California Code of Regulations
Title 10 - Investment
Chapter 3 - Commissioner of Financial Protection and Innovation
Subchapter 3 - Commercial Financing Disclosures
Section 942 - Estimated Annual Percentage Rate - Sales-Based Financing

Universal Citation: 10 CA Code of Regs 942

Current through Register 2024 Notice Reg. No. 38, September 20, 2024

(a) When calculating the estimated payments and reasonably anticipated true-ups for sales-based financing, a provider shall use the estimated monthly sales, income or receipts projection described in subdivision (b) of section 930 or the internal estimated sales, income, or receipts projection described in subdivision (a)(3) of section 931, accounting for:

(1) Specified payment amounts;

(2) Changes to the split rate over time;

(3) Contractual provisions requiring a minimum payment amount;

(4) Payments required when the recipient's timely payment or series of payments falls below a contracted threshold; and

(5) Any other finance charges that may be reasonably anticipated based upon the estimated monthly sales, income, or receipts projection or the provider's internal estimated sales, income, or receipts projection.

(b) When calculating estimated monthly cost, finance charge, term, and annual percentage rate for the sales-based financing, a provider shall use the estimated monthly, income or receipts sales projection described in subdivision (b) of section 930, or internal estimated sales, income, or receipts projection described in subdivision (a)(3) of section 931, accounting for the following:

(1) Specified payment amounts;

(2) Changes to the split rate over time;

(3) Contractual provisions requiring a minimum payment amount;

(4) Payments required when the recipient's timely payment or series of payments falls below a contracted threshold;

(5) Reasonably anticipated true-ups; and

(6) Any other finance charges that may be reasonably anticipated based upon the estimated monthly sales, income, or receipts projection or the provider's internal estimated sales, income, or receipts projection.

1. New section filed 6-9-2022; operative 12-9-2022 pursuant to Government Code section 11343.4(b)(2) (Register 2022, No. 23). Transmission deadline specified in Government Code section 11346.4(b) extended 60 calendar days pursuant to Executive Order N-40-20 and an additional 60 calendar days pursuant to Executive Order N-71-20. Filing deadline specified in Government Code section 11349.3(a) extended 60 calendar days pursuant to Executive Order N-40-20 and an additional 60 calendar days pursuant to Executive Order N-71-20.

Note: Authority cited: Sections 321 and 22804, Financial Code. Reference: Sections 22800, 22802, 22803 and 22804, Financial Code.

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