5-3-302. Limitation on default charges.

Statute text

Except for reasonable expenses incurred in realizing on a security interest, the agreement with respect to a consumer credit transaction may not provide for charges as a result of default by the consumer other than those authorized by this code. A provision in violation of this section is unenforceable.

History

Source: L. 2000: Entire article R&RE, p. 1221, 1, effective July 1.

Annotations

Editor's note: This section is similar to former 5-2-414 and 5-3-405, as they existed prior to 2000.

Annotations

 

ANNOTATION

Annotations

Because this section provides that only those charges allowable elsewhere under the UCCC plus reasonable expenses in realizing a security interest are permissible as default charges, higher default interest on a note is unenforceable. First Nat. Bank v. Union Tavern Corp., 794 P.2d 261 (Colo. App. 1990) (decided prior to 2000 repeal and reenactment).