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FEDERAL RESERVE BANK
OF NEW YORK
"Circular No. 2 4 2 8 1
May 5, 1942
J

CONSUMER CREDIT
AMENDMENT NO. 4 TO REGULATION W OF THE BOARD OF
GOVERNORS OF THE FEDERAL RESERVE SYSTEM
To all Registrants under Regulation W, and
Others Concerned, in the Second Federal Reserve District:

In conformity with the President's special message to Congress of April 27, 1942, and
under authority of Executive Order No. 8843 of August 9, 1941, the Board of Governors of the
Federal Reserve System has adopted, effective May 6,1942, Amendment No. 4 of Regulation W
relating to consumer credit. A copy of the regulation in the form in effect May 6, 1942
is enclosed.
As amended, the regulation is extended to cover a comprehensive list of durable and semidurable goods for civilian consumption, and contemplates that the volume of outstanding consumer credit, already substantially diminished, will be further contracted in keeping with the
Government's purpose to prevent the rapid bidding up of prices. The purpose of this revision
is to help make effective the last point in the seven-point program which the President set forth
in his special message to Congress of April 27, 1942, as follows:
"To keep the cost of living from spiraling upward, we must discourage credit and instalment
buying, and encourage the paying off of debts, mortgages, and other obligations; for this promotes
savings, retards excessive buying and adds to the amount available to the creditors for the purchase
of war bonds."

Principal changes made by Amendment No. 4
The principal changes made in the regulation are:
1. The list of consumers' goods to which the regulation applies has been broadened to
include automobile batteries and accessories, tires and tubes; bedding; draperies; binoculars;
household electric appliances not hitherto listed; used furniture; jewelry; luggage; athletic
equipment; table and kitchenware; pottery, glassware; yard goods; and non-military clothing
and furs, including shoes, hats and other haberdashery.
2. The maximum permissible maturity of instalment sales has been reduced to twelve
months, and the required down payment for all listed articles has been increased to 33^ per
cent, except that in the case of furniture and pianos the required down payment has been
increased from ten to twenty per cent, and in the case of automobiles the maximum maturity
of fifteen months and down payment of one-third are retained.
3. The scope of the regulation has been broadened to make it cover, in addition to instalment sales and instalment loans,
(a) Charge-account sales of listed articles.—The regulation provides with respect to
charge accounts that unless payment is made by the tenth day of the second calendar month
following the purchase, no further credit may be extended to purchase any listed article
until the items in default have been paid for in full or have been placed on an instalment
basis for payment within six months. No down payments are required on purchases in
charge accounts.
(b) Single-payment consumer loans.—Such loans of $1500 or less are limited to a
maturity of ninety days, and where such a loan is to purchase a listed article costing $15.00
or mere, a down payment is also required. If not paid in ninety days, the loan must be
placed on an instalment basis.
4. The revised regulation provides that instalment payments shall not be less than $5.00
per month or $1.25 per week.
The exemption from down payment requirements of instalment sales maturing within three
months has been repealed.



Provisions covering seasonal adjustments and so-called farmer plans are retained in the
regulation, together with various additional exceptions, such as real estate loans; security
loans subject to Regulations T and U of the Board of Governors; educational, hospital, medical,
dental, and funeral expenses; aircraft; defense housing; credit to dealers; fire and casualty
insurance premiums; agricultural production loans; business loans; insurance policy loans;
and extensions of credit to the Federal Government, to local governments, or to any hospital,
school, college, or other educational or charitable institution.
Registration requirements
The regulation continues to provide that any person who is subject thereto must be licensed.
Any person who has already filed a Registration Statement is not required to file another
because he is duly licensed by virtue of the original filing.
Any person who was not formerly subject to the regulation but becomes subject thereto
because of Amendment No. 4 is granted a general license. If such person is required to be
licensed solely because he makes charge sales of listed articles or makes single-payment loans,
the general license will continue until the Board of Governors shall by public announcement
require such person to register. Any other person who now becomes subject to the regulation
must file a Registration Statement on or before July 31, 1942, the expiration date of his
general license.
How to register
Registration is accomplished by filling out Form F.R. 563-a and filing it with the Federal
Reserve Ban!; of New York provided the Registrant's main office is located in the Second
Federal Reserve District, which includes the entire State of New York, Fairfield County,
Connecticut, and the counties of Bergen, Essex, Hudson, Hunterdon, Middlesex, Monmouth,
Morris, Passaic, Somerset, Sussex, Union, and Warren, in the State of New Jersey.
Only one Registration Statement is required for any one person or corporation, which will
cover the main office and all branches, but each subsidiary, if it is a separate corporate entity
and is engaged in the business outlined above, is required to file a separate Registration
Statement.
Instructions for filling in Form F.R. 563-a are given on the back of the form, and these are
intended to enable the Registrant to fill in the form quite readily. If in completing the statement, however, any Registrant has questions which are not answered by these instructions, or
finds that following the instructions exactly would cause undue expense or inconvenience, the
Registrant should take up such questions with the Federal Reserve Bank.
Statement of borrower
The regulation provides that a person subject thereto may not make a regulated instalment loan or single-payment loan unless he obtains and accepts in good faith a signed statement of the borrower as to the purposes of the loan in form prescribed by the Board of
Governors. Since the form of statement (Form F.R. 564) heretofore prescribed, does not
provide for information concerning borrowings to repay noninstalment debt, the Board is
preparing a new form. In the meantime, however, the Board has prescribed that old Form
F.R. 564 shall be used for the present provided question 2 thereof is deleted and the word
"instalment*' is deleted from question 3. Even after the new form has been issued a Registrant who has a supply of old forms on hand may continue to use them with such deletions
until July 31,1942.
Copies of Form F.R. 563-a and additional copies of Regulation " and this circular will
W
be forwarded to you upon receipt of your request on the enclosed card.
AIXAN SPEOUL, President.
It will be appreciated if financial institutions will bring this amendment to the attention of persons who they have reason to believe may become subject to the regulation because of
the extended scope thereof and the broadening of the list of consumers* goods to which the
regulation applies.



BOARD OF GOVERNORS
of the
FEDERAL RESERVE SYSTEM

CONSUMER CREDIT

REGULATION
As Revised Effective May 6, 1942




INQUIRIES REGARDING THIS REGULATION
Any inquiry relating to this regulation should be addressed
to the Federal Reserve Bank or Federal
Reserve branch bank of the district
in which the inquiry arises.




FOREWORD
(Not a part of the regulation)
Regulation W, issued under authority of the President's Executive
Order of August 9, 1941, has been revised, effective May 6, 1942, in
compliance with that part of the President's Special Message to Congress on April 27, 1942, which reads:
"To keep the cost of living from spiraling upward
discourage credit and instalment buying, and encourage
ment of debts, mortgages, and other obligations, for this
savings, retards excessive buying and adds to the amount
to the creditors for the purchase of war bonds."

we must
the paypromotes
available

As revised, Regulation W applies to a comprehensive list of durable
and semi-durable goods for civilian consumption. The Regulation
extends to all types of consumer credit whether in the form of instalment sales and instalment loans or in the form of charge accounts and
single-payment loans.
Any inquiry relating to this Regulation should be addressed to the
Federal Reserve Bank or the Federal Reserve branch bank of the
district in which the inquiry arises.




