A. Each retail installment contract shall be in writing, dated, signed by the retail buyer, and completed as to all essential provisions, except as otherwise provided in Subsections G and H of this section.

B. The printed or typed portion of the contract, other than instructions for completion, shall be in a size equal to at least eight point type. The contract shall be designated "retail installment contract" and shall contain substantially the following notice printed or typed in a size equal to at least ten point bold type:

"NOTICE TO THE BUYER. DO NOT SIGN THIS CONTRACT BEFORE YOU READ IT OR IF IT CONTAINS BLANK SPACES. YOU ARE ENTITLED TO A COPY OF THE CONTRACT YOU SIGN."

C. The retail seller shall deliver to the retail buyer, or mail to him at his 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 goods or been furnished or rendered the services, shall have the right to rescind his contract and to receive a refund of all payments made and return of all goods traded in to the seller on account of or in contemplation of the contract, or if such goods cannot be returned, the value thereof. Any acknowledgment by the buyer of delivery of a copy of the contract shall be in a size equal to at least ten point bold type and, if contained in the contract, shall appear directly above the buyer's signature.

D. 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 or identification of the goods sold or to be sold, or services furnished or rendered or to be furnished or rendered.

E. The retail installment contract shall contain the following items:

(1) the cash sale price of the goods or services;

(2) the amount of the buyer's down payment, identifying the amounts paid in money and allowed for goods traded in;

(3) the difference between items (1) and (2);

(4) the aggregate amount, if any, included for insurance, if a separate identified charge is made therefor, specifying the type or types of insurance and the term or terms of coverage;

(5) the aggregate amount of official fees;

(6) the principal balance, which is the sum of items (3), (4) and (5);

(7) the amount or rate of the time price differential;

(8) the amount of the time balance owed by the buyer to the seller, which is the sum of items (6) and the amount set out under item (7);

(9) except as otherwise provided in the next two sentences, the maximum number of installment payments required and the amount of each installment and the due date of each payment necessary to pay the time balance set forth in item (8). If installment payments other than the final payment are stated as a series of equal scheduled amounts and if the amount of the final installment payment does not substantially exceed the scheduled amount of each preceding installment payment, the maximum number of payments and the amount and due date of each payment need not be separately stated and the amount of the scheduled final installment payment may be stated as the remaining unpaid balance. The due date of the first installment payment may be fixed by a day or date or may be fixed by reference to the date of the contract or to the time of delivery or installation;

(10) the time sale price; and

(11) if any installment (except the down payment) is more than double the average of all other installments (except the down payment), the following legend printed in at least ten point bold type or typewritten: THIS CONTRACT IS NOT PAYABLE IN INSTALLMENTS OF EQUAL AMOUNTS followed, if there be but one such larger installment, by: AN INSTALLMENT OF $ . . . . . . . . . . WILL BE DUE ON . . . . . . . . . . or, if there be more than one such larger installment, by: LARGER INSTALLMENTS WILL BE DUE AS FOLLOWS: . . . . . . . . . . . . ., in such latter case, inserting the amount of every such larger installment and of its due date.

The above items need not be stated in the sequence or order set forth; additional items may be included to explain the computations made in determining the amount to be paid by the buyer.

F. A retail installment contract need not be contained in a single document. If the contract is contained in more than one document, one such document may be an original document signed by the retail buyer, stated to be applicable to purchases of goods or services to be made by the retail buyer from time to time. In such case, such document, together with the sales slip, account book or other written statement relating to each purchase, shall set forth all of the information required by this section and shall constitute the retail installment contract for each purchase. On each succeeding purchase pursuant to such original document, the sales slip, account book or other written statement may at the option of the seller constitute the memorandum required by Subsection M of this section.

G. Retail installment contracts negotiated and entered into by mail without personal solicitations by salesmen or other representatives of the seller and based upon a catalog of the seller, or other printed solicitation which clearly sets forth the cash sale prices and other terms of sales to be made through such medium, may be made as provided in this subsection. The provisions of this act [56-1-1 to 56-1-13 NMSA 1978] with respect to retail installment contracts shall be applicable to such sales, except that:

(1) the designation and notice provisions of Subsection B of this section shall not be applicable to such contract; and

(2) the retail installment contract, when completed by the buyer, need not contain the items required by Subsection E of this section.

When the contract is received from the retail buyer, the seller shall prepare a written memorandum containing all of the information required by Subsection E of this section to be included in a retail installment contract. In lieu of delivering a copy of the contract to the retail buyer as provided in Subsection C of this section, the seller shall deliver to the buyer a copy of such memorandum prior to the due date of the first installment payable under the contract.

H. A retail installment contract shall not be signed by any party thereto when it contains blank spaces of items which are essential provisions of the transaction; provided, however, if delivery of the goods is not made at the time of the execution of the contract, the identifying numbers of marks of the goods or similar information and the due date of the first installment may be inserted by the seller in the seller's counterpart of the contract after it has been signed by the buyer. The buyer's acknowledgment, conforming to the requirements of this section, of delivery of a copy of the contract shall be presumptive proof, or, in the case of a holder of the contract without knowledge to the contrary when he purchases it, conclusive proof of such delivery and of compliance with this subsection and any other requirement relating to completion of the contract prior to execution thereof by the buyer, in any action or proceeding.

