Full text of Mimeograph Letters and Statements of the Board : Interpretation of Law or Regulation: Extension of Instalment Credit Repayable in One Payment If Partial Payment Is Made at Maturity and Balance Renewed, Number S-321, Volume 55, Page 303

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

303
S-321
Reg. W-47
INTERPRETATION OF LAW OR REGULATION
(Copies to be sent to all Federal Reserve Banks)

September 10, 194-1
TELEGRAM
Young - Boston
Sproul - ITow York
Williams - Philadelphia
Fleming - Cleveland
Leach - Richmond
McLarin -- Atlanta.

Young - Chicago
Davi:; - St. Louis
Poyton - Minneapolis
Leeiy - Kansas City
Gilbert - Dal.l.as
Doy - San Francisco

Questions have been received as to whether an extension
of credit which, upon its face, is repayable in only one scheduled
payment is an extension of instalment credit if, at its maturity,
a partial payment is made and the balance is renewed.
Answers to such questions depend upon whether or not
there are any agreements or understandings between the parties at
the time the extension of credit is made.

For example, if at the

time a particular extension of credit is made the Registrant and
obligor have an understanding that the obligor will be required
to make only a partial payment at maturity and that, upon making
such partial payment, the balance will be renewed, the extension
of credit is an extension of instalment credit notwithstanding the
fact that the obligation, upon its face, provides for repayment
in only one scheduled payment.




MORRILL