PRINTER'S NO. 3652
No. 2591 Session of 2000
INTRODUCED BY ALLEN, M. COHEN, ZUG, ARGALL, BAKER, BATTISTO,
BELFANTI, CLARK, CLYMER, L. I. COHEN, GEIST, HALUSKA,
HENNESSEY, HESS, HORSEY, McILHATTAN, STERN, E. Z. TAYLOR,
THOMAS AND WILT, JUNE 6, 2000
REFERRED TO COMMITTEE ON COMMERCE AND ECONOMIC DEVELOPMENT,
JUNE 6, 2000
AN ACT
1 Amending the act of June 28, 1947 (P.L.1110, No.476), entitled
2 "An act defining and regulating certain installment sales of
3 motor vehicles; prescribing the conditions under which such
4 sales may be made and regulating the financing thereof;
5 regulating and licensing persons engaged in the business of
6 making or financing such sales; prescribing the form,
7 contents and effect of instruments used in connection with
8 such sales and the financing thereof; prescribing certain
9 rights and obligations of buyers, sellers, persons financing
10 such sales and others; limiting incidental charges in
11 connection with such instruments and fixing maximum interest
12 rates for delinquencies, extensions and loans; regulating
13 insurance in connection with such sales; regulating
14 repossessions, redemptions, resales and deficiency judgments
15 and the rights of parties with respect thereto; authorizing
16 extensions, loans and forbearances related to such sales;
17 authorizing investigations and examinations of persons
18 engaged in the business of making or financing such sales;
19 prescribing penalties and repealing certain acts," further
20 defining "principal amount financed"; further providing for
21 assessment of costs of examination, for contents of contract,
22 for other costs included in amount financed, for redemption
23 and termination of contract after repossession, for
24 prohibited charges and for penalties; providing for
25 regulations; and making editorial changes.
26 The General Assembly of the Commonwealth of Pennsylvania
27 hereby enacts as follows:
28 Section 1. Clauses 13 and 18 of section 3 of the act of June
1 28, 1947 (P.L.1110, No.476), known as the Motor Vehicle Sales
2 Finance Act, are amended and the section is amended by adding
3 clauses to read:
4 Section 3. Definitions.--The following words, terms and
5 phrases when used in this act shall have the meaning ascribed to
6 them in this section, except where the context clearly indicates
7 otherwise:--
8 * * *
9 13. "Principal amount financed" shall mean the unpaid cash
10 price balance after deducting the down payment, adding the cost
11 of any insurance premiums required or obtained as security for
12 or by reason of the sale of a motor vehicle under an installment
13 sale contract, and adding other costs or charges necessary or
14 incidental to the sale of the motor vehicle under such contract,
15 which the seller contracts to retain or receive or to pay on
16 behalf of the buyer, and [for the] any other amount [of] for
17 which the seller agrees to extend credit to the buyer, and for
18 which the buyer contracts voluntarily. Such costs or charges may
19 include, but are not limited to, charges for insurance, service
20 contracts, warranties, costs described in section 14 or 18 of
21 this act, and amounts representing payment of a prior credit or
22 lease balance to discharge a security interest, lien or lease
23 interest on property traded in or returned.
24 * * *
25 [18. "Administrator" shall mean the Department of Banking of
26 the Commonwealth of Pennsylvania.]
27 * * *
28 23. "Department" shall mean the Department of Banking of the
29 Commonwealth.
30 24. "Secretary" shall mean the Secretary of Banking.
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1 Section 2. Sections 4, 5, 6, subsection E of section 7 and
2 sections 8 and 9 of the act are amended to read:
3 Section 4. Licenses Required.--On and after the effective
4 date of this act no person shall engage or continue to engage in
5 this Commonwealth either as principal, employe, agent or broker;
6 1. In the business of an installment seller of motor
7 vehicles under installment sale contracts, except as authorized
8 in this act, under license issued by the [administrator]
9 department, or
10 2. In the business of a sales finance company, except as
11 authorized in this act, under license issued by the
12 [administrator] department, or
13 3. In the business of a collector-repossessor, except as
14 authorized in this act, under license issued by the
15 [administrator] department.
