Texas § 342.002 INTEREST COMPUTATION METHODS.

Texas Statutes

§ 342.002 — INTEREST COMPUTATION METHODS.

Texas § 342.002

Code FIFinance Code

This text of Texas § 342.002 (INTEREST COMPUTATION METHODS.) is published on Counsel Stack Legal Research, covering Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

Tex. Finance Code Code Ann. § 342.002 (2026).

Text

Sec. 342.002. INTEREST COMPUTATION METHODS.

(a)The scheduled installment earnings method is a method to compute an interest charge by applying a daily rate to the unpaid balance of the principal amount as if each payment will be made on its scheduled installment date. A payment received before or after the due date does not affect the amount of the scheduled principal reduction.

(b)The true daily earnings method is a method to compute an interest charge by applying a daily rate to the unpaid balance of the principal amount. The earned finance charge is computed by multiplying the daily rate by the number of days the principal balance is outstanding.

(c)For the purposes of Subsections (a) and (b), the daily rate is 1/365th of the equivalent contract rate.

(d)Interest under the scheduled

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Sec. 342.002. INTEREST COMPUTATION METHODS. (a) The scheduled installment earnings method is a method to compute an interest charge by applying a daily rate to the unpaid balance of the principal amount as if each payment will be made on its scheduled installment date. A payment received before or after the due date does not affect the amount of the scheduled principal reduction.
(b) The true daily earnings method is a method to compute an interest charge by applying a daily rate to the unpaid balance of the principal amount. The earned finance charge is computed by multiplying the daily rate by the number of days the principal balance is outstanding.
(c) For the purposes of Subsections (a) and (b), the daily rate is 1/365th of the equivalent contract rate.
(d) Interest under the scheduled installment earnings method or true daily earnings method may not be compounded.

Legislative History

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.19(a), eff. Sept. 1, 1999; Acts 1999, 76th Leg., ch. 909, Sec. 2.05, eff. Sept. 1, 1999. Amended by: Acts 2013, 83rd Leg., R.S., Ch. 784 (S.B. 1251 ), Sec. 1, eff. September 1, 2013.