REGULATION W
CONSUMER CREDIT
CONTENTS
SEC.
SEC.

(a)
(b)
(c)
(d)
(e)
(f)
((/)
(h)
(i)
0")
(k)
SEC.

,

General requirements
Genera! license
Registration
Suspension of license

4. INSTALMENT SALES

(a)
(b)
(c)
(d)
SEC.

Person
Extension of credit
Instalment credit
Sale
Instalment sale
Charge sale
Charge account
Instalment loan
Single-payment loan
Cash price
Registrant

5
5

3. GENERAL REQUIREMENTS AND REGISTRATION

(a)
(b)
(c)
(d)
SEC.

Page

1. SCOPE OF REGULATION
2. DEFINITIONS

Down payment
Maximum maturity
Amounts and intervals of instalments
Statement of transaction

5. CHARGE ACCOUNTS

5
5
6
6
6
6
6
6
6
6
6
7

7
7
8
8
8

8
9
9
9
9

(a)
(b)
(c)
{d)
(e)

Maximum maturity
9
Restriction
10
Default
10
Curing defaults
10
Conversion of charge account into instalment credit prior
to default
10
(/) "Floor authorizations"
11
SEC.

6. INSTALMENT LOANS

(a)
(b)
(c)
(d)
SEC.

7. SINGLE-PAYMENT LOANS

(a)
(6)
(c)
(d)
(e)
(/)
SEC.

Instalment loans to purchase listed articles
Instalment loans not to purchase listed articles
Additional requirements
Statement of the borrower
Single-payment loans to purchase listed articles
Single-payment loans not to purchase listed articles
Renewals and extensions
Statement of the borrower
Loans payable on demand
Credit to retire obligations held elsewhere

8. EXCEPTIONS

(a)
(b)
(c)
(rf)
(e)
(/)
{g)
(h)
(t)
(j)
(fc)
(I)

Real estate loans
Security loans and credits
Educational, hospital, medical, dental, and funeral expenses.
Aircraft credits
Defense housing
Credit to dealers
Fire and casualty insurance premiums
Disaster loans
Agricultural loans
Business loans
Insurance policy loans
Credit to Governmental agencies and religious, educational
or charitable institutions




11

11
11
12
12
12

12
13
13
14
14
14
14

14
14
14
15
15
15
15
15
15
16
16
16

CONTENTS
Page
SEC.

9. SEASONAL ADJUSTMENTS

(a) Intervals of payments
(b) Farmers and stock raisers
(c) Other persons with seasonal -incomes
SEC. 10. RENEWALS, REVISIONS, AND ADDITION'S OF INSTALMENT CREDIT. . .

(a)
(b)
(c)
(d)

Renewals or
revisions
Additions to outstanding credit held by Registrant
Credit to retire instalment obligations held elsewhere
Statement of necessity to prevent undue hardship

SEC. 11. EVASIVE DEVICES PROHIBITED

(a)
(b)
(c)
(d)
(e)
SEC. 12.

Evasive side agreements
Loans to make down payments
Side loan to make down payment on listed article
Purchase of article in lieu of trade-in
Coupon plans

MISCELLANEOUS PROVISIONS

(a)
(b)
(c)
(d)
(e)
(/)
(g)
(h)
(i)
(j)
(k)
(/)

Clerical errors
Extension of credit for mixed purposes
Calculating maximum maturity of instalment contract
"Lay-away" plans
Contracts and obligations outstanding on September 1, 1941.
Transactions subjected to regulation by amendment
Payments arising out of loans on pledged obligations
Records and reports
Production of records
Transactions outside United States
Right of Registrant to impose stricter requirements
Sets and groups of articles

16

16
16
17
17

17
18
18
19
19

19
19
19
20
20
20

20
20
20
20
20
21
21
21
21
21
21
21

SEC. 13. LISTED ARTICLES, DOWN PAYMENTS AND MAXIMUM CREDIT VALUES. .

22

(a) Listed articles
Group A
Group B
Group C
Group D
(b) Trade-in
(c) Down payment on automobiles and motorcycles
(d) Down payment where price is fixed by Federal authorities..
(e) Maximum amount of loan

22
22
23
23
23
23
23
24
24

SEC. 14. ENFORCE ABILITY OF CONTRACTS
SEC. 15. EFFECTIVE DATE OF REGULATION




24
24

REGULATION W
As revised effective May 6, 1942

CONSUMER CREDIT
SECTION I. SCOPE OF REGULATION

This regulation is issued by the Board of Governors of the Federal
Reserve System (hereinafter called the "Board") under authority of
section 5{b) of the Act of October 6, 1917, as amended, and Executive
Order No. 8843, dated August 9, 1941 {hereinafter called the "Executive Order").
The regulation applies, in general, to any person who is engaged in
the business of making extensions of instalment credit, extending credit
in charge accounts, making single-payment loans in amounts of $1,500
or less, or discounting or purchasing obligations arising out of such
extensions of credit. It applies whether the person so engaged is acting
as principal, agent, broker or otherwise, and whether the person is a
bank, loan company, or finance company, or a person who is so engaged in connection with any other business, such as by making such
extensions of credit as a dealer, retailer, or other person in connection
with the selling of consumers' durable or semi-durable goods.1
SECTION 2. DEFINITIONS

For the purposes of this regulation, unless the context otherwise
requires:
(a) "Person" means an individual, partnership, association, or corporation.
(b) "Extension of Credit" means any loan or mortgage; any instalment purchase contract, any conditional sales contract, or any sale or
contract of sale under which part or all of the price is payable subsequent to the making of such sale or contract; any rental-purchase
contract, or any contract for the bailment or leasing of property under
which the bailee or lessee either has the option of becoming the owner
thereof or obligates himself to pay as compensation a sum substantially
equal to or in excess of the value thereof; any contract creating any
lien or similar claim on property to be discharged by the payment of
money or its equivalent; any purchase, discount, or other acquisition
of, or any extension of credit upon the security of, any obligation aris1
The Executive Order defines "consumers' durable Rood" as includlne "any (tood. whether
new or used, which is durable or semi-durahle and is used or usable for personal, family or
household purposes, and anv service connected wilh the acquisition of any such (tood or of any
interest therein." Section 13(a) lists the consumers' durable and semi-durable goods within the
scope of the regulation.




b

REGULATION W

ing out of any of the foregoing; and any transaction or series of transactions having a similar purpose or effect.
(c) "Instalment Credit" means an extension of credit which the
obligor undertakes to repay in two or more scheduled payments or as
to which the obligor undertakes to make two or more scheduled payments or deposits usable to liquidate the credit, or which has a similar
purpose or effect.
(d) "Sale" means a transfer of property for a price in money or its
equivalent which the buyer pays or promises to pay to the seller
for the thing bought or sold. It includes a lease, bailment, or other
transaction which is similar in purpose or effect to a sale.
(e) "Instalment Sale" means an instalment credit which is made,
as principal, agent or broker, by any seller of any consumers' durable
or semi-durable good listed in section 13(a) (hereinafter called a
"listed article") and which arises out of a sale of such listed article.
(/) "Charge Sale"' means an extension of credit (other than instalment credit) which is made, as principal, agent or broker, by any
seller and which arises out of a sale of any article, whether listed or
unlisted.
(g) "Charge Account" means the indebtedness arising from charge
sales between the same seller and purchaser.
(h) "Instalment Loan" means an instalment credit, other than an
instalment sale, in the form of a loan which is in a principal amount
of $1,500 or less; but the definition does not include any loan upon the
security of any obligation which arises out of any instalment sale or
instalment loan.
(i) "Single-payment Loan" means an extension of credit in the form
of a loan to one or more individuals (other than a partnership), which
is repayable in a single payment whether on demand or on a fixed or
determinable future date, and which is in a principal amount of $1,500
or less; but the definition does not include (I) a loan made for business
purposes to a business enterprise which is not for the purpose of purchasing a listed article, (2) a loan for agricultural purposes to a person engaged in agriculture which is not for the purpose of purchasing
a listed article or (3) any loan upon the security of any obligation
which arises out of any instalment sale, instalment loan, charge account
or single-payment loan.
(;') "Cash Price" means the bona fide cash purchase price of an
article, including the bona fide cash purchase price of any accessories,
any bona fide delivery, installation and service charges (other than
interest, finance or insurance charges), and any applicable sales taxes.
(k) "Registrant" means a person who is licensed pursuant to section 3.