16 Section 5. Applications for Licenses.--
17 A. Applications for licenses under this act shall be in
18 writing, under oath, and in the form prescribed by the
19 [administrator] department.
20 B. The application shall contain the name under which the
21 business is conducted, the address of the place of business, the
22 date of registration of the fictitious or trade name, if any,
23 with the Secretary of the Commonwealth; the date and place of
24 incorporation, if the applicant is a corporation; the name and
25 residence address of the owner, if the applicant is an
26 individual owner; the name and residence address of all owners,
27 partners or members, if the applicant is a partnership or
28 association; the name and address of all officers and directors,
29 if the applicant is a corporation, and such other information as
30 the [administrator] department may require.
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1 C. All applications filed by associations or corporations
2 shall be accompanied by a power of attorney showing the name and
3 address of the authorized agent in the Commonwealth of
4 Pennsylvania upon whom all judicial and other process or legal
5 notice may be served, and in the case of the death, removal from
6 the Commonwealth or any legal disability or disqualification of
7 such agent, service of such process or notice upon the
8 [administrator] department shall be authorized.
9 D. A separate application, on the prescribed form, shall be
10 filed for each place of business conducted by or to be
11 established by a licensee within the Commonwealth of
12 Pennsylvania.
13 E. All applications for renewal licenses shall be filed at
14 least fifteen (15) days prior to October first, annually.
15 Section 6. License; Bonds.--
16 A. A bond, in the form prescribed by the [administrator]
17 department, in the penal sum of five thousand dollars ($5,000),
18 shall accompany every application for license as a sales finance
19 company and for license as a collector-repossessor. Such bond
20 shall be executed by a surety company authorized by the laws of
21 Pennsylvania to transact business within this Commonwealth:
22 Provided, That the bond accompanying an application for license
23 as a sales finance company, filed by a banking institution
24 located within this Commonwealth, may be executed by such
25 banking institution on its own behalf, in lieu of a bond
26 executed by a surety company. The bond shall be executed to the
27 Commonwealth of Pennsylvania and shall be for the use of the
28 Commonwealth and for any person or persons. The condition of the
29 bond shall be that the licensee will comply with and abide by
30 all the provisions of this act, and all the rules and
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1 regulations of the [administrator] department lawfully issued,
2 and that the licensee will pay to the Commonwealth, to the
3 [administrator] department or to any person or persons, any and
4 all moneys that may become due to the Commonwealth, to the
5 [administrator] department or to any person or persons from the
6 said licensee under and by virtue of the provisions of this act.
7 If any person shall be aggrieved by the misconduct of a licensee
8 and shall recover judgment against such licensee, such person
9 may, on any execution issued under such judgment, maintain an
10 action upon the bond of the licensee in any court having
11 jurisdiction of the amount claimed, provided the [administrator]
12 department assents thereto.
13 B. A bond in the form prescribed shall be filed for each
14 place of business conducted by a finance company and for each
15 place of business conducted by a collector-repossessor within
16 the Commonwealth of Pennsylvania.
17 C. A new bond shall accompany every application for renewal
18 license and shall be filed at least fifteen (15) days prior to
19 October first, annually.
20 Section 7. License Fees.--
21 * * *
22 E. All license fees and fines received by the
23 [administrator] department under this act shall be deposited in
24 the State Treasury to the credit of a special fund for the use
25 of the [administrator] department in administering this and
26 other laws of the Commonwealth placed under [his] its
27 administration.
28 Section 8. Approval of Licenses and Issuance of Licenses.--
29 A. [The administrator, if he] If the department approves an
30 application for license, it shall issue to the applicant a
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1 license certificate showing the name of the person authorized to
2 do business thereunder and the address of the licensee. Such
3 license certificate when issued to an installment seller or to a
4 sales finance company shall be posted in a conspicuous place in
5 the place of business of the licensee, so that it will be in
6 full view of the public at all times; and when issued to a
7 collector-repossessor shall be carried in the immediate
8 possession of the licensee whenever he is engaged in the type of
9 business for which the license is issued, so that it may be
10 presented for inspection upon request of any person entitled to
11 such inspection.
