2023 New York Laws › PEP - Personal Property › Article 9 - 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. (a) 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.
(b)  Limitations on assignee liability referred to in paragraph (a) of
this  subdivision  shall  be  exclusive  of  any  reasonable  costs  and
attorney's fees the court may award.
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.