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#1265282 - 10/12/09 03:57 AM APR OF 372.30%
AAB Offline
Member
Joined: Nov 2001
Posts: 91
I have a DDL customer questioning her ARP of 372.30% The line advanced in mid September for $100 and she was charged a $2 transfer fee. Is there any way that I can provide proof or documentation to her that this is correct? When I hand calculated the finance charge and interest rate, it was exactly on to what the computer says and what her loan term states.

Any help would be greatly appreciated.

Thank you.

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Lending Compliance
#1265322 - 10/12/09 03:09 PM Re: APR OF 372.30% AAB
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 83,227
Galveston, TX
Send her your hand calculation and the formula for calculating the APR.
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#1265324 - 10/12/09 03:10 PM Re: APR OF 372.30% AAB
Richard Insley Online
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Richard Insley
Joined: Oct 2000
Posts: 10,179
Toano, VA
Section 226.14(c)(3) seems to fit the situation you describe.
If the finance charge imposed during the billing cycle is or includes a charge relating to a specific transaction during the billing cycle (even if the total finance charge also includes any other minimum, fixed, or other charge not due to the application of a periodic rate), by dividing the total finance charge imposed during the billing cycle by the total of all balances and other amounts on which a finance charge was imposed during the billing cycle without duplication, and multiplying the quotient (expressed as a percentage) by the number of billing cycles in a year, except that the annual percentage rate shall not be less than the largest rate determined by multiplying each periodic rate imposed during the billing cycle by the number of periods in a year.

Also see Appendix F for illustrations.
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