Difference between revisions of "Direct Sales, Future Performance, and Time Share Contracts (11:V)"
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Part 5 of the ''BPCPA'' deals with the disclosure of the cost of consumer credit. | Part 5 of the ''BPCPA'' deals with the disclosure of the cost of consumer credit. | ||
The Acts set out disclosure requirements, as well as advertising requirements for both fixed and open credit. The basic distinction between fixed and open credit is that open credit involves multiple advances and does not establish the total amount advanced under the agreement. However, open credit can be subject to an overall credit limit. Fixed credit is a credit arrangement that is normally based on a fixed initial advance and a predetermined payment schedule. Under s 105 of the ''BPCPA'', the creditor is obliged to compensate borrowers for contraventions of the Act. | The Acts set out disclosure requirements, as well as advertising requirements for both fixed and open credit. The basic distinction between fixed and open credit is that '''open credit''' involves multiple advances and does not establish the total amount advanced under the agreement. However, open credit can be subject to an overall credit limit. '''Fixed credit''' is a credit arrangement that is normally based on a fixed initial advance and a predetermined payment schedule. Under s 105 of the ''BPCPA'', the creditor (lender) is obliged to compensate borrowers for contraventions of the Act. | ||
The rules for credit transactions under the ''BPCPA'' are: | The rules for credit transactions under the ''BPCPA'' are: | ||
*Under s 66, lenders are required to furnish debtors with a written statement of disclosure. Consult ss 66 | * Under s 66, lenders are required to furnish debtors (borrowers) with a written statement of disclosure. Consult ss 66 – 93 for the specific requirements pertaining to your client’s situation. | ||
*Under ss 59 | * Under ss 59 – 64, certain requirements flow from the advertising of certain aspects of credit, such as interest-free periods, interest rates, and cost of credit. | ||
*Under Division 4 of Part 5, a borrower has certain rights, such as being able to choose an insurer and to cancel optional services. | * Under Division 4 of Part 5, a borrower has certain rights, such as being able to choose an insurer and to cancel optional services. | ||
*Under s 99, where a credit card is lost or stolen, the holder is not liable for any charges incurred after notice in person or by registered mail has been given to the issuer of the card. In the case of purchases made before notice is given, an individual is only liable for $50 or up to the credit limit remaining on the card, whichever is less. This protection does not extend to situations where a credit card is used with a personal identification number at an ATM (see ''Plater v Bank of Montreal'' | * Under s 99, where a credit card is lost or stolen, the holder is not liable for any charges incurred after notice in person or by registered mail has been given to the issuer of the card. In the case of purchases made before notice is given, an individual is only liable for $50 or up to the credit limit remaining on the card, whichever is less. This protection does not extend to situations where a credit card is used with a personal identification number at an ATM (see ''Plater v Bank of Montreal'', [1988] BCWLD 986, 22 BCLR (2d) 308 (Co Ct)). | ||
=== 1. Notice Required for Increased Interest Rates === | === 1. Notice Required for Increased Interest Rates === | ||
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=== 2. Unsolicited Credit Cards === | === 2. Unsolicited Credit Cards === | ||
A credit card issuer must not issue a credit card to an individual that has not applied for one (s 96). This does not affect the ability of a credit card issuer to provide a renewal or replacement card that has been applied for. | |||
=== 3. Prepaid Purchase Cards (Gift Certificates and Gift Cards) === | |||
The terms of prepaid purchase cards are regulated under ss 56.1 – 56.5. A prepaid purchase card is a card, written certificate or other voucher with a monetary value that is issued or sold to a person in exchange for the future supply of goods or services. These include gift cards or gift certificates. | |||
Under s 56.2, cards are prevented from being issued with an expiry date. ''Prepaid Purchase Cards Regulation'', BC Reg. 292/2008 contains exemptions from the expiry date prohibition. These include cards issued for a specific good or service, cards issued for a charitable purpose, and cards issued to a person who provides nothing of value in exchange. | |||
== G. High-Cost Loans (Payday Loans) == | == G. High-Cost Loans (Payday Loans) == | ||