REGULATION W

7

SECTION 3. GENERAL REQUIREMENTS AND REGISTRATION

(a) General Requirements.—No person engaged in the business of
making instalment sales,2 charge sales of listed articles, instalment
loans, or single-payment loans, or engaged in the business of lending
on the security of or discounting or purchasing obligations arising out
of such extensions of credit, shall make or receive any payment which
constitutes or arises directly or indirectly out of any such extension
of credit made by him or out of any such obligation lent on or discounted or purchased by him, except on the following conditions:
(1) He must be licensed pursuant to this section;
(2) He must not make or receive any such payment in connection with an extension of credit made by him if he knew or had
reason to know when he made such extension of credit any fact by
reason of which it failed to comply with any requirement of this
regulation applicable thereto;
(3) He must not make or receive any such payment in connection with any obligation which he has purchased or discounted
or has accepted as collateral if, at the time he purchased or discounted such obligation or accepted it as collateral, it showed on
its face a failure to comply with such requirements or if he knew
any fact by reason of which the extension of credit giving rise to
the obligation failed to comply with such requirements; and
(4) He must not make or receive any such payment in connection with an obligation arising out of an extension of credit which
he has renewed, revised or consolidated, if he knew or had reason
to know when he renewed, revised or consolidated it any fact
by reason of which such renewal, revision or consolidation resulted in a failure to comply with such requirements.
(b) General License.—-Whenever this regulation is amended so
that any person who was not formerly subject to section 3 (a) becomes
subject thereto, such person is hereby granted a general license; but
such general license shall terminate at the end of the second full calendar month after the month in which the amendment becomes effective unless such person has registered in the manner provided in section
3(c) before such termination, except that the general license of a person who is required to be licensed solely because he makes charge
sales of listed articles or makes single-payment loans shall not terminate until the expiration of the time within which the Board shall, by
public announcement, require such person to register.
Any person whose license is not suspended may become licensed by
registering in the manner provided in section 3(c).
1
It is to be noted that the terra "instalment sale" includes only instalment credit arising out of
the sale of listed articles.




O

REGULATION W

(c) Registration.—Registration may be accomplished by filing, with
the Federal Reserve Bank or any branch thereof in the district in
which the main office of the Registrant is located, a registration statement on forms obtainable from any Federal Reserve Bank or branch.
(d) Suspension of License.3—The license of any Registrant may,
after reasonable notice and opportunity for hearing, be suspended by
the Board, in its entirety or as to particular activities or particular
offices or for specified periods, on any of the following grounds:
(1) Any material misstatement or omission willfully or negligently made in the registration statement;
(2) Any willful or negligent failure to comply with any provision of this regulation or any requirement of the Board pursuant
thereto.
A license which is suspended for a specified period will again become
effective upon the expiration of such period. A license which is suspended indefinitely may be restored by the Board, in its discretion,
if the Board is satisfied that its restoration would not lead to further
violations of this regulation and would not be otherwise incompatible
with the public interest.
SECTION 4. INSTALMENT SALES

Except as otherwise permitted by this regulation, each instalment
sale shall comply with the following requirements:
(a) Down Payment.—The down payment shall not be less than
one-third of the cash price of the listed article, except that:
(1) In the case of pianos and furniture as defined in Group B
of section 13(a), the down payment need not be more than onefifth of the cash price;
(2) In the case of articles listed in Group C of section 13(a),
no down payment is required; and
(3) In the case of articles the cash price of which is $6.00 or
less, no down payment is required.
In any case involving a used automobile, any article for which the
Federal price authorities have prescribed a maximum retail price,
or any article on which there is a trade-in by the purchaser, the amount
of the down payment must be computed in accordance with the applicable provisions of section 13.
"In addition, any Reaistrant who willfuHv violates or knowinelv participates in a violation of
this reputation is subject to the penalties prescribed in section 5(b) of the Act of October 6, 1917.
as amended, which reads in part as follows: "Whoever willfully violates any of the provisions of
this subdivision or of any license, order, rule or regulation issued thereunder, shall, upon conviction.
be fined not more than $10,000. or. if a natural person, may be imprisoned for not more than ten
years, or both; and any officer, director, or agent of any corporation who knowingly participates
in such violation may be punished by a like fine, imprisonment, or both."




REGULATION W

9

(6) Maximum Maturity.—The maturity shall not exceed 12 months,
except that, in the case of automobiles and motorcycles as defined in
Group D of section 13(a), the maturity may be not more than 15
months.
(c) Amounts and Intervals of Instalments.—Except as permitted
by section 9, the instalments in which the time balance is payable
(1) shall not be less than $5.00 per month or $1.25 per week on the
aggregate instalment indebtedness of one debtor to the same creditor;
(2) shall be substantially equal in amount or so arranged that no instalment is substantially greater in amount than any preceding instalment; and (3) shall be payable at approximately equal intervals not
exceeding one month.
(d) Statement of Transaction.—Unless the cash price of the article
sold is $6.00 or less, the instalment sale shall be evidenced by a written
instrument or record, and there shall be incorporated therein or attached thereto a written statement, of which a copy shall be given to
the obligor as promptly as circumstances will permit, and which shall
set forth (in any order) the following information:
(1) A brief description identifying the article purchased;
(2) The cash price of the article;
(3) The amount of the purchaser's down payment (i) in cash
and (ii) in goods accepted in trade, together with a brief description identifying such goods and stating the monetary value assigned thereto in good faith;
(4) The deferred balance, which is the difference between items
(2) and (3);
(5) The amount of any insurance premium for which credit is
extended and of any finance charges or interest by way of discount included in the principal amount of the obligation, or the
sum of these amounts;
(6) The time balance owed by the purchaser, which is the sum
total of items (4) and (5); and
(7) The terms of payment.
SECTION 5. CHARGE ACCOUNTS

Except as otherwise permitted by this regulation, each charge sale
and charge account shall comply with the following requirements:
(a) Maximum Maturity.—Except as permitted by section 9, no
listed article shall be sold in a charge account with an agreement that
payment therefor may be deferred beyond the 10th day of the second
calendar month following the calendar month during which such article
was sold.



