Michigan Laws 445.956 – Prohibited provisions in rental-purchase agreement
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A rental-purchase agreement shall not contain a provision requiring any of the following:
(a) A garnishment of wages or a power of attorney to confess a judgment.
Terms Used In Michigan Laws 445.956
- Counterclaim: A claim that a defendant makes against a plaintiff.
- Garnishment: Generally, garnishment is a court proceeding in which a creditor asks a court to order a third party who owes money to the debtor or otherwise holds assets belonging to the debtor to turn over to the creditor any of the debtor
- Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
- Lessee: means a person who leases property pursuant to a rental-purchase agreement. See Michigan Laws 445.952
- Lessor: means a person who, in the ordinary course of business, regularly leases, offers to lease, or arranges for the leasing of property under a rental-purchase agreement. See Michigan Laws 445.952
- person: may extend and be applied to bodies politic and corporate, as well as to individuals. See Michigan Laws 8.3l
- Power of attorney: A written instrument which authorizes one person to act as another's agent or attorney. The power of attorney may be for a definite, specific act, or it may be general in nature. The terms of the written power of attorney may specify when it will expire. If not, the power of attorney usually expires when the person granting it dies. Source: OCC
- Rental-purchase agreement: means an agreement for the use of personal property by a lessee primarily for personal, family, or household purposes, for an initial period of 4 months or less that is automatically renewable with each payment after the initial period and that permits the lessee to become the owner of the property. See Michigan Laws 445.952
(b) Authorization to the lessor or a person acting on the lessor’s behalf to unlawfully enter upon the lessee‘s premises or to commit any breach of the peace in the repossession of goods.
(c) The lessee to waive any defense, counterclaim, or right of action against the lessor or a person acting on the lessor’s behalf, as the lessee’s agent in collection of payments under the lease or in the repossession of goods.
(d) The lessee to agree not to assert against the lessor or against an assignee a claim or defense arising out of the lease.
(e) A requirement for any collection or repossession charges in excess of those allowable under section 7(e) and applicable court rules.