CHAPTER 754

An Act to amend and reenact § 6.1-284 of the Code of Virginia, relating
to charges of interest in advance by an industrial loan association,
installment payments, acceleration upon default, fees and duration
and amount of loans.

[H 756]

Approved April 5, 1968

Be it enacted by the General Assembly of Virginia:

1. That § 6.1-234, of the Code of Virginia be amended and reenacted
as follows:

§ 6.1-234. Interest in advance; installment payments; acceleration
upon default; investigation fees; fines; duration and amount of loan.—
An industrial loan association may charge in advance the legal rate of
interest upon the entire amount of the loan, and such loans may be repaid
in weekly, monthly or other periodical installments, with the privilege to
the association to declare the entire unpaid balance due and payable in the
event of default in the payment of any installment for a period of thirty
days; and such associations may also charge an investigation fee not ex-
ceeding two per centum of the amount of the loan. In the event the com-
bined charges for interest and investigation fee would not amount to one
dollar, such industrial loan association shall be entitled to a minimum
charge of one dollar in lieu thereof. It may fix in its bylaws such fines as
it will charge for the nonpayment of any installments of any loan; but
such fines shall not be more than ten percent of the amount of the payment
in which default is made, and shall not be cumulative.

As used in this section the phrase “charge in advance” when applied
to installment loans means that the interest may be added to the principal
amount of the note but may not be deducted from tt. ;

Any natural person borrowing from an industrial loan association
shall have the right to anticipate payment of his debt at any time and
shall receive a rebate for any unearned interest, which rebate shall be
computed in accordance with the Standard Rule of 78 and shall be reduced
by an anticipation premium equal to that portion of the contract interest
allocable under such rule to the next six payments.

No loans shall be made for a longer period than ten years, nor for a
greater amount in the aggregate to any person, firm or corporation than
twenty percent of the paid-in capital stock and capital surplus of the
association.