10

REGULATION W

(b) Restriction.—When a charge account is in default, the Registrant shall not extend credit to the obligor for any charge sale or
instalment sale of any listed article until the default has been cured
by one of the methods described below.
(c) Default.—A charge account shall be deemed to be in default
if any article (whether listed or unlisted) for which credit was extended
in such account has not been paid for in full on or before the 10th day
of the second calendar month following the calendar month during
which such article was sold, except that:
(1) A charge account shall not be deemed to be in default because of a failure to make payment for any article purchased
therein prior to May 1, 1942, unless such article shall not have
been paid for in full by July 10, 1942;
(2) If an article was sold in a charge account prior to May 1,
1942, under a definite agreement between the seller and purchaser
(evidenced in writing) that such article need not be paid for until
a specified date, the account shall not be deemed to be in default
with respect to such article unless such article shall not have been
paid for in full by the date so agreed upon; and
(3) For persons with seasonal incomes, adjustments are permitted in accordance with section 9.
fd) Curing Defaults.—When a charge account is in default, the
default may be cured either;
(1) By payment in full of the amount in default;
(2) By the purchaser entering into a written agreement in good
faith to pay the amount in default within a period of 6 months
or less from the date of such agreement by substantially equal
instalment payments of not less than $5.00 per month or S1.25
per week at substantially equal intervals not exceeding one
month 4 ; or
(3) By the purchaser filing with the creditor a Statement of
Necessity in accordance with section 10 (d) and entering into a
written agreement in good faith to pay the amount in default
within a period of 12 months from the date of such agreement by
substantially equal instalment payments at substantially equal
intervals not exceeding one month.4
(e) Conversion of Charge Account into Instalment Credit Prior
to Default.—If the seller and purchaser agree to convert into an instalment credit4 the whole or any part of a charge account arising from the
* Renewals, revisions, and additions of instalment credits growing out of charge accounts are
subject to the provisions of section 10.




REGULATION W

11

sale of a listed.article the charge for which is not in default, the agreement shall be in writing and shall provide that the instalment credit shall
be retired within 6 months from the date of the agreement by substantially equal payments of not less than $5.00 per month or $1.25 per
week, at substantially equal intervals not exceeding one month.
(/) "Floor Authorizations".—A Registrant shall not be deemed to
have violated section 5(b) if he makes a charge sale of a listed article,
the cash price of which is $5.00 or less, for immediate delivery to the
customer in person and (1) the person authorizing such charge sale on
behalf of the Registrant acts in good faith without knowledge that the
customer's charge account is in default, and (2) the Registrant, upon
discovery that such charge account is in default, promptly requests
the return of, or the immediate payment in full for, the article sold.
SECTION 6. INSTALMENT LOANS

Except as otherwise permitted by this regulation, each
loan shall comply with the following requirements:
(a) Instalment Loans to Purchase Listed Articles.—If
trant knows or has reason to know that the proceeds of an
loan (defined to exclude loans of more than $1,500) are to
purchase any listed article having a cash price of $15.00 or

instalment
the Regisinstalment
be used to
more:

(1) The principal amount lent (excluding any interest or finance
charges and the cost of any insurance) shall not exceed twothirds of the cash price of the listed article except that:
(i) This requirement does not apply in the case of articles
listed in Group C of section 13 (a); and
(ii) The principal amount lent may be not more than fourfifths of the cash price of a piano or furniture as defined in
Group B of section 13(a).
In any case involving a used automobile, or any article on which
there is a trade-in by the purchaser, the maximum amount which
may be lent shall be computed in accordance with the applicable
provisions of section 13; and
(2) The maturity shall not exceed 12 months, except that, in
the case of automobiles and motorcycles as defined in Group D
of section 13(a), the maturity may be not more than 15 months.
(b) Instalment Loans Not to Purchase Listed Articles.—In the case
of an instalment loan (defined to exclude loans of more than $1,500)
which is not subject to section 6(a), the maximum maturity shall not
exceed 12 months; except that, if the Registrant knows or has reason to
know that the proceeds are to be used to reduce or retire a charge



12

REGULATION W

account arising in whole or in part from the sale of a listed article, or
to reduce or retire a single-payment loan which is subject to this regulation, the maximum maturity shall not exceed 6 months.
(c) Additional Requirements.—Whether subject to section 6(a)
or section 6(b), the instalment loan shall comply with the following
additional requirements:
(1) It shall be evidenced by a written instrument or record,
and there shall be incorporated therein or attached thereto a written statement, of which a copy shall be given to the obligor as
promptly as circumstances will permit, and which shall set forth
the terms of payment;
(2) Except as permitted by section 9, the obligation shall be
payable in instalments which (i) shall not be less than $5.00 per
month or $1.25 per week, on the aggregate instalment indebtedness
of the debtor to the creditor, (ii) shall be substantially equal in
amount or be so arranged that no instalment is substantially
greater in amount than any preceding instalment, and (iii) shall
be payable at approximately equal intervals not exceeding one
month.
(d) Statement of the Borrower.—No Registrant shall make any
instalment loan, except under the provisions of section 10(a), unless
he shall have accepted in good faith a signed Statement of the Borrower as to the purposes of the loan in form prescribed by the Board.
No obligor shall willfully make any material misstatement or omission in such a Statement. If the Registrant relies in good faith on
the facts set out by the obligor in such Statement, it shall be deemed
to be correct for the purposes of the Registrant.
SECTION 7. SINGLE-PAYMENT LOANS

Except as otherwise permitted by this regulation, each single-payment loan shall comply with the following requirements:
(a) Single-payment Loans to Purchase Listed Articles.—If the
Registrant knows or has reason to know that the proceeds of a singlepayment loan (defined to exclude loans of more than $1,500) are to
be used to purchase any listed article having a cash price of $15.00
or more:
(1) The principal amount lent (excluding any interest or
finance charges and the cost of any insurance) shall not exceed
two-thirds of the cash price of the listed article, except that:
(i) This requirement does not apply in the case of articles
listed in Group C of section 13(a); and



REGULATION W

13

(ii) The principal amount lent may be not more than fourfifths of the cash price of a piano or furniture as defined in
Group B of section 13(a).
In any case involving a used automobile or any article on which
there is a trade-in by the purchaser, the maximum amount which
may be lent shall be computed in accordance with the applicable
provisions of section 13; and
(2) The maturity shall not exceed 90 days, except as permitted
by section 9.
(b) Single-payment Loans Not to Purchase Listed Articles.—In
the case of a single-payment loan (defined to exclude loans of more
than $1,500) not subject to section 7(a), the maximum maturity shall
not exceed 90 days, except as permitted by section 9.
(c) Renewals and Extensions.—A single-payment loan (denned to
exclude loans of more than $1,500) made originally on or after May 6,
1942, may not be renewed or extended except as follows:
(1) A single-payment loan made on or after May 6, 1942 may
be renewed or extended by means of an instalment loan complying
with the requirements of sections 6(b) and 6(c)(2) with the
maturity"' calculated from the date on which the original singlepayment loan was made;
(2) A single-payment loan made on or after May 6, 1942 may
be renewed or extended by a series of obligations each of which
has a maturity of not in excess of 90 days if the last of such
obligations matures not later than the date on which an instalment loan made for a similar purpose would have matured 5 and
the borrower pays at the time of each such renewal or extension
enough to reduce the unpaid balance to an amount not greater
than would have been permitted if the loan had been an instalment loan subject to the provisions of section 6(b); and
(3) Nothing in this regulation shall be construed to prevent
the Registrant from making any renewal or revision or taking any
action that he shall deem necessary in good faith (i) with respect to any obligation of any member of the armed forces of the
United States incurred prior to his induction into such service, or
(ii) for the Registrant's own protection in connection with any
obligation which is in default and is the subject of bona fide
collection effort by the Registrant.
5
The maturity must not be later than twelve months from the date on which the original loan
waa made, except that (1) if the Registrant know or have reason to know that the proceeds were
used to reduce or retire a charge account, the maturity must not he later than six months from
such date, and (2) if the borrower file, and the Registrant accept in good faith, a Statement of
Necessity in accordance with the requirements of section 10(d), the maturity may be not more
th*n twelve months from the date of such renewal or extension.




