Application of Finance Charge Collections Clause Samples

The Application of Finance Charge Collections clause defines how payments received as finance charges are allocated among various parties or accounts. Typically, this clause outlines the order in which collected finance charges are distributed, such as first covering administrative fees, then interest, and finally principal or other obligations. Its core practical function is to ensure a clear and consistent method for applying finance charge payments, thereby reducing disputes and providing transparency in financial transactions.
Application of Finance Charge Collections. On each Settlement Date, Servicer will apply (i) the Finance Charge Collections on deposit in the Second-Tier Account and (ii) all remaining Principal Collections after making the distributions pursuant to clauses first and second of subsection (b) above, pursuant to Section 2.2(a), together with the applicable Hedge Floating Amount, if any, paid to Seller by each Hedge Provider and any net income from Permitted Investments deposited to the Second-Tier Account pursuant to Section 2.8, in accordance with the applicable Payment Instructions, to make the following distributions in the following amounts and order of priority: first, to the reimbursement of Agent’s, each Purchaser’s and each Purchaser Agent’s costs of collection and enforcement of this Agreement, second, to Agent for the account of the Purchasers, all accrued and unpaid fees under any Fee Letter and all accrued and unpaid CP Costs and Financial Institution Yield, including any accrued CP Costs and Financial Institution Yield in respect of Capital reduced pursuant to clause second of subsection (b) above, together with any Broken Funding Costs, third, if Servicer is not then Seller or an Affiliate of Seller, to Servicer in payment of the Servicing Fee, fourth, to Agent as a reduction of Aggregate Capital an amount necessary to pay in full the Outstanding Balance of any Receivables that became Defaulted Receivables during the related Settlement Period and Receivables that became Defaulted Receivables during any prior Settlement Period that have not previously been the subject of payment hereunder, fifth, if Seller or an Affiliate of Seller is then acting as Servicer, to Servicer in payment of the Servicing Fee, sixth, to the applicable Persons, for the ratable payment in full of all other unpaid Obligations, and seventh, the balance, if any, in the following priority: first, to Agent for deposit to the Second-Tier Account if the conditions of Section 7.3 requiring that the Hedging Agreements be in effect have occurred, but the Hedging Agreements are not then in effect (such amount to be set aside and held in trust for application in accordance with this Section 2.2(c) on the next occurring Settlement Date), and then second, subject to Section 2.6, to Seller as RPA Deferred Purchase Price.
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Application of Finance Charge Collections. On each Distribution Date, the Collection Agent shall cause Finance Charge Collections of all Transferred Receivables and investment earnings on deposit in the Collection Account, the Spread Account and the Excess Funding Account, all to the extent received during the preceding Monthly Period and, to the extent necessary, funds on deposit in the Spread Account on such Distribution Date, to be distributed to the following Persons in the following amounts and in the order set forth below: (a) First, to the Deal Agent for payment to each Investor, as their ----- interests may appear, the accrued and unpaid Discount for the prior Monthly Period; (b) Second, to the Deal Agent for payment of the fees due and payable on ------ such Distribution Date pursuant to the Fee Letter; (c) Third, to the Collection Agent, the accrued and unpaid Servicing Fee ----- for the prior Monthly Period; (d) Fourth, to be applied pursuant to Section 2.6 below as a Principal ------ ----------- Collection, an amount equal to the aggregate Dollar amount of the Principal Balance of all Transferred Receivables that become Defaulted Receivables during the prior Monthly Period; (e) Fifth, for any Distribution Date on or after the Termination Date, to ----- the reduction to zero of the Net Investment; (f) Sixth, to the Spread Account in an amount equal to the excess, if any ----- of Spread Account Required Amount on such Distribution Date over the Spread ---- Account Balance on such day; (g) Seventh, to each Affected Party and each Indemnified Party, any amount ------- due and owing to such Person to the extent such amount has not been paid on such day; and (h) Eighth, any remaining amount to the Transferor. ------
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Related to Application of Finance Charge Collections

  • Allocations of Finance Charge Collections The Servicer shall allocate to the Series 1997-1 Certificateholders and retain in the Collection Account for application as provided herein an amount equal to the product of (A) the Floating Allocation Percentage and (B) the Series 1997-1 Allocation Percentage and (C) the aggregate amount of Collections of Finance Charge Receivables deposited in the Collection Account on such Deposit Date.

  • Excess Finance Charge Collections Any amounts remaining in the Cap Proceeds Account, the Collection Account and the Payment Reserve Account, to the extent of any Available Series 1998-3 Finance Charge Collections remaining after giving effect to the withdrawals pursuant to subsection 4.9(a)(i) through (xii) of the Agreement, shall be treated as Excess Finance Charge Collections, and the Servicer shall direct the Trustee in writing on each Business Day to withdraw such amounts from the Collection Account and to first make such amounts available to pay to Securityholders of other Series to the extent of shortfalls, if any, in amounts payable to such Securityholders from Finance Charge Collections allocated to such other Series, then to pay any unpaid commercially reasonable costs and expenses of a Successor Servicer, if any, and then on each Business Day other than the Default Recognition Date, to pay to the Transferor to be treated as "Transferor Retained Finance Charge Collections," and, on each Default Recognition Date, to pay any remaining Excess Finance Charge Collections to the Transferor. Notwithstanding the foregoing, if on any Default Recognition Date the sum of the amount of Available Series 1998-3 Finance Charge Collections (including, all amounts on deposit in the Payment Reserve Account) and Transferor Retained Finance Charge Collections is less than the Series Default Amount for such Default Recognition Date, the Servicer shall apply amounts deposited in the Accumulation Period Reserve Account pursuant to subsection 4.9(a)(xi) of the Agreement and the Spread Account pursuant to subsection 4.9(a)(viii) of the Agreement during the then current Monthly Period in accordance with subsection 4.9(a)(iii) of the Agreement to the extent of such shortfall.

  • Shared Principal Collections Subject to Section 4.04 of the Agreement, Shared Principal Collections for any Distribution Date will be allocated to Series 2017-6 in an amount equal to the product of (x) the aggregate amount of Shared Principal Collections with respect to all Principal Sharing Series for such Distribution Date and (y) a fraction, the numerator of which is the Series 2017-6 Principal Shortfall for such Distribution Date and the denominator of which is the aggregate amount of Principal Shortfalls for all the Series which are Principal Sharing Series for such Distribution Date. The “Series 2017-6 Principal Shortfall” will be equal to (a) for any Distribution Date with respect to the Revolving Period, zero, (b) for any Distribution Date with respect to the Controlled Accumulation Period, the excess, if any, of the Controlled Deposit Amount with respect to such Distribution Date over the amount of Available Principal Collections for such Distribution Date (excluding any portion thereof attributable to Shared Principal Collections), and (c) for any Distribution Date with respect to the Early Amortization Period, the excess, if any, of the Invested Amount over the amount of Available Principal Collections for such Distribution Date (excluding any portion thereof attributable to Shared Principal Collections).

  • Application of Collections All collections for the Collection Period shall be applied by the Servicer as follows: (a) With respect to each Receivable (other than a Purchased Receivable or a Sold Receivable), payments by or on behalf of the Obligor, (other than Supplemental Servicing Fees with respect to such Receivable, to the extent collected) shall be applied to interest and principal in accordance with the Simple Interest Method. (b) All amounts collected that are payable to the Servicer as Supplemental Servicing Fees hereunder shall be deposited in the Collection Account and paid to the Servicer in accordance with Section 5.7(a).

  • Finance Charge Each Receivable provides for the payment of a finance charge or shall yield interest calculated on the basis of an APR ranging from 0.50% to 22.05%.