A quick guide to Regulation 7

Thc mntcrial presented here f.rst appeared, in a bullctin ol the Lumber Association ol Southern Calilornia, Like similar summa.rics issucd, by associations throughout the West, this is not the lnw, it is only a guiileline n the law. Interested read,ers utho lnue not yet receiaed, the Feileral Trade Commissr,on's booHet, "Wlwt You Ought to Know About Regulation 2," shou.ld @ntoct their nearest FTC oft,ce.-Eilinr.

Regulation Z, which tbecame effective July l, covers only consumer credit. It does not cover sontractor or industrial sales. Consumer credit means credit extended to a natural person for materials or services which are to be used for personal, family household or agricultural purposes, and for which a finance charge is or may be imposed, or which is or may be payable in four or more installments. Revolving charge accounts are also affected.

(a) A cash discount for prompt payrent is construed as a finance charge under the law, when offered to a consumer; therefore, it must be shown on the billing statement. See Sec. 226.8(o) in buff colored book. Iet for correct wording.

Thirty day accounts (consumer)-Normal 30 day accounts are exempt from the Iaw; however, if a charge is made for carrying the account over 30 dayq such a charge can no longer be referred to as a service chargg since service charge under the law is considered a finance charge. It is suggested that the wording might be ttlate payment," ttdelinquency" or ttdefaulttt chargeo rather than "serviceo'charge. It is also advisable to disallow anv additions being made to the account by way of pur. chases, at the end of the first stated period, since such adfitions could be taken to mean granting of credit and therefore subject to the ooTruth-in-Lending" law.

Disclosure Requirements-When credit is granted as is the case for revolving charge accounts, certain disclosures must be made to the person opening the account. They are:

(a) When the finance charge will be imposed and when an account can be cleared up without a finance charge being applied.

(b) The amount of the finance charge, botl as a period rate and an annual rate. (Example: lI/z% per month on unpaid balance is an annual rate of lB%).

(c) That under California constitution, for example, a lien may be filed upon the real estate for monies due to a supplier for materials furnished for improvement of the property, if such monies are not paid to the supplier when due.

Right of Recission-A dealer must furnish a customer with a notice of his right of recission if he makes a sale on credit whereby a security interest is involved. This tells the customer he has three days to accept your price, credit terms, etc. The customer may eancel within the thre day period and if, as the dealer, you should have delivered any material, you must pick it up within ten days or it belongs to the customer (at no charge to him)

Any new account opened after July l, must be notified at the time account ie opened.

On any account opened on July l, notifi. cation must be given to tJre customer before July 31.

Billing statements must carry certain information-check the book on "Regulat)on 2," to make certain your present forms comply. If they do not, alterations may be (Continued, on Page 29)

Hordwood Groding Shorr Course

The Northwest Hardwood Association re cently concluded a four day hardwood lumber grading short course in Los Angeles, held at Tarter, Webster & Johnson's beautilul new distribution yard in outlying Cerrito6.

Instructing was Charles Slocum, president of Pacific Coast Hardwoods, Inc., No. Portland, Ore., and current vp. of tle NHA. No dry textbook affair, the school was held in, around and on piles of lumber in TW&J's hardwood section, courtesy of hardwood dept. urgr. Dick Lambert, who also helped organize the school.

Included in the enrollment were local area hardwoodmen, forestry people from Oregon, an Air Force Captain interested in later getting into the furniture business and several novice graders,

Lumbermon's Son Honorcd

Air Force Major Philip B. Gilbert Jr., eldest son of Phil Gilbert, Sr., of Coos Head Lumber and Plywood Co., Wilnington, Calif., was recently decorated in EngIand, with 15 military medals for action in Southeast Asia.

He received the Distinguished Flying Cross, 13 Air Medals and tle Air Force Commendation Medal.

The Distinguished Flying Cross was awarded for ooextraordinary achievement" as a forward air controller near Euc Co, Vietnam, last year. He flew in support of beleaguered ground forces and, "despite the hazards of approaching darknesg low clouds and dense ground fire, successlully guided his unarmed aircraft low over the enemy forces and successfully directed tactical air power against their fortifications."

(Continuzd lrom Page 28) made to make them comply until December 31, 1969. But in order to take advantage of this leewayo a dealer must be able !o demonstrate that he has taken bona fidestelrs to obtain new forms and that these were taken prior to July l. Once new forms arrivg they must be us€d.

Since each dealer's method of invoicing and billing is slightly differeng each must make the determination as to how to alter his operation to conform to the law. Read the books furnished carefully. Analyze the sample forms and make the decision regarding your operation.

The Federal Trade Commission is continuously issuing interpretations regarding certain points of the law. One such interpretation states that under Seclion 226.3, credrt given to an organization which may be a corporation, a trust, estate, parbnership, cooperative or association for agricultural purpoces is exempt frotn the regulation.