14

REGULATION W

(d) Statement of the Borrower.6—No Registrant shall make any
single-payment loan, except under the provisions of section 7 (c), unless
he shall have accepted in good faith a signed Statement of the Borrower
as to the purpose of the loan in form prescribed by the Board. No
obligor shall willfully make any material misstatement or omission in
such Statement. If a Registrant relies in good faith on the facts set
out by the obligor in such Statement, it shall be deemed to be correct for the purposes of the Registrant.
(e) Loans Payable on Demand.—-A single-payment loan made on
or after May 6, 1942, which is payable on demand shall be treated for
the purposes of this regulation as if it matured 90 days after the date
on which it was made.
(/) Credit to Retire Obligations Held Elsewhere.—Any singlepayment loan, the proceeds of which a Registrant knows or has reason
to know will be used in whole or in part to retire any single-payment
loan not held by such Registrant, shall be subject to the provisions
of this regulation to the same extent as if the obligation being retired
were held by the Registrant.
SECTION 8. EXCEPTIONS

This regulation shall not apply to any of the following:
(a) Real Estate Loans.—Any extension of credit which is secured
by a bona fide first lien on improved real estate duly recorded or
which is for the purpose of financing or refinancing the construction or
purchase of an entire residential building or other entire structure.
(b) Security Loans and Credits.—Any extension of credit on securities which is subject to the Board's Regulation T (relating to Extension and Maintenance of Credit by Brokers, Dealers, and Members of
National Securities Exchanges), or subject to the Board's Regulation
U (relating to Loans by Banks for the Purpose of Purchasing or Carrying Stocks Registered on a National Securities Exchange), or any other
extension of credit for the purpose of purchasing or carrying stocks,
bonds or other investment securities.
(c) Educational, Hospital, Medical, Dental, and Funeral Expenses.
—Any instalment loan as to which the Registrant accepts in good faith
a written statement signed by the borrower certifying:
(1) That the proceeds are to be used for bona fide educational,
medical, hospital, dental, or funeral expenses, or to pay debts incurred for such expenses;
8
This requirement does not apply to a single-payment loan made for business purposes to a
business enterprise or for agricultural purposes to a person engaged in agriculture, unless the
proceeds are to be used to purchase a listed article.




EEGTJLATION W

15

(2) That his income available for the purpose is such that he
could not reasonably meet the requirements of this regulation
otherwise applicable; and
(3) That failure to obtain the extension of credit would cause
undue hardship to him or his dependents.
Such a statement by the borrower must set forth specifically the facts
relied upon to bring the loan within this exception; and the facts
recited therein shall be deemed to be correct for the purposes of this
regulation if the statement is accepted by the Registrant in good faith.
(d) Aircraft Credits.—Any extension of credit to finance the purchase of aircraft for use in any activity in respect of which a preference
rating of A-10 or higher is in force for deliveries of civil aircraft.
(e) Defense Housing.—Any extension of credit to remodel or
rehabilitate any structure which the Administrator of the National
Housing Agency, or his authorized agent, shall designate as being for
"defense housing" as defined by the Administrator. Information regarding the procedure for obtaining such a designation may be obtained through any Federal Reserve Bank or branch.
(/) Credit to Dealers.—Any extension of credit to a dealer in any
listed article (including a wholesaler, retailer, and a plumbing, electrical, heating or other contractor) to finance the purchase of any
such article for resale or installation.
(<?) Fire and Casualty Insurance Premiums.—Any loan which is
made for the purpose of financing a premium in excess of one year on
a fire or casualty insurance policy, if the proceeds are paid directly
to the insurance agent, broker, or company issuing or underwriting the
insurance and the extension of credit is fully secured by the unearned
portion of the premium so financed.
(h) Disaster Loans.—Any loan made by the Disaster Loan Corporation.
(i) Agricultural Loans.—Any loan to a person engaged in agriculture, or to a cooperative association of such persons, if it (1) is
made by the Land Bank Commissioner on behalf of the Federal Farm
Mortgage Corporation and is found, pursuant to regulations issued by
the Commissioner, to be necessary to maintain or increase production
of essential agricultural commodities, or (2) is approved by the Farm
Security Administrator or his authorized agent as being necessary for
the rehabilitation of a needy farm family, or (3) is for general agricultural purposes and is not for the purpose of purchasing any listed
article. In determining whether an extension of credit meets the description of clause (3) above, a Registrant may accept in good faith
a written statement signed by the obligor setting forth the facts relied
upon to bring it within the description, and the facts set forth in such



16

REGULATION W

statement shall be deemed to be correct for the purposes of this
regulation.
{;) Business Loans.—Any loan for business purposes to a business enterprise which is not for the purpose of purchasing a listed
article.
(k) Insurance Policy Loans.—Any loan made by a life insurance
company which is fully secured by the loan value or cash surrender
value of a life insurance policy issued by such company; any loan made
by any Registrant on the security of the loan value or cash surrender
value of a life insurance policy for the purpose of enabling the borrower
to pay off a policy loan made by the insurer prior to May 6, 1942; and
any renewal or extension of any such loan which does not involve an
increase in the amount of the loan.
(I) Credit to Governmental Agencies and Religious, Educational
or Charitable Institutions.—Any extension of credit to the Federal
Government, any State government, any political subdivision, or any
department, agency or establishment thereof, or to any church, hospital,
clinic, sanitarium, school, college, or other religious, educational,
charitable, or eleemosynary institution.
SECTION 9. SEASONAL ADJUSTMENTS

Notwithstanding any other provision of this regulation, appropriate
seasonal adjustments may be made in connection with the contractual
time of payment of any extension of credit, in accordance with the
following provisions:
(a) Intervals of Payments.—When appropriate for the purpose of
facilitating payment in accordance with the obligor's main source of
income, the payment schedule in connection with any instalment credit
may reduce or omit payments over any period or periods totaling not
more than 4 months, if the other payments are increased in such manner as to meet all the other requirements of this regulation applicable
to such instalment credit.
(6) Farmers and Stock Raisers.—-When appropriate for the purpose
of facilitating payment in accordance with the seasonal nature of the
obligor's main source of income, any instalment credit which is made
to a person who is engaged in agriculture or stock raising and derives
his income principally therefrom may be payable in any amounts and
at any intervals, if: (1) The instalment credit complies with the
applicable provisions of this regulation concerning the amount and
maximum maturity of the credit, and (2) at least one-half of the
credit is to be repaid within the first half of the applicable maximum
maturity.



