{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/6.2-401.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/6.2-401.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/6.2-401.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/6.2-401.html"}],"law_id":85289,"edition_id":1,"section_id":85289,"structure_id":14626,"section_number":"6.2-401","catch_line":"Acceleration clause in note evidencing installment loan; effect of acceleration","history":"1987, c. 622, \u00a7 6.1-330.89; 1990, c. 338; 1991, cc. 171, 365; 2010, c. 794.","full_text":"A\n\nAny note or other contract evidencing an installment loan or other installment sales obligation with add-on interest may provide that the entire unpaid loan balance, at the option of the holder, shall become due and payable upon default in payment of any installment without impairing the negotiability of the note, if otherwise negotiable.B\n\nUpon such acceleration, the holder of the contract of indebtedness shall not be entitled to judgment for unearned interest, but the balance owing shall be computed as follows:1\n\nOn loans payable in equal periodic installments with an initial maturity and corresponding amortization period not exceeding 61 months, the accelerated balance shall be calculated as if the borrower had made a voluntary prepayment and obtained as of the date of acceleration an interest credit based upon the Rule of 78 rebate method as defined in § 6.2-403; and2\n\nOn other loans, the accelerated balance shall be calculated under a method at least as favorable to the borrower as the actuarial method.C\n\nThe accelerated balance shall bear interest at the rate shown, or that should have been shown as the annual percentage rate under a truth in lending disclosure pursuant to federal law if the transaction was a consumer credit transaction.","order_by":null,"text":{"0":{"id":305604,"text":"Any note or other contract evidencing an installment loan or other installment sales obligation with add-on interest may provide that the entire unpaid loan balance, at the option of the holder, shall become due and payable upon default in payment of any installment without impairing the negotiability of the note, if otherwise negotiable.","type":"section","prefixes":["A"],"prefix":"A","entire_prefix":"A","prefix_anchor":"A","level":1,"next_prefix":"B"},"1":{"id":305605,"text":"Upon such acceleration, the holder of the contract of indebtedness shall not be entitled to judgment for unearned interest, but the balance owing shall be computed as follows:","type":"section","prefixes":["B"],"prefix":"B","entire_prefix":"B","prefix_anchor":"B","level":1,"prior_prefix":"A","next_prefix":"B1"},"2":{"id":305606,"text":"On loans payable in equal periodic installments with an initial maturity and corresponding amortization period not exceeding 61 months, the accelerated balance shall be calculated as if the borrower had made a voluntary prepayment and obtained as of the date of acceleration an interest credit based upon the Rule of 78 rebate method as defined in § 6.2-403; and","type":"section","prefixes":["B","1"],"prefix":"1","entire_prefix":"B1","prefix_anchor":"B1","level":2,"prior_prefix":"B","next_prefix":"B2"},"3":{"id":305607,"text":"On other loans, the accelerated balance shall be calculated under a method at least as favorable to the borrower as the actuarial method.","type":"section","prefixes":["B","2"],"prefix":"2","entire_prefix":"B2","prefix_anchor":"B2","level":2,"prior_prefix":"B1","next_prefix":"C"},"4":{"id":305608,"text":"The accelerated balance shall bear interest at the rate shown, or that should have been shown as the annual percentage rate under a truth in lending disclosure pursuant to federal law if the transaction was a consumer credit transaction.","type":"section","prefixes":["C"],"prefix":"C","entire_prefix":"C","prefix_anchor":"C","level":1,"prior_prefix":"B2"}},"ancestry":[{"id":14626,"edition_id":1,"name":"Late Charges and Rebates of Unearned Interest","identifier":"1","label":"article","depth":4,"order_by":1,"parent_id":12854,"metadata":{},"date_created":"2026-06-26 03:48:58","date_modified":"2026-06-26 03:48:58","permalink":{"id":263465,"object_type":"structure","relational_id":14626,"identifier":"1","token":"6.2\/I\/4\/1","url":"\/6.2\/I\/4\/1\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12854,"edition_id":1,"name":"Certain Lending Practices","identifier":"4","label":"chapter","depth":3,"order_by":1,"parent_id":12853,"metadata":{},"date_created":"2026-06-26 03:43:56","date_modified":"2026-06-26 03:43:56","permalink":{"id":263463,"object_type":"structure","relational_id":12854,"identifier":"4","token":"6.2\/I\/4","url":"\/6.2\/I\/4\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12853,"edition_id":1,"name":"General Provisions","identifier":"I","label":"subtitle","depth":2,"order_by":1,"parent_id":12852,"metadata":{},"date_created":"2026-06-26 03:43:56","date_modified":"2026-06-26 03:43:56","permalink":{"id":263251,"object_type":"structure","relational_id":12853,"identifier":"I","token":"6.2\/I","url":"\/6.2\/I\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12852,"edition_id":1,"name":"Financial Institutions and Services","identifier":"6.2","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:43:56","date_modified":"2026-06-26 03:43:56","permalink":{"id":263249,"object_type":"structure","relational_id":12852,"identifier":"6.2","token":"6.2","url":"\/6.2\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":85650,"structure_id":14626,"section_number":"6.2-400","catch_line":"Amount of late charge; when charge can be made","url":"\/6.2-400\/","token":"6.2\/I\/4\/1\/6.2-400","metadata":false},{"id":85289,"structure_id":14626,"section_number":"6.2-401","catch_line":"Acceleration clause in note evidencing installment loan; effect of acceleration","url":"\/6.2-401\/","token":"6.2\/I\/4\/1\/6.2-401","metadata":false},{"id":80258,"structure_id":14626,"section_number":"6.2-402","catch_line":"Notice of use of Rule of 78 rebate method","url":"\/6.2-402\/","token":"6.2\/I\/4\/1\/6.2-402","metadata":false},{"id":78834,"structure_id":14626,"section_number":"6.2-403","catch_line":"The Rule of 78","url":"\/6.2-403\/","token":"6.2\/I\/4\/1\/6.2-403","metadata":false},{"id":56171,"structure_id":14626,"section_number":"6.2-404","catch_line":"When use of Rule of 78 prohibited or permitted","url":"\/6.2-404\/","token":"6.2\/I\/4\/1\/6.2-404","metadata":false},{"id":63347,"structure_id":14626,"section_number":"6.2-405","catch_line":"References to sections regulating rebates of unearned interest and prepayment penalties","url":"\/6.2-405\/","token":"6.2\/I\/4\/1\/6.2-405","metadata":false}],"previous_section":{"id":85650,"structure_id":14626,"section_number":"6.2-400","catch_line":"Amount of late charge; when charge can be made","url":"\/6.2-400\/","token":"6.2\/I\/4\/1\/6.2-400","metadata":false},"next_section":{"id":80258,"structure_id":14626,"section_number":"6.2-402","catch_line":"Notice of use of Rule of 78 rebate method","url":"\/6.2-402\/","token":"6.2\/I\/4\/1\/6.2-402","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/6.2-401\/","history_text":"