12 B. A license shall not be transferred or assigned.
13 C. A licensee may change his place of business to another
14 location within the same municipality for which the license
15 certificate was issued. A licensee desiring to change the
16 address of his place of business shall give prior written notice
17 thereof to the [administrator] department and shall return the
18 license certificate to the [administrator] department for
19 amendment. The [administrator] department shall amend the
20 license certificate to show the new address and the date
21 thereof, which shall thereafter be the authorized address of the
22 licensee. A licensee shall not be required to pay any charge for
23 amendment of a license certificate to effect change of address.
24 D. Only one place of business may be operated under the same
25 license: Provided, however, That where every place of business
26 is conducted under one name and the business records are kept in
27 one place only one license shall be required. This proviso shall
28 apply only to installment sellers. A licensee may operate more
29 than one place of business by filing an application on the
30 prescribed form for each additional place of business and by
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1 furnishing a bond for each additional place of business in the
2 case of a sales finance company and collector-repossessor and by
3 paying the respective license fee provided in this act for each
4 additional place of business.
5 Section 9. Rejection of Application.--
6 A. The [administrator] department may reject any application
7 for license or any application for renewal of a license if [he]
8 it is not satisfied that the financial responsibility,
9 character, reputation, integrity and the general fitness of the
10 applicant and of the owners, partners or members thereof, if the
11 applicant be a partnership or association, and of the officers
12 and directors, if the applicant be a corporation, are such as to
13 command the confidence of the public and to warrant the belief
14 that the business for which application for license is filed
15 will be operated lawfully, honestly, fairly and within the
16 legislative intent of this act and in accordance with the
17 general laws of this Commonwealth: Provided, however, That no
18 license may be issued if the applicant, any affiliate, owner,
19 partner, member, officer, director, employe, agent or spouse of
20 the applicant has pleaded guilty, entered a plea of nolo
21 contendere, or has been found guilty by a judge or a jury for
22 engaging in any business for which a license is required under
23 this act without having obtained a license under this act, or if
24 the applicant, any affiliate, owner, partner, member, officer,
25 director, employe, agent or spouse of the applicant has pleaded
26 guilty, entered a plea of nolo contendere, or has been found
27 guilty by a judge or a jury of a second offense violation of
28 this act under the penal section of this act applicable to
29 licensees and had its license revoked.
30 C. Whenever the [administrator] department rejects an
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1 application for license, [he] it shall return the license fee
2 which accompanied the application: Provided, however, All or any
3 portion of the license fee may be retained by the
4 [administrator] department if rejection is based wholly or
5 partially upon false information furnished by the applicant in
6 the application.
7 Section 3. Section 10 of the act, amended December 17, 1982
8 (P.L.1389, No.318), is amended to read:
9 Section 10. Revocation or Suspension of Licenses.--
10 A. The [administrator] department, upon thirty (30) days'
11 written notice to the licensee, forwarded by registered mail to
12 the place of business of such licensee, as shown in the
13 application for license or as amended on the license certificate
14 in case of change of address subsequent to issuance of the
15 license certificate, may revoke or suspend any license if [he]
16 it finds that:
17 1. The licensee has made any material misstatement in the
18 application for license, or that
19 2. The licensee has violated any provision of this act, or
20 that
21 3. The licensee has violated any rule or regulation issued
22 by the [administrator] department under and within the authority
23 of this act, or that
24 4. The licensee has failed to comply with any demand, rule
25 or regulation lawfully made by the [administrator] department
26 under and within the authority of this act, or that
27 5. The licensee refuses or has refused to permit the
28 [administrator or his designated representative] department to
29 make examinations authorized by this act, or that
30 6. The licensee in the case of a finance company and
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1 collector-repossessor has failed to maintain in effect the bond
2 required under the provisions of this act, or that
3 7. The licensee has failed to maintain satisfactory records
4 required by this act or prescribed by the [administrator]
5 department, or that
6 8. The licensee has falsified any records required by this
7 act to be maintained of the business contemplated by this act,
8 or that
9 9. The licensee has failed to file any report with the
10 [administrator] department within the time stipulated in this
11 act, or that
12 10. The licensee has failed to pay the fine required by this
13 act for failure to file reports to the [administrator]
14 department within the time stipulated, or that
15 11. The licensee has defrauded any retail buyer to the
16 buyer's damage or wilfully failed to perform any written
17 agreement with any retail buyer, or that
18 12. Any fact or condition exists or is discovered which, if
19 it had existed or had been discovered at the time of filing of
20 the application for such license, would have warranted the
21 [administrator] department in refusing to issue such license.