REGULATION" W

17

If the purchaser or borrower be known to the Registrant customarily
to receive 75 per cent or more of his income during one or two seasons
of the year from farming or stock raising, (1) his charge account shall
not be deemed to be in default unless the articles previously purchased
in the account shall not have been paid for in full within 10 days after
the end of the next calendar month during which most of his annual
or semi-anntial income is customarily received, (2) any single-payment
loan made to him may be made to mature during the next calendar
month in which most of his annual or semi-annual income is customarily
received, and (3) the schedule of payments in connection with any
instalment credit extended to him may be arranged so that the instalment payments will fall due during the calendar months in which
most of his annual or semi-annual income is customarily received; but
each such extension of -credit shall mature not later than 12 months
from the date on which it was originally extended.
(c) Other Persons with Seasonal Incomes.—If the Registrant has
accepted from the purchaser or borrower in good faith a written statement to the effect that such purchaser or borrower customarily receives
75 per cent or more of his income during one or two specified seasons
of the year from seasonal labor, investments, trust funds, or other
seasonal sources, (1) his charge account shall not be deemed to be
in default unless the articles previously purchased in the account
shall not have been paid for in full within 10 days after the end of
the next calendar month during which most of his annual or semiannual income is customarily received, (2) any single-payment loan
made to him may be made to mature during the next calendar month
in which most of his annual or semi-annual income is customarily
received, and (3) the schedule of payments in connection with any
instalment credit extended to him may be arranged so that the instalment payments will fall due during the calendar months in which most
of his annual or semi-annual income is customarily received; but each
such extension of credit shall mature not later than 12 months from
the date on which it was originally extended.
SECTION 10. RENEWALS, REVISIONS, AND ADDITIONS OF INSTALMENT CREDIT

fa) Renewals or Revisions.—If any obligation evidencing any
instalment sale or instalment loan is renewed or revised by a Registrant, such renewal or revision must not have the effect of changing
the terms of repayment to terms which this regulation would not
have permitted in the first instance for such credit 7 ; but nothing in
7
If there should be any arrearage under an instalment contract which does not arise out of
anv prearrangement or plan to evade this regulation, the arrearage may be divided equally among
and added to the remaining payments scheduled for the liquidation of the credit to which such
arrearage relates. This applies to any renewal, revision or consolidation effected in accordance
with any provision of section 10.




18

REGULATION W

this regulation shall be construed to prevent any Registrant from
making any renewal or revision, or taking any action that lie shall
deem necessary in good faith, (1) with respect to any obligation of
any member of the armed forces of the United States incurred prior
to his induction into such service, or (2) for the Registrant's own
protection in connection with any obligation which is in default and
is the subject of bona fide collection effort by the Registrant.
(6) Additions to Outstanding Credit Held by Registrant—An obligation evidencing any instalment sale s or instalment loan shall not
be consolidated with any obligation or obligations held by the Registrant evidencing any prior instalment sale or instalment loan to the
same obligor, unless the additional credit complies with the down
payment or maximum credit limitations applicable thereto (if any)
and. in addition, the consolidated obligation complies with one of the
following options:
Option 1. The terms of the consolidated obligation shall be
such as would have been necessary to meet the requirements of
this regulation if the several obligations had not been consolidated, except that, in order to schedule payments at approximately
equal intervals, the consolidated obligation may combine payments that would otherwise have fallen due at different times
within any monthly period, but the first of such combined payments shall fall due within one month after such consolidation;
or
Option 2. The consolidated obligation shall provide for a rate of
payment (not less than $5.00 per month or SI.25 p?r week)
throughout its term, which is (i) at least as large per month as
the rate of payment or payments on the outstanding obligation
or obligations being consolidated would have been for the month
commencing on the date of consolidation,9 and (ii) is larger to
whatever extent may be necessary in order to repay the consolidated obligation within 12 months.
(c) Credit to Retire Instalment Obligations Held Elsewhere.—Any
instalment loan, the proceeds of which a Registrant knows or has
reason to know will be used in whole or in part to retire any instalment sale 10 or instalment loan not held by such Registrant, shall be
subject to the provisions of this regulation to the same extent as if the
obligation being retired were held by the Registrant.
8
The term ''instalment sale" as here used inc]ud»3 an instalment credit resulting frcm the conversion of a charee account to an instalment basis.
• If any part of the consolidated obligation is used to reduce or retire a charite account or singlepaynient loan, under the provisions of section 6(b) or 7 (c) (1), such part shall be treated for the
purpose of this Option as if the charge account or single-payment loan were payable in six
eniint monthlv instalments.
10
The term "instalment sale" as here used includes an instalment credit resulting from the conversion of a charge account to an instalment basis.




BEGXJLATION W

19

(d) Statement of Necessity to Prevent Undue Hardship.—Notwithstanding any other provision of this regulation, if a Registrant
accepts in good faith a Statement of Necessity as provided in the
following paragraph, the renewed, revised or consolidated obligation
may provide for a schedule of repayment as though it were a new
instalment loan subject to section 6(b), except that the payments
need not be as large as 15.00 per month or $1.25 per week, even
though such action results in the reduction of the rate of repayment
thereon.
The requirements of a Statement of Necessity will be complied with
only if the Registrant accepts in good faith a written statement signed
by the obligor, in form and content prescribed by the Board, that the
contemplated renewal, revision or other action is necessary in order
to avoid undue hardship upon the obligor or his dependents resulting
from contingencies that were unforeseen by him at the time of obtaining the original extension of credit or which were beyond his control,
which statement also sets forth briefly the principal facts and circumstances with respect to such contingencies and specifically states
that the renewal, revision, or other action is not pursuant to a preconceived plan or an intention to evade or circumvent the requirements
of this regulation.
SECTION 11. EVASIVE DEVICES PROHIBITED

(a) Evasive Side Agreements.—No extension of credit complies
with the requirements of this regulation if at the time it is made there
is any agreement, arrangement, or understanding by which the obligor
is to be enabled to make repayment on conditions inconsistent with
those required by this regulation, or which would otherwise evade or
circumvent, or conceal any evasion or circumvention of, any requirement of this regulation.
(b) Loans to Make Down Payments.—A Registrant shall not make
any instalment loan or single-payment loan if he knows or has reason
to know that any part of the proceeds thereof is to be used to make a
down payment on the purchase price of any listed article.
(c) Side Loan to Make Down Payment on Listed Article.—A Registrant shall not make an extension of credit to finance the purchase
of any listed article if he knows or has reason to know that there is, or
that there is to be, any other extension of credit in connection with
the purchase of the listed article which would bring the total amount
of credit extended in connection with such purchase beyond the
amount permitted by this regulation; but, if the Registrant accepts
in good faith a written statement signed by the obligor that no such



20

REGULATION W

other extension exists or is to be made, such statement shall be deemed
to be correct for the purposes of this regulation.
(d) Purchase of Article in Lieu of Trade-in.—Anything which the
seller of a listed article buys, or arranges to have bought, from the
purchaser at or about the time of the purchase of the listed article
shall be regarded as a trade-in for purposes of this regulation.
(e) Coupon Plans.—No coupon, ticket or similar medium of
credit, whether paid for in instalments or otherwise, shall be accepted
by any Registrant in payment, in whole or in part, for any listed
article if such acceptance, in effect, would permit the article to be
sold on terms not complying with the requirements of this regulation.
SECTION 12. MISCELLANEOUS PROVISIONS

