State Legislative Issues Compliance Points
05/06/2008 - South Carolina Increases Its Delinquency Charge
The South Carolina Department of Consumer Affairs has issued its biennial dollar amount adjustments under the South Carolina Consumer Protection Code. Among other things, the amount that may be charged for a delinquency fee (or late charge) has increased from $15.50 to $16.50. Additionally, the minimum delinquency charge has been increased from $6.20 to $6.60.
Documents affected: This new law will affect the Wolters Kluwer Financial Services retail contracts for South Carolina that include a full description of the late charge:
RSSIMVLF-SC
RSSIMVLFA-SC
RSSIGSLF-SC
RSSIGSLFA-SC
The above also includes electronic versions of the documents.
Effective date: July 1, 2008.
04/04/2008 - Indiana Increases Its Delinquency Charge
The Indiana Department of Financial Institutions has issued its biennial dollar amount adjustments under the Indiana Uniform Consumer Credit Code. Among other things, the dollar limit on a delinquency charge has increased from $17.00 to $17.50.
Documents affected: This new law will affect the WKFS forms for Indiana that include a full description of the late charge:
- RSSIMVLF-IN
- RSSIMVLFA-IN
- RSSIGSLF-IN
- RSSIGSLFA-IN
plus electronic versions.
The effective date for this change is July 1, 2008.
02/21/2008 - DC Creates Disclosure Requirements for Arbitration Agreements
A new law in the District of Columbia will require the disclosure of certain costs associated with an arbitration agreement for a consumer purpose transaction.
The following information must be disclosed:
- The filing fee;
- The average daily cost for an arbitrator and hearing room if the consumer elects to appear in person;
- Other charges that the arbitrator or arbitration organization will assess in conjunction with an arbitration where the consumer appears in person; and
- The proportion of these costs which each party bears in the event that the consumer prevails, and in the event that the consumer does not prevail.
Documents affected: This new law will affect the WKFS documents that contain an arbitration agreement: RSSIMVLFA-DC, RSSIMVLFAZDC, RSSIGSLFA-DC, RSSIGSLFAZDC, MVL-CE-DC
Effective date: March 4, 2008.
State Legislative Issues Compliance Points
10/23/2007 - CA Amends Contract Cancellation Option Agreement
California Assembly 305 was signed into law on September 21, 2007. Existing Cal Vehicle Code 11713.21 requires that a dealer offer a contract cancellation option agreement to the consumer-purpose buyer of any used vehicle under $40,000, except motorcycles and recreational vehicles. That statute prescribes provisions of the agreement, including a statement about the restocking fee. The statute prescribes the maximum restocking fee for vehicles in various price ranges. The bill amends this last provision with respect to purchases by a lessee by adding to the existing statutory maximum the amount of any lease termination fee that the lessee would have had to pay but for the purchase, including amounts for excess mileage, unrepaired damage, and excess wear and tear. The bill also requires that the agreement for such a lessee include a statement that the maximum fee is increased because of those charges.
Documents affected: CONCAN-CA
Effective date: January 1, 2008.
10/15/2007 - Indiana Amends the Dishonored Check Amount
Indiana has passed House Bill 1557 which amends Ind. Code § 24-4.5-2-202. This law deals with returned check fee amounts. The amount that a seller may contract for in a consumer credit sale for a dishonored check, negotiable order of withdrawal, or share draft has been increased from $20 to $25.
Documents affected: All retail installment contracts.
Effective date: July 1, 2007.
10/15/2007 - Illinois Amends Documentary Fee Notice
Illinois has changed the language of the Documentary Fee notice that appears on retail installment contracts for motor vehicles. This change is found in House Bill 1657 and is now in the Illinois statutes at 815 ILCS 375/11.1.
The old notice had this sentence: “THE BASE DOCUMENTARY FEE BEGINNING JANUARY 1, 1992, WAS $40. THE MAXIMUM AMOUNT THAT MAY BE CHARGED FOR A DOCUMENTARY FEE IS THE BASE DOCUMENTARY FEE OF $40 WHICH SHALL BE SUBJECT TO AN ANNUAL RATE ADJUSTMENT EQUAL TO THE PERCENTAGE OF CHANGE IN THE BUREAU OF LABOR STATISTICS CONSUMER PRICE INDEX."
The new notice reads as follows: “THE BASE DOCUMENTARY FEE BEGINNING JANUARY 1, 2008, WAS $150. THE MAXIMUM AMOUNT THAT MAY BE CHARGED FOR A DOCUMENTARY FEE IS THE BASE DOCUMENTARY FEE OF $150 WHICH SHALL BE SUBJECT TO AN ANNUAL RATE ADJUSTMENT EQUAL TO THE PERCENTAGE OF CHANGE IN THE BUREAU OF LABOR STATISTICS CONSUMER PRICE INDEX.”
Documents Affected: All motor vehicle contracts
Effective date: January 1, 2008.
09/25/2007 - Oklahoma Dept of Consumer Credit Changes the UCCC Dollar Amounts
The Oklahoma Department of Consumer Credit has announced biennial changes to the dollar amounts found in Oklahoma’s Uniform Consumer Credit Code. The change is effective July 1, 2007. Among the changes included is an increase in the late charge on retail installment contracts from $20.50 to $21.00. This change affects both motor vehicle contracts and good and services contracts.
Documents affected: All retail installment contracts that include preprinted late charge language.