This law was first created in 1987. The record of its establishment is cataloged in chapter 622 of that year\u2019s edition of \u201cActs of Assembly,\u201d the annual state publication listing all changes made to the Code of Virginia in that year. Unfortunately, the 1987 \u201cActs\u201d aren\u2019t available online. It has been modified 3 times. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. Those modifications are as follows: in 1990, chapter 338; in 1991, chapters 171 and 365; in 2010, chapter 794<\/a>.<\/p>","references":false,"refers_to":[{"id":78834,"section_number":"6.2-403","catch_line":"The Rule of 78","order_by":null,"url":"\/6.2-403\/"}],"permalink":{"id":263471,"object_type":"law","relational_id":85289,"identifier":"6.2-401","token":"6.2\/I\/4\/1\/6.2-401","url":"\/6.2-401\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/6.2-401\/","token":"6.2\/I\/4\/1\/6.2-401","dublin_core":{"Title":"Acceleration clause in note evidencing installment loan; effect of acceleration","Type":"Text","Format":"text\/html","Identifier":"\u00a7 6.2-401","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

A.<\/span> Any note or other contract<\/span> evidencing an installment loan or other installment sales obligation with add-on interest may provide that the entire unpaid loan balance, at the option of the holder, shall become due and payable upon default<\/span> in payment of any installment without impairing the negotiability of the note, if otherwise negotiable. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

B.<\/span> Upon such acceleration, the holder of the contract<\/span> of indebtedness shall not be entitled to judgment<\/span> for unearned interest, but the balance owing shall be computed as follows: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> On loans payable in equal periodic installments with an initial maturity and corresponding amortization period not exceeding 61 months, the accelerated balance shall be calculated as if the borrower had made a voluntary prepayment and obtained as of the date of acceleration an interest credit based upon the Rule of 78 rebate method as defined in § 6.2-403<\/a>; and <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> On other loans, the accelerated balance shall be calculated under a method at least as favorable to the borrower as the actuarial method. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

C.<\/span> The accelerated balance shall bear interest at the rate shown, or that should have been shown as the annual percentage rate under a truth in lending disclosure pursuant to federal law<\/span> if the transaction was a consumer credit transaction. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nACCELERATION CLAUSE IN NOTE EVIDENCING INSTALLMENT LOAN; EFFECT OF ACCELERATION\n(\u00a7 6.2-401)\n\nA. Any note or other contract evidencing an installment loan or other\ninstallment sales obligation with add-on interest may provide that the entire\nunpaid loan balance, at the option of the holder, shall become due and payable\nupon default in payment of any installment without impairing the negotiability\nof the note, if otherwise negotiable.\n\nB. Upon such acceleration, the holder of the contract of indebtedness shall not\nbe entitled to judgment for unearned interest, but the balance owing shall be\ncomputed as follows:\n\n 1. On loans payable in equal periodic installments with an initial maturity\n and corresponding amortization period not exceeding 61 months, the accelerated\n balance shall be calculated as if the borrower had made a voluntary prepayment\n and obtained as of the date of acceleration an interest credit based upon the\n Rule of 78 rebate method as defined in § 6.2-403; and\n\n 2. On other loans, the accelerated balance shall be calculated under a method\n at least as favorable to the borrower as the actuarial method.\n\nC. The accelerated balance shall bear interest at the rate shown, or that should\nhave been shown as the annual percentage rate under a truth in lending\ndisclosure pursuant to federal law if the transaction was a consumer credit\ntransaction.\n\nHISTORY: 1987, c. 622, \u00a7 6.1-330.89; 1990, c. 338; 1991, cc. 171, 365; 2010, c.\n794.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}