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RTO Online
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Illinois Rental Purchase Factoids |
| Agreements must be written in any other language used by
the merchant in any oral or written advertisement |
| Grace period for late fees and re-instatement charges is 3
days for all agreement periods |
| Maximum late fee and re-instatement fee is $5 |
| Customers may reinstate without losing rights for a minimum
of 1 week and a maximum of 1/2 the number of days in a regular payment
period after the due date of the payment. |
If merchandise is returned during this period, the
reinstatement period is extended as follows...
30 days if the consumer has paid less than 60% of the total amount to
acquire ownership, and 60 days if the consumer has paid 60% or more |
| Must use the terms 'New' or 'Used' |
|
The only requirement for price tags is a tag disclosing the amount to be
paid to acquire ownership of the merchandise. |
This is a feature of the Illinois Rental Purchase
Act. We
have included a printable version of the bill
RTO Online maintains links to all available State Statutes
on our Regulations page.
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Following is the Illinois Statute in its entirety
Current as of 09-26-02
Please check with your legislature to verify
Illinois Rental Purchase
Act
Effective since __
(815 ILCS 655/)
(815 ILCS 655/0.01)
Sec. 0.01. Short title. This Act may
be cited as the
Rental-Purchase Agreement Act.
(Source: P.A. 86-1324.)
(815 ILCS 655/1)
Sec. 1. Definitions.
In this Act:
(1) "Advertisement" means a commercial message in any medium
that directly or indirectly promotes or assists a rental-purchase agreement.
(2) "Cash price" means the price for which the merchant would have
sold the merchandise to the consumer for cash on the date of the
rental-purchase agreement.
(3) "Consumer" means an individual who leases personal property
under a rental-purchase agreement.
(4) "Merchandise" means the personal property that is the subject
of a rental-purchase agreement.
(5) "Merchant" means a person who, in the ordinary course of
business, regularly leases, offers to lease or arranges for the leasing
of merchandise under a rental-purchase agreement, and includes a person who is
assigned an interest in a rental-purchase agreement.
(6) "Rental-purchase agreement" means an agreement for the use of
merchandise by a consumer 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 consumer to become the
owner of the merchandise.
(Source: P.A. 85-957.)
(815 ILCS 655/2)
Sec. 2. Form.
(a) A rental-purchase agreement must be written in plain English
and clearly and simply in any other language used by the merchant in any
oral or written advertisement related to the rental-purchase agreement.
Numerical amounts must be stated in figures.
(b) Disclosures required by this Act must be printed or typed in
each rental-purchase agreement in a size equal to at least 10 point
bold-faced type.
(c) A rental-purchase agreement may not contain a provision:
(1) requiring a confession of judgment;
(2) authorizing a merchant or an agent of the merchant to
commit a breach of the peace in the repossession of merchandise;
(3) waiving a defense, counterclaim or right the consumer may
have against the merchant or an agent of the merchant;
(4) requiring the purchase of insurance from the merchant to
cover the merchandise;
(5) requiring the payment of a late charge or reinstatement
fee unless a periodic payment is delinquent for 3 days and the
charge or fee is in an amount not more than $5; or
(6) requiring a payment at the end of the scheduled
rental-purchase term in excess of or in addition to a regular
periodic payment in order to acquire ownership of the merchandise.
In no event shall the consumer be required to pay a sum greater than the total
amount to be paid to acquire ownership, as disclosed in item (3) of subsection
(g) of this Section.
(d) Only one late charge or reinstatement fee may be collected
on a
payment regardless of the period during which it remains in default.
(e) A rental-purchase agreement must provide that:
(1) a charge in addition to periodic payments, if any, must be
reasonably related to the service performed; and
(2) a consumer who fails to make a timely payment may
reinstate an agreement, without losing rights or options previously
acquired, by taking the required action before the later of one week
or half of the number of days in a regular payment period after the
due date of the payment.
(f) Notice of the right to reinstate an agreement must be
disclosed
in the agreement. This Act does not prevent a merchant from attempting
repossession of merchandise during the reinstatement period, in
accordance with the agreement, and the consumer's right to reinstate an
agreement does not expire because of such a repossession. If the
merchandise is returned to the merchant during the applicable
reinstatement period, other than through judicial process, the right to
reinstate the agreement shall be extended for a period of not less than
30 days if the consumer has paid less than 60% of the total amount to be
paid to acquire ownership of the merchandise and shall be extended for a
period of not less than 60 days if the consumer has paid 60% or more of
the total amount to be paid to acquire ownership of the merchandise. On
reinstatement, the merchant shall provide the consumer with the same
merchandise or substitute merchandise of comparable quality and
condition. If substitute merchandise is provided, the merchant shall
also provide the consumer with the disclosures required in subsection
(g) of this Section.
(g) A rental-purchase agreement must disclose:
(1) whether the merchandise is new or used;
(2) the amount and timing of payments;
(3) the total number of payments necessary and the total
amount to be paid to acquire ownership of the merchandise;
(4) the amount and purpose of any payment, charge or fee in
addition to the regular periodic payments;
(5) whether the consumer is liable for loss or damage to the
merchandise, and, if so, the maximum amount for which the consumer may be
liable;
(6) that the consumer does not acquire ownership rights unless
the consumer has complied with the ownership terms of the agreement; and
(7) the cash price of the merchandise, whether the merchandise
is new or used.
(Source: P.A. 87-256; 88-644, eff. 9-9-94.)
(815 ILCS 655/3)
Sec. 3. Advertisement.
(a) An advertisement for a rental-purchase agreement that refers to
or states the amount of a payment or the right to acquire ownership of
any one particular item under the agreement must clearly and
conspicuously state:
(1) that the transaction advertised is a rental-purchase
agreement;
(2) the total amount and number of payments necessary to
acquire ownership; and
(3) that the consumer does not acquire ownership rights unless
the merchandise is rented for a specified number of payment periods.
(b) Every item of property displayed or offered for
rental-purchase
by a merchant shall have attached to its front or displayed as
prominently as if attached to its front a tag disclosing the amount to
be paid to acquire ownership of the merchandise.
(Source: P.A. 88-644, eff. 9-9-94.)
(815 ILCS 655/4)
Sec. 4. Enforcement.
(a) A consumer damaged by a violation of this
Act by a merchant is entitled to recover from the merchant:
(1) actual damages;
(2) 25% of an amount equal to the total amount of payments
required to obtain ownership of the merchandise involved, except that the amount
recovered under this item (2) may not be less than $250 nor more than $1,000;
and
(3) reasonable attorney's fees and court costs.
(b) A merchant is not liable under this Section for a violation
of this Act caused by the merchant's error if before the 31st day after the date
the merchant discovers the error, and before an action under this Section is
filed or written notice of the error is received by the merchant from the
consumer, the merchant gives the consumer written notice of the error and makes
adjustments in the consumer's account as necessary to assure that the consumer
will not be required to pay an amount in excess of the amount disclosed and that
the agreement otherwise complies with this Act.
(Source: P.A. 85-957.)
(815 ILCS 655/5)
Sec. 5. Penalty.
Any person intentionally violating this Act shall be guilty of a petty offense
and fined not more than $500.
(Source: P.A. 85-957.)
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