HARRY HUGHES, Governor                                     1653

CHAPTER 4 51

(House Bill 444)

AN ACT concerning

Revolving Credit Plans and Closed End Credit - Permissible

Charges

FOR the purpose of limiting the charges that may be imposed by

credit grantors on borrowers as a result of delinquent
payment and payment by dishonored checks; prohibiting
certain fees from being considered permissible; making
stylistic changes; and generally relating to revolving
credit plans and closed end credit.

BY repealing and reenacting, with amendments,

Article - Commercial Law

Section 12-910 and 12-1008

Annotated Code of Maryland

(1983 Replacement Volume and 1985 Supplement)

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF

MARYLAND, That the Laws of Maryland read as follows:

Article - Commercial Law

12-910.

(a)  If the agreement governing a revolving credit plan
permits, a credit grantor may:

(1)  For a nonconsumer borrower, charge a higher
periodic percentage rate of interest on outstanding unpaid
payments or portions of payments under the plan which are in
default; and

(2)  For any borrower, impose [a]:

(I) A late or delinquency charge [upon] ON
payments or portions of payments; AND

(II) IF PAYMENT IS MADE WITH A CHECK THAT IS
DISHONORED ON THE SECOND PRESENTMENT, A CHARGE NOT TO EXCEED $10.

(b)  (1) No more than one late or delinquency charge may be
imposed for any single scheduled payment or portion regardless of
the period during which it remains in default.

(2) For the purpose of this subsection, all payments
by the borrower shall be applied to satisfaction of scheduled
payments in the order in which they become due.