Virginia § 6.2-1409 - Prepayment by borrower from association; rebates for unearned interest; prepayment penalty
Full text of Virginia Code of Virginia § 6.2-1409 — Prepayment by borrower from association; rebates for unearned interest; prepayment penalty, with citation guidance and answers to common questions.
§ 6.2-1409. Prepayment by borrower from association; rebates for unearned interest; prepayment penalty
A. Any individual borrowing from an association shall have the right to anticipate payment of his debt at any time.
B. If interest has been added to the face amount of the note, the borrower shall have the right, upon prepayment of the debt, to receive a rebate by way of credit for any unearned interest. The rebate shall be computed:
1. On loans (i) with an initial maturity and corresponding amortization period of 61 months or less and (ii) payable in equal periodic installments, in accordance with the Rule of 78 as illustrated in § 6.2-403 or by using any other method that is at least as favorable to such borrower; and
2. On other loans, under a method at least as favorable to the borrower as the actuarial method.
C. An association may charge a prepayment penalty not to exceed two percent of the amount of the prepayment, provided such prepayment penalty, including the percent thereof, is set forth in the contract of indebtedness and is disclosed to the borrower pursuant to applicable federal interest disclosure laws.
1987, c. 622, § 6.1-330.84; 1990, c. 338; 1991, c. 171; 2010, c. 794.
Source: official Virginia text · Last verified 2026-08-27
Frequently Asked Questions About Virginia § 6.2-1409
What does Code of Virginia § 6.2-1409 cover?
Section 6.2-1409 ("Prepayment by borrower from association; rebates for unearned interest; prepayment penalty") is part of the Code of Virginia, the codified statutory law of Virginia. It sets out the legal rule or procedure described in the text above. Statutes are amended regularly, so always verify against the official source.
How do I cite Virginia § 6.2-1409?
A common citation format is "Code of Virginia § 6.2-1409" (Virginia). Legal writing may require the code abbreviation, section number, and year or edition. Match the style required by your court, professor, or publisher.
Is this the official text of Virginia law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the Virginia official source linked on this page or consult a licensed Virginia attorney.
How does Virginia § 6.2-1409 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in Virginia can advise on how this section applies to you. Contact your state or local bar association for a referral.
Sources & Verification
Not legal advice. Verify against the official source and consult a licensed attorney in Virginia.