Montana Code 30-14-2206. Cancellation
30-14-2206. Cancellation. (1) Guaranteed asset protection waiver agreements may be cancelable or noncancelable after the free look period. GAP waivers must provide that if a borrower cancels a GAP waiver within the free look period, so long as no benefits have been provided, the borrower is entitled to a full refund of the purchase price.
Terms Used In Montana Code 30-14-2206
- Administrator: means a person, other than an insurer or creditor, that performs administrative or operational functions pursuant to guaranteed asset protection waiver programs. See Montana Code 30-14-2202
- Borrower: means a debtor, retail buyer, or lessee under a finance agreement. See Montana Code 30-14-2202
- Creditor: means :
(a)the lender in a loan or credit transaction;
(b)the lessor in a lease transaction;
(c)a retail dealer of motor vehicles that provides credit to buyers as part of a retail sale, provided that the dealer complies with the provisions of this part;
(d)the seller in commercial retail installment transactions; or
(e)the assignees of any of the persons set out in subsections (3)(a) through (3)(d) to whom the credit obligation is payable. See Montana Code 30-14-2202
- Finance agreement: means a loan, lease, or retail installment sales contract for the purchase or lease of a motor vehicle. See Montana Code 30-14-2202
- Free look period: means the period of time from the effective date of the guaranteed asset protection waiver until the date the borrower may cancel the contract without penalty, fees, or costs to the borrower. See Montana Code 30-14-2202
- GAP waiver: means a contractual agreement that is part of or a separate addendum to the finance agreement in which a creditor agrees for a separate charge to cancel or waive all or part of amounts due on a borrower's finance agreement in the event of a total physical damage loss or unrecovered theft of a motor vehicle. See Montana Code 30-14-2202
- Motor vehicle: means a self-propelled or towed vehicle designed for personal or commercial use, including but not limited to an automobile, truck, motorcycle, recreational vehicle, all-terrain vehicle, snowmobile, camper, boat, and personal watercraft and a trailer used to transport a motorcycle, boat, camper, or personal watercraft. See Montana Code 30-14-2202
(2)If the borrower cancels the GAP waiver or terminates the finance agreement early but after the agreement has been in effect beyond the free look period, the borrower is entitled to a refund of any unearned portion of the purchase price of the GAP waiver unless the GAP waiver provides otherwise. In order to receive a refund, the borrower, in accordance with any applicable terms of the waiver, shall provide a written request to the creditor, administrator, or other party. If the borrower is canceling the GAP waiver due to the early termination of the finance agreement, the borrower shall provide a written request within 90 days of the event terminating the finance agreement.
(3)If the cancellation of a GAP waiver occurs as a result of a default under the finance agreement, the repossession of the motor vehicle associated with the finance agreement, or other termination of the finance agreement, any refund due may be paid directly to the creditor or administrator and applied as set forth in subsection (4).
(4)A cancellation or termination refund under subsection (1), (2), or (3) may be applied by the creditor as a reduction of the amount owed under the finance agreement unless the borrower can show that the finance agreement has been paid in full.