22 13. The licensee has:
23 (i) failed to collect any tax or fee due the
24 Commonwealth upon any sale of a vehicle;
25 (ii) collected any such tax or fee and failed to issue a
26 true copy of the tax report to the purchaser, as required by
27 law;
28 (iii) issued a false or fraudulent tax report or copy
29 thereof; or
30 (iv) failed to pay any tax or fee over to the
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1 Commonwealth at the time and in the manner required by law.
2 B. The [administrator] department may revoke or suspend only
3 the particular license with respect to which grounds for
4 revocation may occur or exist, but if [he] the department finds
5 that grounds for revocation are of general application to all
6 places of business or to more than one place of business
7 operated by a licensee, [he] it may revoke all of the licenses
8 issued to such licensee or those licenses to which grounds for
9 revocation apply, as the case may be.
10 C. Whenever a license has been revoked, the [administrator]
11 department shall not issue another license to the licensee
12 pursuant to the provisions of this act until the expiration of
13 at least one (1) year from the effective date of revocation of
14 said license; and not at all, if such licensee or any owner,
15 partner, member, officer, director, employe, agent or spouse of
16 the licensee shall have pleaded guilty, entered a plea of nolo
17 contendere, or has been found guilty by a judge or a jury of a
18 second offense violation of this act.
19 D. Appeals may be taken from the action of the
20 [administrator] department in suspending and revoking licenses
21 in accordance with the procedure prescribed by [the act of June
22 4, 1945 (Pamphlet Laws 1388), known as "The Administrative
23 Agency Law."] 2 Pa.C.S. (relating to administrative law and
24 procedure).
25 Section 4. Section 11 of the act, repealed in part April 28,
26 1978 (P.L.202, No.53), is amended to read:
27 Section 11. Authority of [Administrator] Department.--
28 A. The [administrator and any person designated by him for
29 that purpose] department is empowered to investigate, at any
30 time, the business and affairs and examine the books, accounts,
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1 papers, records, documents and files of every licensee and of
2 every person who shall be engaged in business contemplated by
3 this act, whether such person shall act, or claim to act, as
4 principal, agent or broker or under or without the authority of
5 this act. For this purpose the [administrator] department shall
6 have free access to the offices and places of business, books,
7 accounts, papers, records, documents and files of all such
8 persons. A person who is not licensed under this act shall be
9 presumed to be engaged in business contemplated by this act, if
10 he, as principal, agent or broker advertises or solicits
11 business for which a license is required by the provisions of
12 this act, and the [administrator and any person designated by
13 him for that purpose] department is, in such cases, hereby
14 empowered to examine the books, accounts, papers, records,
15 documents, files, safes and vaults of such persons for the
16 purpose of discovering violations of this act.
17 B. The [administrator] department is empowered to require
18 the attendance and testimony of witnesses and the production of
19 any books, accounts, papers, records, documents and files
20 relating to such business which the [administrator] department
21 has authority by this act to investigate, and for this purpose
22 the [administrator] secretary or [his] a duly authorized
23 representative may sign subpoenas, administer oaths and
24 affirmations, examine witnesses and receive evidence. In case of
25 disobedience of any subpoena or the contumacy of any witness
26 appearing before the [administrator] department, the
27 [administrator] secretary may invoke the aid of the courts, and
28 such court shall thereupon issue an order requiring the person
29 subpoenaed to obey the subpoena, or to give evidence, or to
30 produce books, accounts, papers, records, documents and files
20000H2591B3652 - 11 -
1 relative to the matter in question. Any failure to obey such
2 order of the court may be punished by such court as a contempt
3 thereof.
