2023 Pennsylvania Consolidated & Unconsolidated Statutes › Title 12 - COMMERCE AND TRADE › Chapter 63 - Goods and Services Installment Sales › Section 6302 - Definitions

§ 6302. Definitions.
The following words and phrases when used in this chapter shall have the meanings given to them in this section unless the context clearly indicates otherwise:
"Actuarial method."
The method of allocating payments made on a debt between the amount financed and the finance charge at the interest rate stated in the closed-end credit agreement, as defined in Regulation Z, adopted under the Truth in Lending Act (Public Law 90-321, 15 U.S.C. § 1601 et seq.).
"Buyer."
A person who buys goods or obtains services from a seller in a sale, if the acquisition is not principally for the purpose of resale.
"Closed-end credit agreement."
Either of the following:
(1) A contract for a sale between a buyer and seller in which the buyer promises to pay in installments the outstanding balance incurred in the sale, whether or not the contract contains a security interest, and which contains either of the following:
(i) A finance charge, which is computed and added to the unpaid balance.
(ii) A provision specifying that, if the buyer had not contracted to pay in installments, the buyer could have received the goods or services at a lesser price or additional or higher quality goods or services at no added cost.
(2) A contract for a sale between a buyer and seller that includes a security agreement or a contract for the bailment or leasing of goods in which both of the following occur:
(i) The consideration that the bailee or lessee contracts to pay as compensation for the use of the goods is a sum substantially equivalent to or in excess of their value and is an obligation for the term of the lease that is not subject to termination by the bailee or lessee.
(ii) The bailee or lessee agrees to become or has the option of becoming the owner of the goods for no or nominal additional consideration upon full compliance with the terms of the contract.
"Finance charge."
(1) The amount, regardless of how expressed, that a buyer contracts to pay or pays for the privilege of purchasing goods or services to be paid in installments.
(2) Includes all charges incident to investigating and making a closed-end credit agreement or an open-end credit agreement and for the extension of the credit under that agreement.
(3) Excludes the following:
(i) Amounts charged for insurance premiums under section 6342 (relating to insurance).
(ii) Late fees under section 6343 (relating to late fees).
(iii) The costs of collection under section 6344 (relating to costs of collection).
(iv) Costs from nonaffiliated entities under section 6346 (relating to costs from nonaffiliated entity).
(v) Extension and deferment charges under section 6347 (relating to extension and deferment).
(vi) Attorney fees.
(vii) Court costs.
(viii) Official fees.
"Financing agency." A person, including a financial institution, engaged in this Commonwealth in whole or in part in the business of purchasing closed-end credit agreements or open-end credit agreements from at least one seller.
"Goods."
(1) Personal property bought primarily for personal, family or household use.
(2) The term includes the following:
(i) Certificates, coupons or gift cards exchangeable for goods.
(ii) Electronic media items.
(iii) Items purchased through the Internet.
(3) The term excludes the following:
(i) Goods covered under the act of August 14, 1963 (P.L.1082, No.464), known as the Home Improvement Finance Act.
(ii) A motor vehicle covered under Chapter 62 (relating to motor vehicle sales finance).
(iii) A security covered under the act of December 5, 1972 (P.L.1280, No.284), known as the Pennsylvania Securities Act of 1972.
"Holder."
(1) Either of the following:
(i) A seller who acquires a closed-end credit agreement or an open-end credit agreement that is executed, incurred or entered into by a buyer.
(ii) A financing agency or other assignee that purchases the agreement under subparagraph (i).
(2) Excludes a pledgee or holder of a security interest in an aggregate number of agreements to secure a bona fide loan on them.
"Official fees." The fees required by law and actually to be paid to the appropriate public officer to perfect a lien or other security interest that is retained or taken by a seller under a closed-end credit agreement or an open-end credit agreement.
"Open-end credit agreement." A contract:
(1) in which a buyer promises to pay in installments to a seller or financing agency the outstanding balance incurred in a sale, whether or not the seller retains a security interest in the goods sold; and
(2) that provides for a finance charge expressed as a percent of the periodic balances to accrue thereafter, if the charge is not capitalized or stated as a dollar amount in the contract.
"Purchase price." The price of goods sold or services furnished, which may include applicable taxes, as specified in a closed-end credit agreement or an open-end credit agreement.
"Sale." The sale of goods or furnishing of services by a seller to a buyer for a time sale price payable in installments.
"Seller." A person engaged in the business of selling goods or furnishing services to a buyer.
"Service contract." A written contract, optional on the part of a buyer, to perform over a fixed period of time or for a specified duration services regarding the maintenance or repair of goods.
"Services."
(1) Work, labor and services for other than a commercial or business use.
(2) The term includes the following:
(i) Services furnished in connection with the purchase or repair of goods or the repair of motor vehicles.
(ii) A service contract.
(iii) Services purchased through the Internet.
(3) The term excludes the following:
(i) Services covered under the act of August 14, 1963 (P.L.1082, No.464), known as the Home Improvement Finance Act.
(ii) A service contract or warranty covered under Chapter 62 (relating to motor vehicle sales finance).
(iii) Services for which the tariffs, rates, charges, costs or expenses, including in each instance the time sale price, are required by law to be filed with or approved by any of the following:
(A) The Commonwealth.
(B) The Federal Government.
(C) An official department, commission or agency of the Commonwealth or the United States.
"Time balance." The total of the unpaid balance and the amount of the finance charge.
"Time sale price." The total of the purchase price and the amounts included for insurance, official fees and finance charge.
"Unpaid balance." The purchase price and the amounts included for insurance and official fees, less the amount of a buyer's down payment in money or goods.
"Warranty."
(1) Either of the following, which becomes part of the basis of the bargain between a buyer and seller for purposes other than resale:
(i) A written affirmation of fact or written promise made in connection with the sale of goods by a seller or manufacturer to a buyer that relates to the nature of the material or workmanship and affirms or promises that the material or workmanship is free of defects or will meet a specified level of performance over a specified period of time.
(ii) Any undertaking in writing in connection with the sale of goods by a seller or manufacturer to refund, repair, replace or take other remedial action with respect to the goods if the goods fail to meet the specifications set forth in the undertaking.
(2) Excludes a service contract and an extended warranty with the characteristics of a service contract.
Cross References.
Section 6302 is referred to in section 6902 of Title 42 (Judiciary and Judicial Procedure).