§ 2355. Requirements and prohibitions as to retail installment contracts

(a) Each retail installment contract shall be in writing, dated, signed by both the buyer and the seller, and completed as to all essential provisions before it is signed by the buyer. A retail installment contract need not be contained in a single document.

(b) The printed portion of the retail installment contract, other than instructions for completion, shall be in a size equal to at least eight-point type. The contract shall contain substantially the following notice in a size equal to at least 10-point bold type and shall appear directly above the buyer’s signature:

“NOTICE TO RETAIL BUYER

Do not sign this contract in blank. You are
entitled to a copy of the contract at the time you sign.
Keep it to protect your legal rights.”

(c) A retail installment contract shall also contain, in a size equal to at least 10-point bold type, a specific statement that liability insurance coverage for bodily injury and property damage caused to others is not included, if that is the case.

(d) The seller shall deliver to the buyer at the time of the execution of the contract, and if it contains blank spaces as provided in subsection (j) of this section, mail to him or her at his or her address shown on the retail installment contract a copy of the contract as accepted by the seller. Until the seller does so, a buyer who has not received delivery of the motor vehicle may rescind his or her contract and receive a refund of all payments made and a return of all goods traded in to the seller on account of or in contemplation of the contract or, if the goods traded in cannot be returned, the value thereof. Any acknowledgment by the buyer of delivery of a copy of the retail installment contract shall be in a size equal to at least 10-point bold type and shall appear directly above the buyer’s signature.

(e) The retail installment contract shall contain the names of the seller and the buyer, the place of business of the seller, the residence or other address of the buyer as specified by the buyer, and a description of the motor vehicle sold or to be sold.

(f)(1) The retail installment contract shall contain the following items:

(A) The cash price of the motor vehicle.

(B) The amount of the buyer’s down payment, if any, specifying the amounts paid in money and in goods traded in.

(C) The difference between items (A) and (B) of this subdivision.

(D) The amount, if any, paid or to be paid by the seller pursuant to an agreement with the buyer to discharge a security interest, lien interest, or lease interest on the traded-in motor vehicle; the amount, if any, for insurance, including the cost of credit life insurance at a rate authorized by rate schedules then in effect and on file with the Commissioner of Financial Regulation; the cost, if any, of physical damage insurance specifying the type or types and the term of coverage; the cost, if any, for service contracts as defined in 8 V.S.A. § 4247; and the reasonable cost, if any, for a debt protection agreement as set forth in 8 V.S.A. § 10405.

(E) The amount of all official fees, and a separate identified charge shall be shown therefor.

(F) The principal balance, which is the sum of items (C), (D), and (E) of this subsection.

(G) The amount of the finance charge.

(H) The sum of items (F) and (G) of this subsection, which is the balance to be paid by the buyer to the seller; the number of installments; the amount of each installment and the due date or period thereof; and notice to the borrower as to the effect of early or late payments.

(I) The total time price, which is the sum of items (A), (D), (E), and (G) of this subsection.

(J) A disclosure form completed by the automobile dealership containing at least the allowance for the trade-in, amount owed on the trade-in or lease, cash price, amount financed on the motor vehicle retail installment contract, the amount financed on the motor vehicle retail installment contract as a percentage of the cash price of the vehicle, and signature blocks for the buyer will be provided to the buyer who finances a motor vehicle utilizing a motor vehicle retail installment sales contract at the dealership. The unexecuted disclosure form will be provided to the buyer prior to consummation of the transaction and will be signed by the buyer at the time the buyer signs the motor vehicle retail installment contract. The disclosure will be on a form prescribed by the Commissioner on or before July 1, 2006 and as thereafter amended by the Commissioner by rule.

(2) The items specified in subdivision (1) of this subsection need not be stated in the sequence or order set forth; additional items may be included but only to explain the calculations involved in determining the balance to be paid by the buyer as set forth in this subsection. No other charges shall be made by the seller.

(g) The amount, if any, stated and included in the retail installment contract for insurance to be purchased by the holder shall not exceed the applicable premiums chargeable in accordance with filings, if any, with the Department of Financial Regulation. If the insurance for which the stated amount is included insures the life, safety, or health of the buyer, or their interest in or their liability because of the motor vehicle, and is purchased by the holder, the holder shall, within 30 days after the execution of the retail installment contract, send or cause to be sent to the buyer a policy or policies of insurance, written by an insurance company authorized to do business in this State, or a certificate or certificates thereof. The policy or policies shall set forth all the terms, exceptions, limitations, restrictions, and conditions of the contract or contracts of insurance and the certificates shall set forth a summary thereof. The insurance may be purchased by the holder. However, the buyer may purchase the insurance from an agent or broker of his or her own selection and select an insurance company acceptable to the holder, which acceptance shall not be arbitrarily or unreasonably withheld, but in that case the inclusion of the insurance premium in the retail installment contract shall be optional with the seller. If the insurance is cancelled or the premium adjusted, any refund of the premium received by the holder shall be credited to the outstanding principal balance of the contract, except to the extent applied toward payment for similar insurance protecting the interest of the buyer and the holder or either of them.

(h)-(i) [Repealed.]

(j) A retail installment contract shall not be signed by any party thereto when it contains blank spaces of items that are pertinent to the transaction and that should be completed. However, if delivery of the motor vehicle is not made at the time of the execution of the contract, the identifying numbers or marks or similar information and the due date of the first installment may be inserted in the contract after its execution.

(k) Upon written request of the buyer, the holder of a retail installment contract shall give or forward to the buyer a written statement of the dates and amounts of installment payments and the total amount unpaid under the contract. A buyer shall be given a written receipt for any payment when made in cash. One statement or receipt shall be given the buyer without charge; if any additional statement or receipt is requested by the buyer, it shall be supplied by the holder at a charge not in excess of $1.00 for each additional statement or receipt so supplied.

(l) A provision in a retail installment contract relieving the seller from liability for any legal remedies that the buyer may have against the seller shall not be enforceable.

(m) The holder of any retail installment contract may collect a reasonable delinquency charge if provided for in the contract. In addition, where collection is referred for payment to an attorney who is not a salaried employee of the holder of the contract, the contract may provide for the payment of an attorney’s reasonable fee and for court costs and disbursements and also for actual and reasonable out-of-pocket expenses incurred after referral in connection with the delinquency, repossession, or foreclosure, including storage charges, reconditioning expenses, and collection expenses. (Added 1961, No. 227, § 5, eff. Jan. 1, 1962; amended 1979, No. 173 (Adj. Sess.), § 19; 1985, No. 59, § 3; 1989, No. 122, §§ 4, 5, 6, eff. June 30, 1989; 1989, No. 225 (Adj. Sess.), § 25; 1995, No. 180 (Adj. Sess.), § 38; 1997, No. 109 (Adj. Sess.), § 4, eff. Sept. 1, 1998; 2005, No. 70, § 5; 2005, No. 143 (Adj. Sess.), § 1; 2021, No. 20, § 11.)