Paper: RSSIMVLF-OK; RSSIMVLFA-OK; RSSIGSLF-OK; RSSIGSLFA-OK
Eforms: RSSIMVLFLZ-OK; RSSIMVLFAZ-OK; RSSIGSLFLZ-OK; RSSIGSLFAZ-OK
Eforms (e-sign version): RSSIMVLFZEOK; RSSIMVLFAEOK
09/18/2007 - Rhode Island Passes H5800
Effective after January 1, 2008, any contract to finance the sale of a motor vehicle in Rhode Island must prominently display the term and the rate of interest under the new law, found at R.I. Pub. Laws § 6-13.1-28. The buyer’s initials or signature must appear adjacent to this information as an acknowledgment. Any contract that does not comply with this requirement will be voidable within 30 days at the option of the buyer.
Documents affected: All motor vehicle retail installment contracts.
09/18/2007 - Rhode Island Enacts the Rhode Island Automobile Repossession Act
This new law can be found at R.I. Pub. Laws § 6-50-1. The general assembly of Rhode Island finds and declares that Rhode Island consumers who have purchased, through an extension of credit, or leased an automobile may fall behind on payments during difficult economic or emotional times and should be allowed to cure a default on the loan or lease within the time provided by this new law. The law limits the conditions under which a default on the transaction may be declared. It also establishes notice and cure requirements before the creditor can accelerate the debt and repossess the automobile.
Effective date: July 6, 2007
09/18/2007 - Minnesota Passes Car Buyer’s Bill of Rights
This year Minnesota considered a Car Buyer’s Bill of Rights. The law regulated the sale of “certified” used motor vehicles and adds two disclosure requirements that apply motor vehicle transactions.
The first new disclosure requires a seller to provide to the buyer a written disclosure that sets forth the description and charge for each item sold in connection with a retail installment contract. The buyer must sign this disclosure. The seller must provide this disclosure prior to the execution of the retail installment contract. The disclousre must be in at least 10-point type, and in a document that is separate from the retail installment contract and any other vehicle purchase documents. The new law can be found at Minn. Stat. §53C.08.
The second new disclosure requires a seller to provide to the buyer a written notice whenever a consumer report has been obtained in connection with an application for credit initiated by a buyer for the purchase or lease of a motor vehicle. The disclosure provides information on how the consumer report is used and who the buyer should contact if he or she has questions about the report. The seller must provide this disclosure prior to the execution of the contract. The disclosure must be in at least 10-point boldface type, and in a document that is separate from the retail installment contract or lease agreement. The new law can be found at Minn. Stat. §53C.083.
Documents created: ADD-PROD-MN, CRN-MN
Effective date: January 1, 2008.
09/14/2007 - Arkansas House Bill 1718 Signed into Law
The governor of Arkansas signed House Bill 1718 into law on March 19, 2007. The bill amended the Motor Vehicle Consumer Protection Act regarding fees charged for handling and processing the sale of a new or used motor vehicle. The ability to charge a "documentary fee" has been repealed, while a new "service and handling fee" has been authorized. New disclosure language about the "service and handling fee" is now required. The amount of the "service and handling fee" may not exceed $129.00 and must be charged uniformly to all retail customers.
If a motor vehicle dealer wishes to charge the new "service and handling fee," it will need to make sure to use retail contracts that have been updated for this 2007 change.
If a motor vehicle dealer charges the "service and handling fee," it must also display a 8" by 10" poster in the area in which the sales document processes are conducted. The poster must disclosed that the dealership charges a "service and handling fee," the amount of the fee, and a required notice. This required notice must be in a common font and at least 55 point size.
More details about this change can be found in the statute and in regulations from the Arkansas Motor Vehicle Commission.
09/14/2007 - Texas Office of Consumer Credit Commissioner Amends Consumer Notice
Texas 7 TAC 86.101 was adopted by the Office of Consumer Credit Commissioner on 10/20/2006 and is effective 10/1/2007. The regulation made changes to the content of the Consumer Notification by removing the the direct phone number and replacing it with the web address. The notice will read as:
“To contact the holder of your Contract about this account call the number appearing with the Assignee's name in the ASSIGNMENT section. If no Assignee is listed, contact the Seller, whose number appears at the top of page 1. This contract is subject in whole or in part to Texas law which is enforced by the Consumer Credit Commissioner, 2601 North Lamar Boulevard, Austin Texas 78705-4207; (800) 538-1579; www.occc.state.tx.us. Contact the commissioner relative to any inquiries or complaints."
Documents affected: All retail installment contracts.
09/14/2007 - Mississippi MV Commission published Regulation 8
The Mississippi Motor Vehicle Commission has implemented a new regulation, effective August 1, 2007. Regulation 8 allows for documentary/service fees to be charged by a motor vehicle dealer for services rendered to, for, or on behalf of a purchaser in preparing, handling, and processing documents relating to the sale or lease of a motor vehicle. The regulation also establishes a new required notice regarding the documentary/service fee.
Documents affected: All motor vehicle retail installment contracts.
09/10/2007 - Georgia H.B. 240 Signed into Law
Georgia House Bill 240 (Ga. Code Ann. § 10-1-7(a)) increased the late fee allowed on retail installment contracts for goods and services, from $18 to $25, effective July 1, 2007.
Documents affected: All goods and services retail installment contracts that include preprinted late charge language. Paper: RSSIGSLF-GA and RSSIGSLFA-GA. Eforms: RSSIGSLFLZ-GA and RSSIGSLFAZ-GA.
