2012 New York Consolidated Laws
PEP - Personal Property
Article 9 - (301 - 316) MOTOR VEHICLE RETAIL INSTALMENT SALES ACT
302 - Requirements as to retail instalment contracts.

 
    §  302.  Requirements  as  to retail instalment contracts. 1. A retail
  instalment  contract  shall  be  in  writing,  shall  contain  all   the
  agreements  of  the  parties  and  shall  be signed by the buyer and the
  seller.
    2. The printed portion of the contract shall  be  in  at  least  eight
  point  type.  The  contract  shall  contain printed or written in a size
  equal to at least ten-point bold type:
    (a) Both at the top of the  contract  and  directly  above  the  space
  reserved  for  the  signature of the buyer, the words "RETAIL INSTALMENT
  CONTRACT";
    (b) A specific statement that liability insurance coverage for  bodily
  injury  and property damage caused to others is not included, if that is
  the case; and
    (c) One of the following notices: "NOTICE TO THE BUYER: 1. Do not sign
  this contract before you read it or if it contains any blank  space.  2.
  You  are  entitled  to a completely filled in copy of this contract when
  you sign it. 3. Under the law, you  have  the  following  rights,  among
  others:  (a)  To  pay off in advance the full amount due and to obtain a
  partial refund of the credit service charge; (b) To redeem the  property
  if  repossessed for a default; (c) To require, under certain conditions,
  a resale of the property if repossessed. 4. According to  law  you  have
  the  privilege of purchasing the insurance on the motor vehicle provided
  for in this contract from an agent or broker of your own selection,"  or
  "NOTICE  TO  THE BUYER: 1. Do not sign this agreement before you read it
  or if it contains any blank space. 2. You are entitled to  a  completely
  filled  in  copy of this agreement. 3. Under the law, you have the right
  to pay off in advance the full amount due and under  certain  conditions
  to obtain a partial refund of the credit service charge. 4. According to
  law  you  have  the  privilege  of purchasing the insurance on the motor
  vehicle provided for in this contract from an agent or  broker  of  your
  own  selection",  or "NOTICE TO THE BUYER: 1. Do not sign this agreement
  before you read it or if  it  contains  any  blank  space.  2.  You  are
  entitled  to a completely filled in copy of this agreement. 3. Under the
  law, you have the right to pay off in advance the full  amount  due.  If
  you  do  so,  you  may,  depending  on  the nature of the credit service
  charge, either:  (a)  prepay  without  penalty,  or  (b)  under  certain
  circumstances obtain a rebate of the credit service charge. 4. According
  to  law  you have the privilege of purchasing the insurance on the motor
  vehicle provided for in this contract from an agent or  broker  of  your
  own selection".
    3.  The  seller  shall  deliver  to  the  buyer, or mail to him at his
  address shown on the contract, a copy of  the  contract  signed  by  the
  seller.  Until the seller does so, a buyer who has not received delivery
  of  the  motor  vehicle  shall have an unconditional right to cancel the
  contract and to receive  immediate  refund  of  all  payments  made  and
  redelivery  of  all  goods  traded-in  to the seller on account of or in
  contemplation of the  contract.  Any  acknowledgment  by  the  buyer  of
  delivery of a copy of the contract shall be printed or written in a size
  equal to at least ten point bold type and, if contained in the contract,
  shall  also  appear directly above the legend required above the buyer's
  signature by sub-division two (a) of this section.
    4. The contract shall contain the names of the seller and  the  buyer,
  the  place of business of the seller, the residence or place of business
  of the buyer as specified by the buyer and a description  of  the  motor
  vehicle including its make, year model, model and identification numbers
  or marks.
    5. The contract shall contain:

