2023 New York Laws › PEP - Personal Property › Article 10 - Retail Instalment Sales Act › 402 - Provisions of Retail Instalment Contracts and Obligations.

§ 402. Provisions of retail instalment contracts and obligations. 1. A
retail  instalment contract or obligation shall be dated and in writing;
the printed portion thereof shall be in at least eight point type.
2. A contract or obligation shall contain the entire agreement of  the
parties  with  respect to the goods and services, including any promise,
whether made in writing or orally, by the seller, made as an  inducement
to  the  buyer to become a party to the contract or which is part of the
contract or which is made incidental to negotiations between the  seller
and the buyer with respect to the sale of the goods or services that are
the  subject  of the contract, that the seller will compensate the buyer
for referring customers or prospective customers to the seller for goods
or services which the seller has for sale or for referring the seller to
such customers or prospective customers. In any case in which,  pursuant
to  the  preceding  provisions,  the  contract  contains  a  promise  to
compensate the buyer for referring customers or prospective customers to
the seller or the seller to such customers, the contract must contain  a
provision  to  the  effect  that  the  amount  otherwise owing under the
contract at any time is reduced by  the  amount  of  compensation  owing
pursuant to such promise, and:
(a)  Both  at the top of the contract or obligation and directly above
the space reserved for the signature of  the  buyer,  the  words  RETAIL
INSTALMENT CONTRACT or RETAIL INSTALMENT OBLIGATION, as the case may be,
in at least ten point bold type; and
(b)  Either  a  notice  in  at  least eight point bold type reading as
follows: 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 or  a
notice  in  at least eight point bold type reading as follows: 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.
3. A contract or obligation shall:
(a) 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 an adequate description  of  the  services
and  goods  (including  the make and model, if any, in the case of goods
customarily sold by make and model); and
(b) Set forth the following items:
(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)  If  any  instalment  substantially  exceeds  in  amount any prior
instalment other than the down-payment,  contain  the  following  legend
printed  in  ten  point  bold  type or typewritten: THIS CONTRACT IS NOT
PAYABLE IN INSTALMENTS OF EQUAL AMOUNTS: followed, if there be  but  one
larger  instalment,  by:  AN  INSTALMENT  OF  $..........WILL  BE DUE ON
.........or, if there be more than one  larger  instalment,  by:  LARGER
INSTALMENTS WILL BE DUE AS FOLLOWS.........(insert the amount or amounts
of  every  larger  instalment and its due date.) In the case of a retail
instalment obligation, OBLIGATION shall be substituted for  CONTRACT  in
the  required  legend.  If the credit service charge with respect to the
contract or obligation is calculated pursuant  to  subdivision  four  of

section  four  hundred four of this article, the disclosure provided for
in this subparagraph may be omitted.
4.  No  contract  or  obligation  shall be signed by the buyer when it
contains blank spaces to be filled in after it has been signed; however,
if delivery of the goods is not made at the time of the execution of the
contract or obligation and it so provides, the  identifying  numbers  or
marks  of the goods and the due date of the first instalment may be left
blank and later inserted by the seller in the  seller's  counterpart  of
the contract or obligation after it has been signed by the buyer.
5.  If the cost of any credit unemployment, group credit life or other
insurance is included in the  contract  or  obligation  and  a  separate
charge is made to the buyer for such insurance:
(a) The contract or obligation shall state whether the insurance is to
be procured by the buyer or the seller;
(b)  The  amount,  if  any,  so included for such insurance, shall not
exceed the premiums chargeable in accordance with rate filings made with
the superintendent of financial  services  for  such  insurance  by  the
insurer; and, 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; and
(c)  If  the  insurance  is to be procured by the seller or holder, he
shall, within thirty days after delivery of the goods or  furnishing  of
the services under the contract or obligation, deliver, mail or cause to
be  mailed  to the buyer, at his address as specified in the contract or
obligation, a notice thereof or a copy of  the  policy  or  policies  of
insurance or a certificate or certificates of the insurance so procured.
6.  A  contract or obligation may provide for the payment by the buyer
of a delinquency and collection charge on each instalment in default for
a period of not less than ten days in an amount not  in  excess  of  the
rate  provided  for  in  the  contract  or obligation on such instalment
provided that only one such delinquency and  collection  charge  may  be
collected  on  any such instalment regardless of the period during which
it remains in default.
6-a. A provision in a contract or obligation which  provides  for  the
payment  of attorney's fees or the costs of attorney's services incurred
in a legal action or proceeding for collection shall be null and void.
6-b. A provision in a contract or obligation which provides for waiver
of the right to impose any counterclaim  or  offset  arising  out  of  a
breach  of  that  contract or obligation by the seller shall be void and
unenforceable.
7. All of the terms of an obligation need not be contained in a single
document but if they are not then there shall be  an  original  document
executed  by  the  parties containing provisions making it applicable to
purchases of goods or services, which may not exceed a cash  sale  price
of  one hundred seventy-five dollars on each purchase, to be made by the
buyer from time to time from a retail seller, which  document,  together
with  other  written  statements  relating  to the sale of such goods or
services shall constitute  a  retail  instalment  obligation  and  shall
contain the entire agreement of the parties. In such cases, the original
document  shall  contain those 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
and shall further contain:
(i) a legend as provided in paragraph (a) of subdivision two hereof,
(ii) a notice to the buyer as provided in paragraph (b) of subdivision
two hereof,
(iii) the names of the seller and the buyer,
(iv) the place of business of the seller and the residence or place of
business of the buyer as specified by the buyer,
(v) the number of instalment payments, and
(vi)  the  amount  or  rate of the credit service charge applicable to
purchases thereunder.
At the time of each purchase under such  document,  the  seller  shall
give  the  buyer  statements  which  shall  contain at the top thereof a
legend in at least eight-point bold type: PART OF  A  RETAIL  INSTALMENT
OBLIGATION  and  an  adequate  description of the goods, accessories and
services sold or furnished (including the make and model, if any, in the
case of goods customarily sold by make  and  model)  and  shall  further
contain  those  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. If the seller does
not  deliver  to  the  buyer  at  the  time  of each purchase under such
original document a statement in compliance with  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, the  seller  shall
promptly  thereafter,  and in any event within ten days from the date of
such purchase, deliver, mail or cause to be mailed to the buyer  at  his
address shown on the seller's records, such statement. Unless the seller
does  so,  the  buyer  shall  have an unconditional right to cancel such
purchase and to receive an immediate refund of  any  payments  made  and
re-delivery  of  all  goods  traded in to the seller on account of or in
contemplation of such purchase; upon the written request  of  the  buyer
the  seller  shall  prove  the  accuracy  of  the  calculations  in such
statement.
Such statement with respect to the first such purchase shall, combined
with the original document, constitute the obligation for such purchase;
and, on each succeeding purchase pursuant to such original document, the
obligation therefor as represented by such original  document  and  such
statement  shall  constitute  a subsequent obligation under section four
hundred ten.