(a) Clerical Errors.—Any failure to comply with this regulation
resulting from a mistake in determining, calculating, or recording
any price, down payment, or extension of credit, or other similar
matter, shall not be construed to be a violation of this regulation
if the Registrant establishes that such failure to comply was the result
of excusable error and was not occasioned by a regular course of
dealing.
(6) Extension of Credit for Mixed Purposes.—In case an extension
of credit arises partly out of a sale of a listed article and partly out
of another sale, or is partly subject to one section of this regulation
and partly subject to another section, or is partly subject to the regulation and partly not subject to the regulation, the amount and terms
of such extension of credit shall be such as would result if the credit
were divided into two or more parts and eacli part were treated in
good faith as if it stood alone.
(c) Calculating Maximum Maturity of Instalment Contract.—In
calculating the maximum maturity of an instalment sale or instalment
loan, a Registrant may, at his option, use any date not more than 15
days subsequent to the actual date of the sale or loan.
(rf) "Lay-away" Plans.—With respect to any extension of credit
involving a bona fide "lay-away" plan, or other similar plan by which
a purchaser makes one or more payments on an article before receiving delivery thereof, the Registrant may, for the purposes of this regulation, treat the extension of credit as not having been made until the
date of the delivery of the article to the purchaser.
(e) Contracts and Obligations Outstanding on September 1, 1941.—
Nothing in this regulation shall prevent the performance of any valid
contract or obligation entered into prior to September 1, 1941; but,
when any obligation arising out of any extension of credit made prior
to September 1, 1941, has been combined with any extension of credit



REGULATION W

21

made on or after September 1, 1941, or has been the subject of any
renewal or revision made on or after such date, such extension of
credit shall thereafter be treated for the purposes of this regulation
as having been made on the date of such consolidation, renewal or
revision.
(/) Transactions Subjected to Regulation by Amendment.—Whenever this regulation is amended to add any article to the list of articles specified in section 13 (a) or so as to apply to any additional class
of transactions, the amendment shall not prevent the performance of any valid contract made prior to the effective date of
the amendment; but any renewal, revision or consolidation of any
obligation growing out of an extension of credit covering such newly
added article or class of transactions shall be subject to the applicable
requirements of this regulation, and, for the purposes of the applicable
provisions regarding renewals, revisions and consolidations, the terms
of repayment "permitted in the first instance" for such an obligation
shall be deemed to be those applicable to such an extension of credit
under such amendment.
(g) Payments Arising out of Loans on Pledged Obligations.—
With respect to any loan on the security of an obligation which arises
out of an extension of credit subject to this regulation, the prohibitions
of this regulation shall be deemed to apply only to payments arising
out of the obligation rather than to payments arising out of the loan.
(h) Records and Reports.—Every Registrant shall keep such
records and make such reports as the Board may from time to time
require as necessary or appropriate for enabling it to perform its functions under the Executive Order.
(i) Production of Records.—Every Registrant, as and when required by the Board, shall furnish complete information relative to
any transaction within the scope of the Executive Order, including
the production of any books of account, contracts, letters, or other
papers in connection therewith.
(j) Transactions Outside United States.—Nothing in this regulation shall apply with respect to any extension of credit made in Alaska,
the Panama Canal Zone, or any territory or possession outside the
continental United States.
(k) Right of Registrant to Impose Stricter Requirements.—Any
Registrant has the right to refuse to extend credit, or to extend less
credit than the amount permitted by this regulation, or to require that
repayment be made within a shorter period than the maximum permitted by this regulation.
(I) Sets and Groups of Articles.—For the purposes of this regulation, the word "article" shall be deemed to include any set, group or



22

HEGTJLATION W

assembly commonly considered, sold or used as a single unit, if the
component parts thereof are sold or delivered at substantially the
same time.
SECTION 13. LISTED ARTICLES, DOWN PAYMENTS AND MAXIMUM CREDIT
VALUES

(a) Listed Articles.—The following are the articles which are "listed
articles" within the meaning of this regulation:
Group A—One-third down and 12 months' maximum maturity:
1. Air conditioners, room unit.
2. Air conditioning systems, home.
3. Aircraft (including gliders).
4. Attic ventilating fans.
* 5. Automobile batteries and accessories.
* 6. Automobile tires and inner tubes, for passenger automobiles.
" 7. Bedding, blankets, curtains, draperies, and household linens and towels.
b
8. Bicycles.
* 9. Binoculars, field glasses, opera glasses, and hand telescopes.
c
10. Boats, and inboard and outboard motors designed for use therewith, other
than boats or motors designed specifically for commercial use.
b
11. Clocks, electric or other, designed for household or personal use.
12. Cooking stoves and ranges, designed for household use.
13. Dishwashers, electric, designed for household use.
" 14. Electric appliances, not elsewhere listed, designed for household or personal
use.
b
15. Floor coverings (including fabric and linoleum type rugs, carpets, mats, and
other floor covering materials, whether or not designed to be affixed to
the floor).
16. Furnaces and heating units for furnaces, household (including oil burners,
gas conversion burners, and stokers).
17. Heating stoves and space heaters, designed for household use.
18. Ironers designed for household use.
" 19. Jewelry (including precious stones and costume jewelry).
d
20. Lamps designed for household use.
'21. Lawn mowers, edgers. and trimmers (whether or not power-driven).
"22. Lighting fixtures designed for household use.
° 23. Luggage, purses, handbags, toilet cases, and umbrellas.
b
24. Motion picture cameras, projectors, and lenses, designed for film gauges less
than 35 mm.; still cameras, projectors, lenses and shutters, and enlargers.
e
25. Musical instruments not elsewhere listed.
26. Organs, household electric.
27. Plumbing and sanitary fixtures designed for household use.
D
28. Portable lights, and portable or stationary flood-lighting equipment, designed for household use.
29. Radio receiving sets, phonographs, or combinations.
30. Refrigerators, mechanical, of less than 12 cubic feet rated capacity.
31. Sewing machines designed for household use.
b
32. Silverware (including flatware and hollow ware, whether solid or plated).
* 33. Sports', athletic, outing, and games' equipment.
* 34. Suction cleaners and mechanical carpet sweepers, designed for household
use.
* 35. Tableware and kitchen ware, equipment, and utensils, designed for household use (including pottery, porcelain, chinaware, glassware, and cutlery).
36. Washing machines designed for household use.
• Added effective May 6, 1942.
» Added effective March 23, 1942.
Boats other than power driven hosts added effective May 6, 1942.
Lamps previously classified as furniture.
* Lawn mowers, mower-type edgers and trimmers added effective March 23, 1942. Edgers and
trimmers other than mower-type, musical instruments other than those composed principally of
metal, and mechanical carpet sweepers added effective May 8, 1942.
c
d




REGULATION W

23

"37.
38.
39.
• 40.