4 C. The expenses incurred by the department in connection
5 with any examination or investigation whether regular or
6 special, including a proportionate part of the salary of any
7 examiner or other employe of the department engaged in such
8 examination or investigation and all counsel assigned by the
9 department to an examination or investigation, may be assessed
10 by the department upon the particular institution examined or
11 investigated.
12 Section 5. Section 12 of the act is amended to read:
13 Section 12. Records Required.--
14 A. Every licensee shall maintain, at the place of business
15 designated in the license certificate, such books, accounts and
16 records of the business conducted under the license issued for
17 such place of business as will enable the [administrator]
18 department to determine whether the business of the licensee
19 contemplated by this act is being operated in accordance with
20 the provisions of this act.
21 B. A licensee, operating two or more licensed places of
22 business in this Commonwealth, may maintain the general control
23 records of all such offices at any one of such offices, or at
24 any other office maintained by such licensee, upon the filing of
25 a written request with the [administrator] department
26 designating therein the office at which such control records are
27 maintained and upon approval of such request by the
28 [administrator] department.
29 C. All books, accounts and records of licensees shall be
30 maintained in the English language.
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1 D. All books, accounts and records of licensees, including
2 any cards used in a card system, shall be preserved and
3 available for examination by the [administrator] department for
4 at least two (2) years after making the final entry therein.
5 E. The [administrator] department is hereby authorized and
6 empowered to prescribe the minimum information to be shown in
7 the books, accounts and records of licensees so that such
8 records will enable the [administrator] department to determine
9 compliance with the provisions of this act.
10 Section 6. Section 14 of the act, added September 23, 1961
11 (P.L.1614, No.683) and April 4, 1990 (P.L.110, No.25), is
12 amended to read:
13 Section 14. Contents of Contract and Disclosure
14 Requirements.
15 A. Every installment sale contract shall state the full
16 names and addresses of all the parties thereto, the date when
17 signed by the buyer and shall contain a description of the motor
18 vehicle sold which shall be sufficient for accurate
19 identification.
20 B. Every installment sale contract shall clearly and
21 conspicuously in writing set forth the following separate items
22 as such, and other information as applicable in the following
23 order:
24 1. Cash price of the motor vehicle. This amount may include
25 any taxes, charges for delivery, cost of servicing, repairing or
26 improving the motor vehicle, costs of accessories and
27 installation or other costs normally included in the delivered
28 cash price of such motor vehicle.
29 2. Down payment made by the buyer at the time of or prior to
30 execution of the contract, indicating whether made in cash, or
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1 represented by the agreed value of a "trade-in" motor vehicle,
2 or other goods, or both. The amount of cash and/or the value of
3 any "trade-in" shall be shown separately. A description of the
4 "trade-in," if any, sufficient for identification shall be
5 shown.
6 3. Unpaid cash balance which shall be the difference between
7 the cash price (Item 1) and the down payment (Item 2) above.
8 4. Insurance premium costs for the payment of which the
9 seller agrees to extend credit to the buyer. The term of such
10 insurance, a concise description of the coverage and the amount
11 of the premium shall be set forth. If the precise cost of the
12 insurance is not available at the time the contract is signed,
13 an estimated amount, ascertained from a chart prepared by the
14 licensee and approved by the [administrator] department, may be
15 set forth in the contract. When the cost of the insurance is so
16 estimated, the contract shall so state and it shall contain
17 notice to the buyer that the difference between the estimated
18 cost and the actual cost of the insurance, including finance
19 charges on such amount, will be adjusted at the time of the
20 final payment on the contract, and a statement of the amount of
21 the adjustment shall be furnished to the buyer simultaneously
22 with the delivery of the insurance policy or certificate.
23 5. Other costs or charges, necessary or incidental, which
24 the seller contracts to retain or receive or to pay on behalf of
25 the buyer and [for the] any other amount [of] for which the
26 seller agrees to extend credit to the buyer as authorized by
27 this act. [Such costs] Each good or service contracted for,
28 other than those included in the cash price, shall be itemized
29 in the contract as to nature and amount.
