(a) A credit services organization shall not provide any service to a consumer except pursuant to a written contract that complies with this section. Every contract between the consumer and a credit services organization for the purchase of the services of the credit services organization shall identify the physical address, electronic mail address, and facsimile number if applicable, of the credit services organization, shall be in writing, shall be dated, shall be signed by the consumer, and shall include all of the following:

(1) A conspicuous statement in size equal to at least 10-point boldface type, in immediate proximity to the space reserved for the signature of the buyer, as follows:

Terms Used In California Civil Code 1789.16

  • Consumer: means any natural person who is solicited to purchase or who purchases the services of a credit services organization. See California Civil Code 1789.12
  • Contract: A legal written agreement that becomes binding when signed.
  • Credit report: A detailed report of an individual's credit history prepared by a credit bureau and used by a lender in determining a loan applicant's creditworthiness. Source: OCC
  • Credit services organization: means a person who, with respect to the extension of credit by others, sells, provides, or performs, or represents that the person can or will sell, provide, or perform, any of the following services, in return for the payment of money or other valuable consideration:

    California Civil Code 1789.12

  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • Person: includes an individual, corporation, partnership, joint venture, or any business entity. See California Civil Code 1789.12
  • Service of process: The service of writs or summonses to the appropriate party.
  • will: includes codicil. See California Civil Code 14


“You, the consumer, may cancel this contract at any time before midnight on the fifth working day after you sign it. See the attached notice of cancellation form for an explanation of this right.”


(2) The terms and conditions of payment, including the total of all payments to be made by the consumer, whether to the credit services organization or to some other person.

(3) A full and detailed description of the services to be performed by the credit services organization for the consumer, including a list of the information appearing on the consumer’s credit report that the credit services organization will seek a reasonable reinvestigation of, as described in Title 15 of Section 1681i of the United States Code, all guarantees and all promises of full or partial refunds, and the estimated length of time for performing the services, not to exceed 180 days, or a shorter period consistent with the purposes of this title as may be prescribed by the Department of Justice.

(4) The credit services organization’s principal business address and the name and address of its agent, other than the Secretary of State, in the State of California, authorized to receive service of process.

(b) The contract shall be accompanied by a completed form in duplicate, captioned “Notice of Cancellation,” which shall be attached to the contract and easily detachable, and which shall contain in type of at least 10-point the following statement written in the same language as used in the contract:

“Notice of Cancellation”

“You may cancel this contract, without any penalty or obligation, before midnight on the fifth working day after you sign it.

“If you cancel, any payment made by you under this contract must be returned within 15 days following receipt by the seller of your cancellation notice.

“To cancel this contract, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, to

_____ (name of seller) _____ at

_____ (address of seller)(place of business) _____

not later than midnight (date).

“I hereby cancel this transaction.”

(date) _____ (purchaser’s signature) _____

A copy of the fully completed contract and all other documents the credit services organization requires the buyer to sign shall be given to the consumer at the time they are signed.

(Amended by Stats. 2022, Ch. 965, Sec. 8. (AB 2424) Effective January 1, 2023.)

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