Short title -- 1992 c 134.
This act may be known and cited as the Washington
lease-purchase agreement act.
Severability -- 1992 c 134.
If any provision of this act or its application to any
person or circumstance is held invalid, the remainder of the act
or the application of the provision to other persons or
circumstances is not affected.
As used in this chapter, unless the context otherwise
(1) "Advertisement" means a commercial message in any
medium that aids, promotes, or assists, directly or indirectly,
a lease-purchase agreement.
(2) "Cash price" means the price at which the lessor
would have sold the property to the consumer for cash on the
date of the lease-purchase agreement.
(3) "Consumer" means a natural person who rents personal
property under a lease-purchase agreement to be used primarily
for personal, family, or household purposes.
(4) "Consummation" means the time a consumer becomes
contractually obligated on a lease-purchase agreement.
(5) "Lease-purchase agreement" means an agreement for
the use of personal property by a natural person primarily for
personal, family, or household purposes, for an initial period
of four months or less that is automatically renewable with each
payment after the initial period, but does not obligate or
require the consumer to continue leasing or using the property
beyond the initial period, and that permits the consumer to
become the owner of the property.
(6) "Lessor" means a person who regularly provides the
use of property through lease-purchase agreements and to whom
lease payments are initially payable on the face of the
[1992 c 134 § 2.]
(1) Lease-purchase agreements that comply with this chapter
are not governed by the laws relating to:
(a) A consumer lease as defined in chapter
(b) A retail installment sale of goods or services as
regulated under chapter
(c) A security interest as defined in Title
62A RCW; or
(d) Loans, forbearances of money, goods, or things in
action as governed by chapter
(2) This chapter does not apply to the following:
(a) Lease-purchase agreements primarily for business,
commercial, or agricultural purposes, or those made with
governmental agencies or instrumentalities or with
(b) A lease of a safe deposit box;
(c) A lease or bailment of personal property that is
incidental to the lease of real property, and that provides that
the consumer has no option to purchase the leased property; or
(d) A lease of an automobile.
[1992 c 134 § 3.]
Disclosure by lessor -- Requirement.
(1) The lessor shall disclose to the consumer the
information required under this chapter. In a transaction
involving more than one lessor, only one lessor need make the
disclosures, but all lessors shall be bound by such disclosures.
(2) The disclosure shall be made at or before consummation of
the lease-purchase agreement.
(3) The disclosure shall be made clearly and conspicuously in
writing and a copy of the lease-purchase agreement provided to
the consumer. The disclosures required under RCW
63.19.040(1) shall be made on the
face of the contract above the line for the consumer's
(4) If a disclosure becomes inaccurate as the result of any
act, occurrence, or agreement by the consumer after delivery of
the required disclosures, the resulting inaccuracy is not a
violation of this chapter.
[1992 c 134 § 4.]
Disclosure by lessor -- Contents.
(1) For each lease-purchase agreement, the lessor shall
disclose in the agreement the following items, as applicable:
(a) The total number, total amount, and timing of all
payments necessary to acquire ownership of the property;
(b) A statement that the consumer will not own the
property until the consumer has made the total payment necessary
to acquire ownership;
(c) A statement that the consumer is responsible for the
fair market value of the property if, and as of the time, it is
lost, stolen, damage, or destroyed;
(d) A brief description of the leased property,
sufficient to identify the property to the consumer and the
lessor, including an identification number, if applicable, and a
statement indicating whether the property is new or used, but a
statement that indicates new property is used is not a violation
of this chapter;
(e) A brief description of any damage to the leased
(f) A statement of the cash price of the property. Where
the agreement involves a lease of five or more items as a set,
in one agreement, a statement of the aggregate cash price of all
items shall satisfy this requirement;
(g) The total of initial payments paid or required at or
before consummation of the agreement or delivery of the
property, whichever is later;
(h) A statement that the total of payments does not
include other charges, such as late payment, default, pickup,
and reinstatement fees, which fees shall be separately disclosed
in the contract;
(i) A statement clearly summarizing the terms of the
consumer's option to purchase, including a statement that the
consumer has the right to exercise an early purchase option and
the price, formula, or method for determining the price at which
the property may be so purchased;
(j) A statement identifying the party responsible for
maintaining or servicing the property while it is being leased,
together with a description of that responsibility, and a
statement that if any part of a manufacturer's express warranty
covers the lease property at the time the consumer acquires
ownership of the property, it shall be transferred to the
consumer, if allowed by the terms of the warranty;
(k) The date of the transaction and the identities of
the lessor and consumer;
(l) A statement that the consumer may terminate the
agreement without penalty by voluntarily surrendering or
returning the property in good repair upon expiration of any
lease term along with any past due rental payments; and
(m) Notice of the right to reinstate an agreement as
(2) With respect to matters specifically governed by the
federal consumer credit protection act, compliance with the act
satisfies the requirements of this section.
