Every retail installment sale of a motor vehicle shall be evidenced by an instrument in writing signed by the retail buyer and a copy thereof shall be delivered to him by the retail seller at the time of its execution. An acknowledgment of the delivery thereof contained in the body of the instrument shall be conclusive proof of delivery in any action to enforce any obligation arising out of the retail installment sale brought by any successor in interest to the rights of the retail seller. The written instrument shall contain all of the agreements of the parties made with reference to the subject matter of the retail installment sale and shall recite the following separate items as such and in the following order: (1) the cash price of the motor vehicle which is the subject matter of the retail installment sale; (2) the amount in cash of the retail buyers’ down payments, whether made in money or goods or partly in money and partly in goods; (3) the unpaid balance of the cash price payable by the retail buyer to the retail seller, which is the difference between items 1 and 2; (4) the cost to the retail buyer of any insurance the retail seller has agreed to procure, if the retail seller has agreed to purchase the insurance and extend credit to the retail buyer for the price thereof and if the term of such insurance is less than the contract period, the period of the coverage also shall be recited; (5) the principal balance owed on the retail installment contract, which is the sum total of items 3 and 4; (6) the amount of the finance charge; (7) the time balance owed by the retail buyer to the retail seller and the number of installment payments required and the amount and date of each payment necessary finally to pay the time balance, which is the sum total of items 5 and 6.
   Item 4 and item 6 may be added together and stated as 1 sum in the written instrument and, if so stated, item 5 may be omitted, but in such event the retail seller shall within 25 days after the making of the retail installment contract, mail or cause to be mailed to the retail buyer at his address as shown on the retail installment contract a statement reciting the separate amounts of all the items, 1 to 7, inclusive. The reference to insurance in the written instrument shall recite generally the type or types of insurance the retail seller has agreed to procure for the retail buyer, but such reference to insurance shall not be construed to imply the scope of the coverage, the terms, exceptions, limitations, restrictions or conditions of the contract or contracts of insurance to be furnished. Any retail buyer shall have the right to purchase his own insurance from any person other than the retail seller, and in such event item 4 shall be omitted. No retail seller shall coerce, threaten or in any manner influence any retail buyer to purchase insurance from such retail seller, or from any company, agent or broker designated by the retail seller.

Terms Used In Michigan Laws 566.302

  • buyer: means a person who buys or agrees to buy a motor vehicle, or any legal successor in interest of such person. See Michigan Laws 566.301
  • cash price: means the price measured in dollars agreed upon in good faith by the parties as the consideration for the sale of a motor vehicle which is the subject matter of any retail installment sale, exclusive of all financing or other charges incident to such sale. See Michigan Laws 566.301
  • contract: refers to and includes any transfer, conveyance, assignment or sale of a motor vehicle to any person other than a registered dealer in motor vehicles whose place of business is located in the state of Michigan or any other dealer in motor vehicles whose place of business is located outside of the state of Michigan when such transfer, conveyance, assignment or sale is made in the ordinary course of the seller's business. See Michigan Laws 566.301
  • Contract: A legal written agreement that becomes binding when signed.
  • Finance charge: The total cost of credit a customer must pay on a consumer loan, including interest. The Truth in Lending Act requires disclosure of the finance charge. Source: OCC
  • finance charge: means any consideration which the retail buyer contracts to pay the retail seller for the privilege of paying the principal balance in installments over a period of time. See Michigan Laws 566.301
  • in writing: shall be construed to include printing, engraving, and lithographing; except that if the written signature of a person is required by law, the signature shall be the proper handwriting of the person or, if the person is unable to write, the person's proper mark, which may be, unless otherwise expressly prohibited by law, a clear and classifiable fingerprint of the person made with ink or another substance. See Michigan Laws 8.3q
  • motor vehicle: means every self-propelled device in, upon or by which any person or property is or may be transported or drawn upon a public highway, excepting devices used exclusively upon stationary rails or tracks and excepting also motorcycles, motor bicycles, farm tractors, road rollers and other machinery not designed primarily for highway transportation, but which may incidentally transport persons or property on the highway. See Michigan Laws 566.301
  • 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, partnership, corporation and any other association. See Michigan Laws 566.301
  • retail installment contract: means any written instrument which is executed in connection with any retail installment sale and includes conditional sales contracts, purchase money chattel mortgages and bailment leases retaining a security interest in the seller. See Michigan Laws 566.301
  • retail installment sale: means and includes every retail contract to sell a motor vehicle and every retail sale of a motor vehicle to any person (1) in which the cash price of the motor vehicle may be paid in installments over a period of time, and (2) in which the seller has taken or retained a security interest in the motor vehicle thereby contracted to be sold. See Michigan Laws 566.301
  • seller: means a person, who sells or agrees to sell a motor vehicle, or any legal successor in interest of such person. See Michigan Laws 566.301
   Any retail seller, who in any retail installment contract has agreed to purchase insurance for the retail buyer and to extend credit for the price thereof, shall, within 25 days after the making of the retail installment contract, mail or cause to be mailed to the retail buyer at his address as shown on the retail installment contract, a policy or policies of insurance, and in the event such policy or policies shall not be so mailed the seller shall not be entitled to recover, collect or retain that part of the obligation which represents item 4 in such contract and the buyer shall not be liable therefor.
   Under a written instrument evidencing a retail installment sale which does not substantially comply with the requirements of this section, the seller shall not be entitled to recover, collect or retain that part of the obligation which represents the finance charge and the buyer shall not be liable therefor.
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