as deferred, in an amount not to exceed ten dollars. A delinquency charge shall not be collected more than once on any one payment, regardless of the length of time the payment remains delinquent.
[C66, 71, 73, § 536.13(7), 536A.23(3); C75, 77, 79, 81, § 537.2502]
89 Acts, ch 68, §4; 93 Acts, ch 124, §1; 95 Acts, ch 113, §1; 96 Acts, ch 1114, § 3--;5
Referred to in § 537.2510
Iowa General Assembly
Search: Iowa Code 1997
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