(a) A retail installment contract that is payable in substantially equal monthly payments beginning one month after the date of the contract may provide for a time price differential that does not exceed an add-on charge equal to:
(1) $12 per $100 per year on the part of the principal balance that is less than or equal to the amount computed under Subchapter C, Chapter 341, using the reference amount of $500;
(2) $10 per $100 per year on the part of the principal balance that is more than the amount computed for Subdivision (1) but less than or equal to the amount computed under Subchapter C, Chapter 341, using the reference amount of $1,000; and
(3) $8 per $100 per year on the part of the principal balance that is more than the amount computed for Subdivision (2).
(b) The time price differential is computed on the original principal balance from the date of the contract until the due date of the final installment, notwithstanding that the balance is payable in installments.
(c) If the retail installment contract is payable for a period that is shorter or longer than a year or is for an amount that is less or greater than $100, the amount of the maximum time price differential computed under this section is decreased or increased proportionately.
(d) For the purpose of a computation under this section, 15 or more days of a month may be considered a full month.