Watches.
Water heaters designed for household use.
Water pumps designed for household use.
Wearing apparel and furs, non-military, (including footwear, headwear, and
haberdashery).
*41. Yard goods designed for making garments or for making articles of household use.
Group B—SO per cent down and 12 months' maximum maturity:
' 1. Furniture, household (including ice refrigerators, bed springs, and mattresses).
2. Pianos.
Group C—12 months' maximum maturity:
1. Materials and services (other than articles, whether or not designed for
household use. which are of kinds elsewhere listed) in connection with
repairs, alterations, or improvements upon urban, suburban or rural real
property in connection with existing structures (other than a structure,
or a distinct part thereof, which, as so repaired, altered or improved, is
designed exclusively for non-residential use), provided the deferred balance does not exceed $1,500.
Group D—Maximum maturity 15 months; for down payment requirement see
section 13(c):
1. Automobiles (passenger cars designed for the purpose of transporting less
than 10 passengers, including taxicabs).
2. Motorcycles (two- or three-wheel motor vehicles, including motor bicycles).

(b) Trade-in.—If any article is traded in by the purchaser on an
article listed in Group A, the cash down payment shall be one-third
of the net price of the article after deducting from the cash price the
amount allowed for the trade-in, and such cash down payment shall
be obtained in addition to the trade-in. In the case of an article listed
in Group B, the cash down payment shall be one-fifth of such net price.
In the case of automobiles and other articles listed in Group D, the
down payment required by the regulation may be made in the form of
cash or in the form of a trade-in, or both.
(c) Down Payment on Automobiles and Motorcycles.—For a new
automobile or a new or used motorcycle, the down payment (which
may be in cash or in the form of a trade-in or in both forms) shall be
one-third of the cash price.
For a used automobile the down payment (which may be in cash or
in the form of a trade-in or in both forms) shall be:
(1) One-third of the cash price if the cash price is equal to or
lower than the "appraisal guide value"; or
(2) The cash price minus two-thirds of the "appraisal guide
value" if the cash price is higher than the "appraisal guide value".
"Appraisal guide value" means the estimated average retail value
as stated in such edition of any regularly published automobile
appraisal guide as the Board may designate for this purpose for use
» Added effective May 6, 1942.
Added effective March 23, 1942.
Used furniture added effective May 6, 1942.
h
c




24

REGULATION" W

in the territory in which such used automobile is sold, plus any applicable sales taxes. Information as to the guide or guides designated
for any given territory may be obtained from any Federal Reserve
Bank or branch.
(d) Down Payment Where Price is Fixed by Federal Authorities.—
In the case of any article for which the Federal price authorities have
prescribed a maximum retail price, the amount of credit extended pursuant to the provisions of section 4 shall in no event exceed the amount
which would have been permitted if the article had been sold at the
maximum retail price.
(e) Maximum Amount of Loan.—A loan to purchase an article
listed in Group A in connection with which the seller has accepted a
trade-in shall not exceed two-thirds of the net price of the listed
article after deducting from the cash price the amount allowed for
the trade-in, and, in the case of an article listed in Group B, the loan
shall not exceed four-fifths of such net price.
A loan to purchase a used automobile shall not exceed two-thirds
of the cash price or two-thirds of the "appraisal guide value" of the
automobile, whichever is lower.
SECTION 14. ENFORCEABILITY OF CONTRACTS

Except as may subsequently be otherwise provided, all provisions
of this regulation are designated, pursuant to section 2(d) of the
Executive Order, as being "for administrative purposes" within the
meaning of said section 2(d), which provides that noncompliance with
provisions of the regulation so designated shall not affect the right to
enforce contracts.
SECTION 15. EFFECTIVE DATE OF REGULATION

This regulation became effective in its original form September 1,
1941; Amendment No. 1 became effective September 20, 1941; Amendment Xo. 2 became effective December 1, 1941; Amendment Xo. 3
became effective March 23, 1942, except that the change made in
Part 3(b> of the Supplement by Amendment No. 3 became effective
April 1, 1942. This revised regulation shall become effective May 6,
1942.




LIST OF FEDERAL RESERVE BANKS AND BRANCHES
Federal Reserve Bank of
BOSTON
NEW YORK
Buffalo Branch
PHILADELPHIA
CLEVELAND
Cincinnati Branch
Pittsburgh Branch ,.

Address
30 Pearl Street, Boston, Massachusetts
33 Liberty Street, New York, New York
270-276 Main Street, Buffalo, New York
925 Chestnut Street, Philadelphia, Pennsylvania
East 6th Street and Superior Avenue, Cleveland, Ohio
Fourth and Race Streets, Cincinnati, Ohio
717 Grant Street, Pittsburgh, Pennsylvania

RICHMOND
Baltimore Branch
Charlotte Branch

9th and Franklin Streets, Richmond, Virginia
Calvert and Lexington Streets, Baltimore, Maryland
First National Bank Building, Charlotte, North
Carolina

ATLANTA
Birmingham Branch
Jacksonville Branch
Nashville Branch
New Orleans Branch

104 Marietta Street, Atlanta, Georgia
18th Street and 5th Avenue, North, Birmingham,
Alabama
Church and Hogan Streets, Jacksonville, Florida
228 3rd Avenue, North. Nashville, Tennessee
Carondelet and Common Streets, New Orleans,
Louisiana
230 South LaSalle Street, Chicago, Illinois
160 Fort Street, West, Detroit, Michigan

CHICAGO
Detroit Branch
ST. LOUIS
Little Rock Branch
Louisville Branch
Memphis Branch
MINNEAPOLIS
Helena Branch
KANSAS CITY
Denver Branch
Oklahoma City Branch
Omaha Branch

411 Locust Street, St. Louis. Missouri
121 West 3rd Street, Little Rock. Arkansas
5th and Market Streets, Louisville, Kentucky
3rd and Jefferson Streets, Memphis, Tennessee
73 South Fifth Street, Minneapolis, Minnesota
Park Avenue and Lawrence Street, Helena, Montana
10th Street and Grand Avenue, Kansas City, Missouri
17th and Arapahoe, Denver. Colorado
226 West Third Street, Oklahoma City, Oklahoma
1701-5 Dodge Street, Omaha, Nebraska

DALLAS
El Paso Branch
Houston Branch
San Antonio Branch

Wood and Akard Streets, Dallas, Texas
351 Myrtle Avenue, El Paso, Texas
1301 Texas Avenue, Houston, Texas
Navarro and Villita Streets, San Antonio, Texas

SAN FRANCISCO

Sacramento and Sansome Streets. San Francisco,
California
409 West Olympic Boulevard, Los Angeles, California
6th and Oak Streets, Portland, Oregon
70 East South Temple Street. Salt Lake City. Utah
2nd Avenue and Spring Street, Seattle, Washington

Los Angeles Branch
Portland Branch
Salt Lake City Branch
Seattle Branch




FEDERAL RESERVE DISTRICTS

_ M
——

IOUNDAHM OF FIOEML KESEtVC pISMICTS
BOUMDARIE6 OF FEDERAL HESEUVE HAMCH TE»«irO*lES
iAPPROIIMATE IN IHI ST. LOUIS DISTRICT)

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•
O

FEDE»*L RESERVE l A N t CITIH
FEDHAL RISERVE (KANCH CITIES
FEDMAL RESERVE IANK AGENCY




Please forward to us
..additional copies of Regulation W of the Board of Governors of the
Federal Reserve System as revised effective May 6, 1942;
..copies of Registration Statement designated as Form F.R. 563-a; and
..additional copies of your Circular No. 2 4 2 8 .

(Date)



(•Name—typewrite or print)
(Street Address)

(City or Town)

(State)

FEDERAL RESERVE BANK OF NEW YORK




Federal Reserve Station, P. 0.,
New York, N. Y.


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102