(a) Right to prepay unpaid time balance.--Notwithstanding the provisions of an installment sale contract, a buyer may prepay at any time all or part of the unpaid time balance under the contract.
(b) Rebate generally.--If the entire time balance is liquidated prior to maturity by prepayment, refinancing or termination by surrender or repossession and resale of the motor vehicle, a holder of the contract for the sale of the motor vehicle shall immediately rebate to the buyer any unearned portion of the finance charge. The rebate may be made in cash or credited to the amount due on the obligation of the buyer.
(c) Rebate amount.--
(1) Subject to paragraph (2), the proportion of the unearned finance charge that shall be rebated to the buyer to the total finance charge shall be at least the proportion of the sum of the periodic time balances after the date of prepayment to the sum of all the periodic time balances under the schedule of payments in the original contract.
(2) The holder is not required to rebate:
(i) a portion of the unearned finance charge that results in a net minimum finance charge on the contract of less than $10; or
(ii) an unearned finance charge if the computed amount due is less than $1.