Bank Act (S.C. 1991, c. 46)

Marginal note:Default charges

627.3 If a natural person fails to make a payment when it becomes due under a credit agreement that the person entered into other than for business purposes or fails to comply with any other obligation in the agreement an institution may impose, in addition to interest, other charges for the sole purpose of recovering the costs reasonably incurred

• (a) for legal services retained to collect or attempt to collect the payment;

• (b) in realizing on any security interest taken under the credit agreement or in protecting such a security interest, including the cost of legal services retained for that purpose;

• (c) in processing a cheque or other instrument that the person used to make a payment under the loan but that was dishonoured; or

• (d) for any prescribed purpose.