OK, I'll try to explain this better. The minimum FC is a difficult concept to grasp, or it always has been for me.
1. Under no circumstance can you exceed the usury limitations with the exception of charging an origination fee allowable under the IN Code. The origination fee does not count against usury but it does have to be disclosed in the APR.
2. IN allows you to contract for a minimum finance charge of $36. HOWEVER you cannot contract for this charge if your expected earn interest does not exceed $36. The $36.00 minimum finance charge is a "prepayment penalty" if the loan does not go to term and your earned interest does not reach $36 (or the amount of interest contracted for) . If your loan, based on the rate, is only to accrue $25 for the term of the loan, then you can only contract for a $25.00 minimum finance charge. In other words you cannot collect more interest than contracted for and the interest you contract for cannot exceed the usury.
You can contact Mark Tarpey at the IN DFI at (800) 382-4880. Mark has always been very helpful (and patient) with my questions over the past.
Last edited by dpersfull; 01/20/04 06:15 PM.
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The opinions expressed are mine and they are not to be taken as legal advice.