I. Notwithstanding the provisions of any other law, a retail installment contract may provide for, and the seller or holder may then charge, collect and receive a time price differential.

The time price differential on a retail installment contract shall be computed on the principal balance of each transaction, as determined under Subsection E on contracts payable in successive monthly payments substantially equal in amount from the date of the contract to the maturity of the final payment, notwithstanding that the total time balance thereof is required to be paid in one or more deferred payments. When a retail installment contract provides for payment other than in substantially equal successive monthly payments, the time price differential shall not exceed the amount which will provide the same return as is permitted on substantially equal successive monthly payment contracts, having due regard for the schedule of payments. The time price differential may be computed on the basis of a full month for any fractional portion of a month in excess of ten days.

J. Notwithstanding the provisions of any retail installment contract to the contrary, any buyer may prepay in full the unpaid time balance thereof at any time before its final due date and, if he does so, shall receive a refund credit thereon for such prepayment. The amount of such refund credit shall represent at least as great a proportion of the original time price differential, after deducting therefrom a maximum of ten dollars ($10.00) as:

(1) the sum of the monthly balances under the schedule of payments in the contract beginning as of the date after such prepayment which is the next succeeding monthly anniversary date of the due date of the first installment under the contract, or, if the prepayment is prior to the due date of the first installment under the contract, then as of the date after such prepayment which is the next succeeding monthly anniversary date of the date of the contract, bears to;

(2) the sum of all the monthly balances under the schedule of installment payments in the contract. Where the amount of refund credit is less than one dollar ($1.00), no refund credit need be made.

K. The holder of any retail installment contract, if it so provides, may collect a delinquency and collection charge on each installment in default for a period of more than ten days in the amount not to exceed five percent of each installment or five dollars ($5.00), whichever is less, or in lieu thereof, interest after maturity of each such installment not to exceed the highest lawful contract rate. In addition, such contract may provide for the payment of an attorney's reasonable fee where it is referred for collection to an attorney not a salaried employee of the holder of the contract, and for court costs and disbursements.

L. 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 payments and the total amount unpaid under the contract. A buyer shall be given a written receipt for any payment when made in cash. Such a statement or receipt shall be given the buyer once without charge; if any additional statement is requested by the buyer, it shall be supplied by the holder at a charge not in excess of one dollar ($1.00) for each additional statement or receipt so supplied.

M. (1) If, in a retail installment transaction, a retail buyer makes any subsequent purchases of goods or services from a retail seller from whom he has previously purchased goods or services under one or more retail installment contracts, and the amounts under such previous contract or contracts have not been fully paid, the subsequent purchases may, at the seller's option, be included in and consolidated with one or more of the previous contract or contracts. Each subsequent purchase shall be a separate retail installment contract under this act [56-1-1 to 56-1-13 NMSA 1978], notwithstanding that the same may be included in and consolidated with one or more of such previous contract or contracts. All the provisions of this act with respect to retail installment contracts shall be applicable to such subsequent purchases except as hereinafter stated in this subsection.

(2) In the event of such consolidation, in lieu of the buyer's executing a retail installment contract respecting each subsequent purchase, as provided in this section, it shall be sufficient if the seller shall prepare a written memorandum of each subsequent purchase, in which case the provisions of Subsections A, B, C and E of this section shall not be applicable. Unless previously furnished in writing to the buyer by the seller, by sales slip, memorandum or otherwise, such memorandum shall contain with respect to each subsequent purchase items (1) through (8) of Subsection E of this section and, in addition, the outstanding balance of the previous contract or contracts, the consolidated time balance, and the revised installments applicable to the consolidated time balance, if any.

The seller shall deliver to the buyer a copy of such memorandum prior to the due date of the first installment of such consolidated contract.

(3) When such subsequent purchases are made, if the seller has retained title or taken a lien or other security interest in any of the goods purchased under any one of the contracts included in the consolidation, the entire amount of all payments made prior to such subsequent purchases shall be deemed to have been applied on the previous purchases; and each payment after such subsequent purchase made on the consolidated contract shall be deemed to have been allocated to the purchases earliest in time. The payments shall be credited first to the current carrying charges and then in reduction of the purchase price of merchandise in the order in which it was purchased. Articles of merchandise for which the sales price and carrying charges have been paid for under this section shall not thereafter be repossessed or considered security for payment of any charge arising out of any subsequent purchases made by the buyer. However, the amount of any down payment on the subsequent purchase shall be allocated in its entirety to such subsequent purchase. The provisions of this paragraph shall not apply to cases where such previous and subsequent purchases involve equipment, parts, or other goods attached or affixed to goods previously purchased and not fully paid, or to services in connection therewith rendered by the seller at the buyer's request.

History: 1953 Comp., § 50-16-2, enacted by Laws 1965, ch. 258, § 2; 1971, ch. 110, § 1; 1981, ch. 186, § 1.

Am. Jur. 2d, A.L.R. and C.J.S. references. — 67 Am. Jur. 2d Sales §§ 8, 41, 65 to 67, 103 to 106, 155 to 157, 205 to 207, 416 to 424.

Validity and construction of provision imposing "late charge" or similar exaction for delay in making periodic payments on note, mortgage, or installment sale contract, 63 A.L.R.3d 50.

77A C.J.S. Sales § 9 et seq.