30 6. Principal amount financed which shall be the total of the
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1 unpaid cash price balance (Item 3) plus the insurance premium
2 costs (Item 4) plus other costs (Item 5) for which the seller
3 agrees to extend credit to the buyer.
4 7. Finance charge which is the consideration in excess of
5 the cash price (Item 1), excluding insurance premium (Item 4),
6 and other costs (Item 5), which the buyer agrees to pay to the
7 seller for the privilege of purchasing the motor vehicle under
8 the installment sale contract.
9 8. Time balance which shall be the total of the principal
10 amount financed (Item 6), plus the finance charge (Item 7), and
11 which shall represent the total obligation of the buyer which he
12 agrees to pay in two or more scheduled payments.
13 9. Payment schedule which shall state the number of
14 payments, the amount of the payments and the time of the
15 payments required to liquidate the time balance.
16 10. Notwithstanding any provisions of this act or any other
17 law to the contrary, the finance charge percentage rate included
18 in an installment sale contract for the sale of a heavy
19 commercial motor vehicle may vary during the term thereof
20 pursuant to a formula or index set forth therein that is made
21 readily available to and verifiable by the buyer and is beyond
22 the control of the holder of the contract. For the purpose of
23 disclosing the amount of finance charge (Item 7) and time
24 balance (Item 8) and setting forth a payment schedule (Item 9),
25 such amounts may be calculated using the finance charge
26 percentage rate applicable to the transaction as of the date of
27 execution of the contract, notwithstanding the fact that such
28 finance charge percentage rate may increase or decrease over the
29 term of the contract according to a formula or index set forth
30 in the contract.
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1 C. Every installment sale contract shall state clearly
2 [any], to the extent applicable, the fact that the holder has or
3 will acquire a collateral security interest in the motor vehicle
4 purchased as part of the transaction and shall include a
5 description of such collateral security taken for the buyer's
6 obligation under the contract.
7 D. Every installment sale contract shall contain a summary
8 notice of the buyer's principal legal rights respecting
9 prepayment of the contract and rebate of finance charge and
10 reinstatement of the contract in the event of repossession.
11 E. Every installment sale contract shall contain specific
12 provisions as to the holder's right to accelerate the maturity
13 of the contract upon default or other breach of contract and as
14 to the buyer's liability respecting nonpayment, the dollar or
15 percentage amount of any default charges that may be imposed due
16 to a late payment, other than a deferral or extension charge,
17 repossession and sale of the motor vehicle, in case of default
18 or other breach of contract, and respecting the collateral
19 security, if any.
20 E.1. An installment sale contract which complies with the
21 Truth in Lending Act (Public Law 90-321, 15 U.S.C. § 1601 et
22 seq.) and any regulations and staff interpretations of the
23 Federal Reserve Board issued thereunder, shall be deemed to be
24 in compliance with the provisions of this section.
25 F. Every installment sale contract for the sale of a
26 mobilehome or house trailer may contain a provision which shall
27 require the buyer to pay any and all real estate taxes which may
28 thereafter be levied upon said vehicle and which shall require
29 the buyer to furnish the seller or holder with proof of payment
30 thereof in such manner and at such times as the contract may
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1 prescribe. The contract may further provide for acceleration of
2 payments and/or give the seller or holder the right to repossess
3 the vehicle upon the buyer's failure to pay such taxes or
4 furnish proof thereof as required. If the mobilehome or house
5 trailer is sold by any tax levying unit of government for
6 nonpayment of real estate taxes by such buyer, any lien or
7 encumbrance contained on the title of the vehicle pursuant to
8 "The Vehicle Code" or any encumbrance filed of record against
9 the vehicle under the provisions of the "Uniform Commercial
10 Code" shall not be affected or divested.
11 Section 7. Section 18, subsection F of section 23 and
12 sections 25, 31 and 37 of the act are amended to read:
13 Section 18. Other Costs Included in Amount Financed.--
14 A. In addition to the cost of insurance premiums authorized
15 in the preceding section of this act, the seller of a motor
16 vehicle under an installment sale contract may require the buyer
17 to pay certain other costs incurred in the sale of a motor
18 vehicle under such contract as follows:
19 1. Fees, payable to the Commonwealth of Pennsylvania, for
20 filing a lien or encumbrance on the certificate of title to a
21 motor vehicle sold under an installment sale contract or
22 collateral security thereto.
