The holder of a retail installment contract or contracts may, upon agreement in writing with the buyer, refinance the remaining amount owing on the contract or contracts by providing for a new schedule of installment payments. The holder may charge and contract for the payment of a refinance charge by the buyer and collect and receive the same, but such refinance charge shall be based upon the amount refinanced, plus any additional cost of insurance and of official fees incident to the refinancing, after the deduction of a refund credit in an amount equal to that to which the buyer would have been entitled under Section 1806.3 if he or she had prepaid in full his or her obligations under the contract or contracts. The agreement for refinancing may also provide for the payment by the buyer of the additional cost to the holder of the contract or contracts of premiums for continuing in force, until the maturity of the contract or contracts as refinanced, any insurance coverages provided for therein, subject to Section 1803.5. The refinancing agreement shall set forth:
(a) The amount of the existing outstanding balance to be refinanced, which consists of the remaining amount owing to be refinanced.
(b) The amount of any refund credit.
(c) The difference between subdivisions (a) and (b), which is the net outstanding balance to be refinanced.
(d) Any additional cost of insurance and of official fees to the buyer.
(e) The sum of subdivisions (c) and (d), which is the amount financed.
(f) The finance charge (1) as expressed as the annual percentage rate as defined in Regulation Z and (2) expressed in dollars.
(g) The number amount, and due dates or periods of payments scheduled to repay the indebtedness and the sum of those payments.
The items need not be stated in the sequence or order set forth above; additional items may be included to explain the computations made in determining the amount to be paid by the buyer. Where there is a consolidation of two or more contracts then Sections 1808.1 and 1808.2 shall apply. If the finance charge or any portion thereof is calculated on the 365-day basis, the amount of the finance charge shown pursuant to subdivision (f) shall be that amount which will be incurred by the buyer if all payments are received by the seller on their respective due dates.
(Amended (as amended by Stats. 1988, Ch. 479, Sec. 6) by Stats. 1991, Ch. 819, Sec. 9.)
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