The term credit card includes a hybrid prepaid-credit card as defined in §
ii. As noted in § 1026.2(a)(15)(ii)(C), the exclusion from credit card account under an open-end (not home-secured) consumer credit plan provided by that paragraph for an overdraft line of credit that is accessed by an account number does not apply to a covered separate credit feature accessible by a hybrid prepaid-credit card (including a hybrid prepaid-credit card that is solely an account number) as defined in § .
(i) Credit card means any card, plate, or other single credit device that may be used from time to time to obtain credit.
(ii) Credit card account under an open-end (not home-secured) consumer credit plan means any open-end credit account that is accessed by a credit card, except:
(C) An overdraft line of credit that is accessed by an account number, except if the account number is a hybrid prepaid-credit card that can access a covered separate credit feature as defined in §
(iii) Charge card means a credit card on an account for which no periodic rate is used to compute a finance charge.
(iv) Debit card means any card, plate, or other single device that may be used from time to time to access an asset account other than a prepaid account as defined in § . The term debit card does not include a prepaid card as defined in § .
(16) Credit sale means a sale in which the seller is a creditor. The term includes a bailment or lease (unless terminable without penalty at any time by the consumer) under which the consumer:
1. Special disclosure. If the seller is a creditor in the transaction, the transaction is a credit sale and the special credit sale disclosures (that is, the disclosures under § (j)) must be given. This applies even if there is more than one creditor in the transaction and the creditor making the disclosures is not the seller. (See the commentary to § (d).)
Thus, if a seller assists the consumer in obtaining a direct loan from a financial institution and the consumer’s note is payable to the financial institution, the transaction is a loan and only the financial institution is a creditor
2. If the seller of the property or services involved arranged for financing but is not a creditor as to that sale, the transaction is not a credit sale.
3. Refinancings. Generally, when a credit sale is refinanced within the meaning of § (a), loan disclosures should be made. However, if a new sale of goods or services is also involved, the transaction is a credit sale.
4. Incidental sales. Some lenders sell a product or service – such as credit, property, or health insurance – as part of a loan transaction. Section 1026.4 contains the rules on whether the cost of credit life, disability or property insurance is part of the finance charge. If the insurance is financed, it may be disclosed as a separate credit-sale transaction or disclosed as part of the primary transaction; if the latter approach is taken, either loan or credit-sale disclosures may be made. (See the commentary to § (c)(1) for further discussion of this point.)
Sellers who arrange credit
5. Credit extensions for educational purposes. A credit extension for educational purposes in which an educational institution is the creditor may be treated as either a credit sale or a loan, regardless of whether the funds are given directly to the student, credited to the student’s account, or disbursed to other persons on the student’s behalf. The disclosure of the total sale price need not be given if the transaction is treated as a loan.