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IC 24-7-4
Chapter 4. Limitations
IC 24-7-4-1
Ownership acquisition
Sec. 1. At any time after the first rental payment is made, the
lessee may acquire ownership of the property under the terms
specified in the rental purchase agreement.
As added by P.L.254-1987, SEC.1.
IC 24-7-4-2
Contractual abridgement of rights and duties
Sec. 2. A rental purchase agreement may not contain a provision
that conflicts with the rights and duties imposed under this article.
As added by P.L.254-1987, SEC.1.
IC 24-7-4-3
Assignment of earnings as payment
Sec. 3. (a) A lessor may not accept an assignment of earnings
from the lessee for payment or as security for payment for a charge
arising under a rental purchase agreement.
(b) An assignment of earnings in violation of this section is
unenforceable by the assignee of the earnings and revocable by the
lessee.
(c) This section does not prohibit a lessee from authorizing
deductions from the lessee's earnings if the authorization is revocable
and is otherwise permitted by law.
As added by P.L.254-1987, SEC.1.
IC 24-7-4-4
Acceptance of authorization on behalf of lessee waiving service of
process, confessing judgment, or enforcing payment
Sec. 4. A lessor may not take or accept a power of attorney or
other authorization from the lessee, or other person acting on the
lessee's behalf, to waive service of process, confess judgment, or
enforce payment of money claimed by the lessor in violation of
IC 34-54-3 or IC 34-54-4.
As added by P.L.254-1987, SEC.1. Amended by P.L.1-1998,
SEC.130.
IC 24-7-4-5
Required waiver of lessee's defenses, counterclaims, or rights of
action in collecting payments or charges
Sec. 5. A lessor may not require a lessee to waive any defense,
counterclaim, or right of action against:
(1) the lessor; or
(2) a person acting on the lessor's behalf, as the lessee's agent;
in collection of rental payments or charges under the rental purchase
Indiana Code 2016
agreement.
As added by P.L.254-1987, SEC.1.
IC 24-7-4-6
Repossession limited
Sec. 6. A lessor may not require a lessee to authorize the lessor or
a person acting on the lessor's behalf to unlawfully enter upon the
lessee's premises or to commit any breach of the peace in the
repossession of the property.
As added by P.L.254-1987, SEC.1.
IC 24-7-4-7
Prejudgment garnishment
Sec. 7. A lessor may not require a lessee to authorize a
prejudgment garnishment of the lessee's wages.
As added by P.L.254-1987, SEC.1.
IC 24-7-4-8
Repealed
(Repealed by P.L.45-1995, SEC.33.)
IC 24-7-4-9
Assignee of lessor's rights; lessee's rights against assignee;
contractual abridgement of lessee's claims or defenses
Sec. 9. (a) With respect to a rental purchase agreement, an
assignee of the rights of the lessor is subject to all claims and
defenses of the lessee against the lessor arising from the lease of
property or services.
(b) A claim or defense of a lessee specified in subsection (a) may
be asserted against the assignee under this section only if the lessee
has made a good faith attempt to obtain satisfaction from the lessor
with respect to the claim or defense and then only to the extent of the
amount owing the assignee with respect to the sale or the lease of the
property or services to which the claim or defense arose at the time
the assignee has written notice of the claim or defense. Written
notice of the claim or defense may be given before the attempts
specified in this subsection. For the purposes of this subsection,
written notice is any written notification other than notice on a
coupon, billing statement, or any other payment medium or material
supplied by the assignee.
(c) An agreement may not limit or waive the claims or defenses
of a lessee under this section.
As added by P.L.254-1987, SEC.1. Amended by P.L.45-1995,
SEC.18.
IC 24-7-4-10
Notice and proof of assignment
Sec. 10. (a) The lessee may pay the original lessor until the lessee
Indiana Code 2016
receives written notification:
(1) that assignment of the rights to rental payments under the
rental purchase agreement has occurred; and
(2) of the person to whom rental payments are to be made.
(b) A notification that does not reasonably identify the rights
assigned is ineffective.
(c) If requested by the lessee, the assignee must take reasonable
steps to furnish proof that the assignment has been made. Unless the
assignee furnishes the proof, the lessee may pay the original lessor.
As added by P.L.254-1987, SEC.1.
IC 24-7-4-11
Additional payments
Sec. 11. Except as provided in section 1 of this chapter, a lessee
may not be required to:
(1) make any payment in addition to regular rental payments in
order to acquire ownership of the property; or
(2) pay rental payments totaling more than the cost to acquire
ownership stated in the rental purchase agreement.
As added by P.L.254-1987, SEC.1.
IC 24-7-4-12
Mandatory insurance; early termination of agreement or item
return penalties; fees or charges imposed on cosigner
Sec. 12. A lessor may not require any of the following:
(1) The mandatory purchase of insurance by the lessee from the
lessor.
(2) A penalty for early termination of a rental purchase
agreement or for the return of an item at any point, except
charges authorized under IC 24-7-5.
(3) A payment by a cosigner of the rental purchase agreement
for any fees or charges that may not be imposed on the lessee as
part of the rental purchase agreement.
As added by P.L.254-1987, SEC.1.
IC 24-7-4-13
Acceptance and application of payments; payments exceeding
scheduled amount due
Sec. 13. (a) Except as provided in subsection (b), a lessor may not
accept payment from a lessee and hold the amount of the payment in
a reserve account for future payments. Any amounts paid by a lessee
must be applied as a rental payment or to an accrued permissible
additional charge.
(b) If a lessee makes a payment that exceeds the sum of the
scheduled rental payment and any permitted additional charges that
are due, the lessor may hold the excess funds in a reserve account
subject to the following conditions:
(1) The balance of the lessee's reserve account may not exceed
Indiana Code 2016
the amount of the next scheduled rental payment.
(2) If the balance in the lessee's reserve account reaches the
limit specified in subdivision (1), the lessor shall apply the
funds to the lessee's next scheduled rental payment.
(c) This section may not be construed to preclude a lessor from
accepting and applying multiple rental payments before the rental
payments' scheduled due dates.
As added by P.L.35-2010, SEC.90.
Indiana Code 2016
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