23 2. Fees, payable to a public official, for filing or
24 recording and satisfying or releasing the installment sale
25 contract or instruments securing the buyer's obligation.
26 3. Fees, for notarization required in connection with the
27 filing and recording or satisfying and releasing a mortgage,
28 judgment lien or encumbrance.
29 B. The seller of a motor vehicle under an installment sale
30 contract may also contract with the buyer to pay on behalf of
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1 the buyer, such other costs incidental to the sale of a motor
2 vehicle and contracted for voluntarily by the buyer as follows:
3 1. Fees, payable to the Commonwealth of Pennsylvania, for
4 registration of the motor vehicle and issuance or transfer of
5 registration plates.
6 2. Fees, payable to the Commonwealth of Pennsylvania, for
7 driver's license for the buyer.
8 3. Costs of messenger service and other costs associated
9 with the payment of fees or submission of documents to the
10 Commonwealth of Pennsylvania and contracted for voluntarily by
11 the buyer.
12 C. Such other costs described in subsection A or B may be
13 charged, contracted for, collected or received by the seller
14 from the buyer independently of the installment sale contract,
15 or the seller may extend credit to the buyer for the amount of
16 such costs and include such amount in the principal amount
17 financed under the installment sale contract.
18 D. Such other costs described in subsections A and B paid or
19 payable by the buyer shall not exceed the amount which the
20 seller expends or intends to expend therefor, unless otherwise
21 permitted by law. Any such costs which the seller has collected
22 from the buyer, or which have been included in the buyer's
23 obligation under the installment sale contract which are not
24 disbursed by the seller, as contemplated, shall be immediately
25 refunded or credited to the buyer.
26 Section 23. Repossession.--
27 * * *
28 F. The [administrator] department shall have authority to
29 reduce the amount of or prohibit entirely any item of expense of
30 retaking, storing or repairing of a motor vehicle which appears
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1 to him to be fictitious, unnecessary, unreasonable or
2 exorbitant, or such as would not have been incurred by a prudent
3 person under similar circumstances.
4 * * *
5 Section 25. Redemption and Termination of Contract after
6 Repossession.--
7 A. When repossession of a motor vehicle which is the subject
8 of an installment sale contract is effected within or outside of
9 the Commonwealth of Pennsylvania otherwise than by legal
10 process, the holder shall retain such repossessed motor vehicle
11 [within the county in which it was retaken] for a period of
12 fifteen (15) days after mailing of notice of repossession to the
13 buyer. [If such repossession is made outside of the Commonwealth
14 of Pennsylvania, the motor vehicle, at the option of the holder,
15 may be retained in the vicinity of retaking for such fifteen
16 (15) day period or brought back to the county in Pennsylvania in
17 which it was originally sold to the buyer under such contract
18 and retained in such county for such fifteen (15) day period.]
19 B. During such fifteen (15) day period the buyer may redeem
20 the motor vehicle and terminate the contract by payment or
21 tender of payment to the holder of the following amounts,
22 subject to the conditions hereinafter indicated:
23 1. When default at the time of repossession was less than
24 fifteen (15) days, the amount of the unpaid time balance, plus
25 the amount of any accrued default charges authorized by this
26 act, plus any other amount lawfully due under the contract,
27 excluding costs of retaking, repairing and storage, less rebate
28 of unearned finance charge.
29 2. When default at the time of repossession exceeded fifteen
30 (15) days, the amount of the unpaid time balance, plus the
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1 amount of any accrued default charges authorized by this act,
2 plus costs of retaking, repairing, repossessing and storing
3 authorized by this act, plus any other amount lawfully due under
4 the contract, less rebate of unearned finance charge.
5 C. When the buyer redeems the motor vehicle and terminates
6 the contract by payment or tender as provided in subsection B,
7 the holder shall return the motor vehicle to the county in the
8 Commonwealth of Pennsylvania where the buyer resides, or, if the
9 buyer is not a resident of the Commonwealth of Pennsylvania, to
10 the county in the Commonwealth of Pennsylvania in which the
11 vehicle was purchased under such contract.