    (1) All items required to be disclosed by the act of congress entitled
  "Truth  in  Lending Act" and the regulations thereunder, as such act and
  regulations may from time to time be amended;
    (2)  The  amount,  if  any,  included  for  insurance,  specifying and
  describing the coverages and  the  amount  included  for  each  type  of
  coverage;  however,  if  any insurance policy complies with the standard
  provisions form for automobile  physical  damage  policy  or  any  other
  automobile  physical  damage  policy  form  which  is  equally  or  more
  favorable to the insured and which is filed with the  superintendent  of
  financial  services,  the contract need not contain a description of any
  type of coverage under such standard automobile physical  damage  policy
  form  or a specification of the amount included in the contract therefor
  if it contains a specification of the type or types of coverage and  the
  total amount included in the contract therefor.
    6.  The  amount,  if any, included for insurance, shall not exceed the
  premiums chargeable in  accordance  with  rate  filings  made  with  the
  superintendent  of  financial services for similar insurance. The seller
  or financing agency, if insurance on the motor vehicle is included in  a
  retail  instalment contract, shall within thirty days after execution of
  the retail instalment contract send or cause to be sent to the  buyer  a
  policy  or policies or certificate of insurance, written by an insurance
  company authorized to do business in this state, clearly  setting  forth
  the  amount of the premium, the kind or kinds of insurance and the scope
  of the coverage and all the terms, exceptions, limitations, restrictions
  and conditions of the contract or contracts of insurance. The buyer of a
  motor  vehicle  under  a  retail  instalment  contract  shall  have  the
  privilege  of  purchasing  such insurance from an agent or broker of his
  own selection and of selecting an insurance company  acceptable  to  the
  seller;  provided,  however, that the inclusion of the insurance premium
  in the retail instalment contract when  the  buyer  selects  the  agent,
  broker  or  company,  shall be optional with the seller and in such case
  the seller or financing agency shall have  no  obligation  to  send,  or
  cause  to  be sent, to the buyer the policy or certificate of insurance.
  Nothing contained in this subdivision however shall be deemed to modify,
  limit or in any way contravene the provisions of  section  two  thousand
  five hundred two of the insurance law.
    If any such policy or certificate of insurance on the motor vehicle is
  cancelled,  the unearned insurance premium refund received by the holder
  of the contract, or, if the amount included  therefor  in  the  contract
  exceeds  the  cost to the holder of the contract for such insurance, the
  unearned portion of the amount so included, together with  the  unearned
  portion  of  the  credit  service  charge  applicable  thereto, shall be
  credited to the final maturing  instalments  of  the  retail  instalment
  contract  except  to  the  extent  applied  toward  payment  for similar
  insurance protecting the interests of the buyer and the  holder  of  the
  contract or either of them.
    The  amount,  if any, included for group credit life insurance, credit
  unemployment insurance, or for insurance other than on the motor vehicle
  shall not exceed the premiums chargeable in accordance with rate filings
  made with the superintendent of financial services for such insurance by
  the insurer. If such group credit life or other insurance  is  cancelled
  the refund for unearned insurance premiums received or receivable by the
  holder  of  the  contract,  or  the excess of the amount included in the
  contract for group credit life  insurance  over  the  premiums  paid  or
  payable by the holder of the contract therefor, together with, in either
  case,  the  unearned  portion  of  the  credit service charge applicable
  thereto, shall be credited to the  final  maturing  instalments  of  the

  retail instalment contract, provided that no such credit need be made if
  the amount thereof would be less than one dollar.
    6-a.  If the buyer is obligated under the terms of a retail instalment
  contract to maintain insurance on the motor vehicle that is the  subject
  of  the  contract and if subsequent to the execution of the contract the
  buyer fails to maintain the insurance, the holder may make  advances  to
  procure  the  equivalent limits of insurance for either the interests of
  the buyer and the holder or  of  either  of  them,  and  any  amount  so
  advanced  may be the subject of a credit service charge from the date of
  such advance as though such amount was part of the  amount  computed  as
  provided  in  the  closing paragraph of subdivision one of section three
  hundred three of this article. Each amount so advanced shall be  secured
  by  the  motor  vehicle if so provided in the contract and if the holder
  notifies the buyer in writing of the advance of such amount and  of  his
  or her option to repay such amount in any one of the following ways:
    (a)  Full  payment  within ten days from the date of giving or mailing
  the notice;
    (b) Full  amortization  during  the  term  of  the  insurance  or  the
  remaining term of the contract, at the option of the holder;
    (c)  If  offered by the holder, as a final balloon payment payable one
  month after the last scheduled payment under the contract;
    (d) If offered by the holder, full amortization after the term of  the
  contract,  to  be payable in instalments which do not exceed the average
  instalment payable under the contract; or
    (e) If offered by the holder, any other amortization plan.
    If the buyer neither pays in full the amount so advanced nor  notifies
  the  holder  in  writing  of  his  or  her choice regarding amortization
  options before the expiration of ten days from the  date  of  giving  or
  mailing  of  the  notice  by  the  holder, the holder shall amortize the
  amount so advanced pursuant to paragraph (b) of this subdivision.
    7. The holder of a retail instalment contract may, if the contract  so
  provides, collect a delinquency and collection charge on each instalment
  in  default  for  a  period  not  less than ten days in an amount not in
  excess of the rate or rates agreed to in the contract.  In  addition  to
  such  delinquency  and collection charge, the retail instalment contract
  may provide for the payment of attorneys'  fees  not  exceeding  fifteen
  percent  of  the  amount  due and payable under such contract where such
  contract is referred to an attorney  not  a  salaried  employee  of  the
  holder of the contract for collection, plus the court costs.
    8.  No retail instalment contract shall be signed by any party thereto
  when it contains blank spaces to be filled in after it has  been  signed
  except that, if delivery of the motor vehicle is not made at the time of
  the  execution  of the contract, the identifying numbers or marks of the
  motor vehicle or similar information and  the  due  date  of  the  first
  instalment  may  be  inserted  in  the contract after its execution. The
  buyer's  written  acknowledgment,  conforming  to  the  requirements  of
  subdivision  three  of this section, of delivery of a copy of a contract
  shall be conclusive proof of such delivery and of compliance  with  this
  subdivision in any action or proceeding by or against an assignee of the
  contract  without  knowledge  to  the  contrary  when  he  purchases the
  contract.
    9. No retail instalment contract shall contain any provision by  which
  the  buyer  agrees  not to assert against an assignee a claim or defense
  arising out of the sale or require or entail the execution of  any  note
  or  series of notes, which when separately negotiated will cut off as to
  third parties any right of action or defense which the  buyer  may  have
  against  the  seller.  The  assignee of a retail installment contract or
  obligation shall be subject to all claims  and  defenses  of  the  buyer