[1992 c 134 § 5.]
Agreement -- Restrictions.
A lease-purchase agreement may not contain:
(1) A confession of judgment;
(2) A negotiable instrument;
(3) A security interest or any other claim of a property
interest in any goods except those goods delivered by the lessor
pursuant to the lease-purchase agreement;
(4) A wage assignment;
(5) A waiver by the consumer of claims or defenses; or
(6) A provision authorizing the lessor or a person
acting on the lessor's behalf to enter upon the consumer's
premises or to commit any breach of the peace in the
repossession of goods.
[1992 c 134 § 6.]
Consumer -- Reinstatement of agreement -- Terms.
(1) A consumer who fails to make a timely rental payment may
reinstate the agreement, without losing any rights or options
that exist under the agreement, by the payment of:
(a) All past due rental charges;
(b) If the property has been picked up, the reasonable
costs of pickup and redelivery; and
(c) Any applicable late fee, within ten days of the
renewal date if the consumer pays monthly, or within five days
of the renewal date if the consumer pays more frequently than
(2) In the case of a consumer who has paid less than
two-thirds of the total of payments necessary to acquire
ownership and where the consumer has returned or voluntarily
surrendered the property, other than through judicial process,
during the applicable reinstatement period set forth in
subsection (1) of this section, the consumer may reinstate the
agreement during a period of not less than twenty-one days after
the date of the return of the property.
(3) In the case of a consumer who has paid two-thirds or
more of the total of payments necessary to acquire ownership,
and where the consumer has returned or voluntarily surrendered
the property, other than through judicial process, during the
applicable period set forth in subsection (1) of this section,
the consumer may reinstate the agreement during a period of not
less than forty-five days after the date of the return of the
(4) Nothing in this section shall prevent a lessor from
attempting to repossess property during the reinstatement
period, but such a repossession shall not affect the consumer's
right to reinstate. Upon reinstatement, the lessor shall provide
the consumer with the same property or substitute property of
comparable quality and condition.
[1992 c 134 § 7.]
Written receipt -- Lessor's duty.
A lessor shall provide the consumer a written receipt for
each payment made by cash or money order.
[1992 c 134 § 8.]
Renegotiation -- Same lessor and consumer.
(1) A renegotiation shall occur when an existing
lease-purchase agreement is satisfied and replaced by a new
agreement undertaken by the same lessor and consumer. A
renegotiation shall be considered a new agreement requiring new
disclosures. However, events such as the following shall not be
treated as renegotiations:
(a) The addition or return of property in a
multiple-item agreement or the substitution of the lease
property, if in either case the average payment allocable to a
payment period is not changed by more than twenty-five percent;
(b) A deferral or extension of one or more periodic
payments, or portions of a periodic payment;
(c) A reduction in charges in the lease or agreement;
(d) A lease or agreement involved in a court proceeding.
(2) No disclosures are required for any extension of a
[1992 c 134 § 9.]
Advertising -- Requirements -- Liability.
(1) If an advertisement for a lease-purchase agreement
refers to or states the dollar amount of any payment and the
right to acquire ownership for any one specific item, the
advertisement shall also clearly and conspicuously state the
following items, as applicable:
(a) That the transaction advertised is a lease-purchase
(b) The total of payments necessary to acquire
(c) That the consumer acquires no ownership rights if
the total amount necessary to acquire ownership is not paid.
(2) Any owner or personnel of any medium in which an
advertisement appears or through which it is disseminated shall
not be liable under this section.
(3) The provisions of subsection (1) of this section
shall not apply to an advertisement that does not refer to or
state the amount of any payment, or which is published in the
yellow pages of a telephone directory or in any similar
directory of business.
[1992 c 134 § 10.]
Upholstered furniture or bedding.
Upon the return of leased upholstered furniture or bedding,
the lessor shall sanitize the property. A lessor shall not lease
used upholstered furniture or bedding that has not been
[1992 c 134 § 11.]
Violation -- Application of chapter
The Washington lease-purchase agreement act is a matter
affecting the public interest for the purpose of applying
19.86 RCW. The violation of this chapter is not reasonable
in relation to the development and preservation of business. A
violation of this chapter constitutes an unfair or deceptive act
or practice in trade or commerce for the purpose of applying
[1992 c 134 § 12.]