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Usury Act, 1968 (Act No. 73 of 1968)

6I. Consequence of notice relating to payment before due date of outstanding principal debt and finance charges in terms of certain leasing transactions if such transactions not terminated

 

 

Referenced by:

 

1) Where the principal debt and finance charges owing by a lessee in connection with a leasing transaction have, in terms of an agreement between himself and the lessor concerned, to be paid in instalments, including finance charges, over a period in the future, and the lessee by notice in writing in accordance with a provision, as contemplated in section 3A(1)(a), of the instrument of debt concerned, has notified the lessor of his intention to pay the outstanding balance of the principal debt and finance charges thereon (not being the final instalment) in one amount before the due date thereof on the date, as contemplated in section 3A(1)(c), stated in such notice, and such transaction is not to be terminated by such payment, such transaction shall be deemed to be a transaction in respect of which payment of the principal debt and finance charges thereon has to be made in a manner other than by way of regular payments, and such lessor shall recalculate the finance charges payable in respect of such transaction--
a) in accordance with the provisions of section 2(5) at the annual finance charge rate provided for in such instrument of debt; and
b) as from the date of such transaction until the date as stated in the notice contemplated in section 3A(1)(c) or the date on which the minimum period, as contemplated in section 3A(1)(b), provided for in the instrument of debt concerned, expired, whichever date is the later date,

and the finance charges so recalculated, notwithstanding anything to the contrary contained in such instrument of debt, shall be the maximum finance charges which may be demanded, received or recovered in respect of such transaction by such lessor.

 

2) The provisions of section 6K relating to the duties of a lessor shall apply mutatis mutandis to a leasing transaction in respect of which the outstanding balance of the principal debt and finance charges thereon have been paid in the manner referred to in subsection (1).