12 Section 31. Prohibited Charges.--
13 A. A licensee under this act shall not charge, contract for,
14 collect, or receive from the buyer, directly or indirectly, any
15 further or other amount for costs, charges, examination,
16 appraisal, service, brokerage, commission, expense, interest,
17 discount, fees, fines, penalties or other thing of value in
18 connection with the retail sale of a motor vehicle under an
19 installment sale contract in excess of the cost of insurance
20 premiums, other costs or charges necessary or incidental to the
21 sale of the motor vehicle, the finance charges, refinance
22 charges, default charges, recording and satisfaction fees, court
23 costs, attorney's fees and expenses of retaking, repairing and
24 storing a repossessed motor vehicle which are authorized by the
25 provisions of this act.
26 B. A licensee under this act shall not collect any charge
27 whatsoever in connection with a contemplated sale of a motor
28 vehicle under an installment sale contract, if such contract is
29 not consummated: Provided, however, That nothing contained
30 herein shall affect the legal status of a deposit paid by a
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1 prospective buyer to a seller as a binder on the contemplated
2 purchase of a motor vehicle.
3 C. An installment sale contract, wherein the seller or any
4 subsequent holder has charged, contracted for, collected, or
5 received from the buyer any prohibited costs or charges
6 whatsoever shall be unenforcible as to such prohibited costs or
7 charges.
8 Section 37. Penalties.--
9 A. Any person, partner, association, business corporation,
10 banking institution, nonprofit corporation, common law trust,
11 joint stock company or any other group of individuals, however
12 organized, or any owner, partner, member, officer, director,
13 trustee, employe, agent, broker or representative thereof who or
14 which shall engage in this Commonwealth in business as
15 installment seller, sales finance company or collector-
16 repossessor as defined in this act without having obtained a
17 license, as required under this act, shall be guilty of a
18 misdemeanor, and upon conviction thereof, shall be sentenced to
19 pay a fine of not less than [five hundred dollars ($500)] two
20 thousand dollars ($2,000), or more than [five thousand dollars
21 ($5,000)] ten thousand dollars ($10,000), or to suffer
22 imprisonment of not less than six (6) months or, more than three
23 (3) years, or both, at the discretion of the court.
24 B. Any licensee conducting business under this act as an
25 installment seller, sales finance company or collector-
26 repossessor or any owner, partner, member, officer, director,
27 trustee, employe, agent, broker or representative thereof who
28 shall violate any provision of this act, or shall direct or
29 consent to such violation shall be guilty of a misdemeanor, and
30 upon conviction thereof, shall be sentenced to pay a fine of not
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1 more than [five hundred dollars ($500)] two thousand dollars
2 ($2,000) for the first offense; and for each subsequent offense
3 a like fine and/or suffer imprisonment not to exceed one (1)
4 year in the discretion of the court.
5 C. Any licensed seller or sales finance company as holder of
6 a motor vehicle installment sale contract who hires, authorizes
7 or permits an unlicensed collector-repossessor, as defined in
8 this act, to collect payments on any such contract or to
9 repossess any motor vehicle sold under such contract within this
10 Commonwealth shall be guilty of a violation of this act, and
11 subject to the penalties imposed by the foregoing provisions of
12 this section.
13 D. Any person licensed under the provisions of this act or
14 any director, officer, employe or agent of a licensee who shall
15 violate the provisions of this act or shall direct or consent to
16 such violation shall be subject to a fine levied by the
17 department of not more than two thousand dollars ($2,000) for
18 each offense.
19 Section 8. The act is amended by adding a section to read:
20 Section 37.1. Regulations.--
21 The department is hereby authorized to make such rules and
22 regulations as well as written interpretations of the same as
23 may be necessary or appropriate for the enforcement of this act.
24 Rules and regulations shall be adopted pursuant to the act of
25 June 25, 1982 (P.L.633, No.181), known as the "Regulatory Review
26 Act."
27 Section 9. This act shall take effect in 60 days.
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