Section 139.055. Financing.

 

(1)   Dealer arranged financing.

(a) Notice to consumer regarding ineligibility for financing. If a motor vehicle purchase contract becomes binding upon the purchaser contingent upon the motor vehicle dealer providing financing on terms disclosed to the purchaser in advance of the execution of the purchase contract, the contract shall provide that if the dealer is unable to provide such financing, the contract shall be rescinded if the dealer provides notice to the purchaser within 14 days of the contract date that dealer financing is unavailable. If the dealer fails to timely provide such notice, the purchaser may elect to carry out the contract and the dealer shall, within 28 days of the contract date, finance the purchase of the vehicle on the terms specified in the contract and deliver the vehicle in the manner specified in the purchase contract.

(b) Establishing credit terms between the contract date and delivery date for a vehicle. With respect to a contract to purchase a motor vehicle that is contingent on the motor vehicle dealer arranging financing for the motor vehicle that is acceptable to the purchaser, a dealer may, subsequent to the contract date and prior to the purchaser accepting delivery of the motor vehicle, provide the customer with notice that the dealer has arranged financing for the vehicle for which the customer is qualified. If the transaction is a consumer transaction, the notice shall include all disclosures of the terms of the arranged financing that are required by the federal truth-in-lending act including the amount to be financed, the annual interest rate, total principal and interest payments, and the monthly interest and principal payment due over the course of the loan. The notice shall state that the purchaser has 7 days to accept or reject the proposed financing. If the purchaser accepts the proposed financing, the financing contingency of the contract shall be deemed satisfied and the dealer shall be bound to provide financing on the terms set forth in the notice. If the purchaser rejects the proposed financing but waives the financing contingency, the financing contingency shall be deemed waived and the purchaser shall be bound to the contract without regard to whether the purchaser is able to secure financing. If the purchaser fails to respond to the notice within 7 days or rejects the proposed financing and does not waive the financing contingency, the purchase contract shall be rescinded.

(2)   Purchaser arranged financing. A motor vehicle purchase contract that is contingent on a purchaser arranging financing is rescinded if the purchaser does not provide evidence to the dealer that the purchaser has arranged acceptable financing for the purchase of the vehicle, such as a loan commitment letter, within a time established in the purchase contract.

(3)   No fees on void contracts. A dealer may not charge a fee or penalty to the purchaser in connection with a contract that is rescinded under this section.

History: CR 99-135 : cr. Register February 2004 No. 578 , eff. 3-1-04.