  against  the  seller arising from the sale notwithstanding any agreement
  to the contrary, but the assignee's  liability  under  this  subdivision
  shall  not exceed the amount owing to the assignee at the time the claim
  or defense is asserted against the assignee.
    10.  Notwithstanding  any  contrary provision of the personal property
  law, lien law, banking law or other law:  (a)  a  financing  agency  may
  purchase  a  retail  instalment contract from a seller on such terms and
  conditions and for such price as may be mutually agreed upon; and (b) no
  filing of the assignment, no notice to the buyer of the assignment,  and
  no  requirement  that  the  seller be deprived of dominion over payments
  upon the contract or over the vehicle if repossessed by or  returned  to
  the  seller,  shall be necessary to the validity of a written assignment
  of  a  retail  instalment  contract  as  against  creditors,  subsequent
  purchasers, pledgees, mortgagees or encumbrancers of the seller.
    11.  Unless the buyer has notice of actual or intended assignment of a
  retail instalment contract, payment thereunder made by the buyer to  the
  last  known holder of such contract shall be binding upon all subsequent
  holders or assignees.
    12. Upon written request from  the  buyer,  the  holder  of  a  retail
  instalment  contract  shall  give  or  forward  to  the  buyer a written
  statement of the dates and amounts of  payments  and  the  total  amount
  unpaid under such contract. A buyer shall be given a written receipt for
  any payment when made in cash.
    13.  No  retail  instalment  contract  shall  contain any provision by
  which:
    (a) in the absence of the buyer's default, the holder may, arbitrarily
  and without reasonable cause, accelerate the maturity of any part or all
  of the amount owing thereon;
    (b) a power of attorney is given to confess judgment in this state, or
  an assignment of wages is given;
    (c) the seller or holder of the contract or other person acting on his
  behalf is given authority to enter upon the buyer's premises unlawfully,
  or to commit any breach of the peace in the repossession  of  the  motor
  vehicle;
    (d)  the buyer waives any right of action against the seller or holder
  of the contract, or other person acting on his behalf, for  any  illegal
  act committed in the collection of payments under the contract or in the
  repossession of the motor vehicle;
    (e)  the  buyer  executes a power of attorney appointing the seller or
  holder of the contract, or other person acting on  his  behalf,  as  the
  buyer's  agent  in  collection  of payments under the contract or in the
  repossession  of  the  motor  vehicle;  provided,  however,  that   this
  paragraph  shall  not  prohibit  the  inclusion  in  a retail instalment
  contract of a limited power of attorney or other  provision  authorizing
  the  holder  to execute in the name of the buyer any proofs of insurance
  claims or losses or to endorse the name of the buyer  on  any  insurance
  settlement draft or check;
    (f)  the  seller is relieved from liability for any legal remedy which
  the buyer may have had against the seller under  the  contract,  or  any
  separate instrument executed in connection therewith;
    (g)  the  maturity  of  any part or all of the amount owing thereon is
  accelerated where, following a default consisting solely of the  failure
  to  make  timely  instalment payments and the subsequent repossession of
  the motor vehicle, the buyer makes timely  tender  of  an  amount  which
  would  be  sufficient  to  redeem  the  vehicle  in  the absence of such
  provision;
    (h) the buyer waives any right to a trial by jury  in  any  action  or
  proceeding arising out of the contract.

    14.  Any  such  prohibited  provision  shall  be  void  but  shall not
  otherwise affect the validity of the contract.