SB589,5,44 218.01 (1) (ct) "Consumer lease" has the meaning given in s. 429.104 (9).
SB589, s. 3 5Section 3. 218.01 (1) (ji) of the statutes is created to read:
SB589,5,76 218.01 (1) (ji) "Lease" or "leasing" means, with respect to a lessor, to enter into
7or offer to enter into a consumer lease with a lessee.
SB589, s. 4 8Section 4. 218.01 (1) (jj) of the statutes is created to read:
SB589,5,99 218.01 (1) (jj) "Lessee" has the meaning given in s. 429.104 (17).
SB589, s. 5 10Section 5. 218.01 (1) (jk) of the statutes is created to read:
SB589,6,2
1218.01 (1) (jk) "Lessor" means a person who leases a motor vehicle to a lessee
2under a consumer lease, but does not include an assignee of a consumer lease.
SB589, s. 6 3Section 6. 218.01 (1) (n) 1. and 2. of the statutes are amended to read:
SB589,6,64 218.01 (1) (n) 1. For commission, money or other thing of value, sells, leases,
5exchanges, buys, rents with the option of purchase, offers or attempts to negotiate
6a sale, consumer lease or exchange of an interest in motor vehicles; or,
SB589,6,97 2. Is engaged wholly or in part in the business of selling or leasing motor
8vehicles, including motorcycles, whether or not such motor vehicles are owned by
9such person, firm or corporation.
SB589, s. 7 10Section 7. 218.01 (1) (o) 5. of the statutes is created to read:
SB589,6,1211 218.01 (1) (o) 5. Sales finance companies who purchase or otherwise acquire
12consumer leases from a motor vehicle dealer.
SB589, s. 8 13Section 8. 218.01 (1) (p) of the statutes is amended to read:
SB589,6,1814 218.01 (1) (p) "Motor vehicle salesperson" means sales representative, sales
15manager, general manager or other person who is employed by a motor vehicle dealer
16for the purpose of selling or approving retail sales, or leasing or approving consumer
17leases,
of motor vehicles. Any motor vehicle salesperson licensed hereunder shall be
18licensed to sell or lease only for one dealer at a time.
SB589, s. 9 19Section 9. 218.01 (1) (pw) of the statutes is created to read:
SB589,6,2020 218.01 (1) (pw) "Periodic" has the meaning given in s. 429.104 (20).
SB589, s. 10 21Section 10. 218.01 (1) (qm) of the statutes is created to read:
SB589,6,2422 218.01 (1) (qm) "Prelease agreement" means an agreement to enter into a
23consumer lease whereby the motor vehicle will be available and ready to be delivered
24to the prospective lessee at a later time.
SB589, s. 11 25Section 11. 218.01 (1) (v) of the statutes is amended to read:
SB589,7,7
1218.01 (1) (v) "Sales finance company" means and includes any person, firm or
2corporation engaging in the business, in whole or in part, of acquiring by purchase
3or by loan on the security thereof, or otherwise, retail instalment contracts or
4consumer leases
from retail sellers or lessors in this state, including any motor
5vehicle dealer who sells or leases any motor vehicle on an instalment contract or
6consumer lease
or acquires any retail instalment contracts in the dealer's retail sales
7or leases of motor vehicles.
SB589, s. 12 8Section 12. 218.01 (1a) of the statutes, as affected by 1995 Wisconsin Act 27,
9is amended to read:
SB589,7,2410 218.01 (1a) Authority of licensors. The department of transportation shall
11issue the licenses provided for in sub. (2) (d) 1. to 6. and have supervision over the
12licensees thereunder in respect to all the provisions of this section, except only as to
13such matters as relate to the sale of motor vehicles on retail instalment contracts and
14the financing and servicing of such contracts and as to such matters as relate to
15consumer leases
, over which matter the division of banking shall have jurisdiction
16and control, and the division of banking shall issue the licenses to sales finance
17companies. Either licensor hereunder shall, upon request, furnish the other licensor
18with any information it may have in respect to any licensee or applicant for license
19or any transaction in which such licensee or applicant may be a party or be
20interested. No license shall be issued under sub. (2) (d) 1. and 8. until both licensors
21have approved the application. The suspension or revocation of either of such
22licenses shall automatically likewise suspend or revoke the other license; and such
23suspension or revocation shall be certified by the licensor ordering it to the other
24licensor.
SB589, s. 13
1Section 13. 218.01 (2) (b) of the statutes, as affected by 1995 Wisconsin Act 27,
2section 5843, is amended to read:
SB589,8,173 218.01 (2) (b) Application for license shall be made to the licensor, at such time,
4in such form and with such information as the licensor shall require and shall be
5accompanied by the required fees. An applicant for a sales finance company license,
6other than a motor vehicle dealer, shall pay to the division of banking a
7nonrefundable $300 investigation fee in addition to the license fee under par. (dr).
8If the cost of an investigation exceeds $300, the applicant shall, upon demand of the
9division of banking, pay the amount by which the cost of the investigation exceeds
10the nonrefundable fee. A licensee is not required to pay an investigation fee for the
11renewal of a license. The licensor may require the applicant to provide information
12relating to any pertinent matter that is commensurate with the safeguarding of the
13public interest in the locality in which the applicant proposes to engage in business,
14except that information relating to the applicant's solvency and financial standing
15may not be required for motor vehicle dealers except as provided in par. (h) 1. The
16information provided may be considered by the licensor in determining the fitness
17of the applicant to engage in business as set forth in this section.
SB589, s. 14 18Section 14. 218.01 (2) (bb) of the statutes, as affected by 1995 Wisconsin Act
1927
, is renumbered 218.01 (2) (bb) 1.
SB589, s. 15 20Section 15. 218.01 (2) (bb) 2. of the statutes is created to read:
SB589,9,321 218.01 (2) (bb) 2. A sales finance company or an applicant for a sales finance
22company license shall provide and maintain in force a bond or irrevocable letter of
23credit of not less than $25,000 issued by a surety company licensed to do business in
24this state or a federally insured financial institution, as defined in s. 705.01 (3). The
25bond or letter of credit shall be payable to the state of Wisconsin for the use of the

1state and of any person who sustains a loss because of an act of a sales finance
2company that constitutes grounds for the suspension or revocation of a license under
3this section.
SB589, s. 16 4Section 16. 218.01 (2) (d) 8. b. of the statutes, as affected by 1995 Wisconsin
5Act 27
, is amended to read:
SB589,9,96 218.01 (2) (d) 8. b. For motor vehicle dealers that operate as a sales finance
7company or that carry or retain time sales retail instalment contracts or consumer
8leases
for more than 30 days, to the division of banking, the same as for sales finance
9companies under par. (dr), except for gross volume of $100,000 or less, $50.
SB589, s. 17 10Section 17. 218.01 (2) (dr) of the statutes, as affected by 1995 Wisconsin Act
1127
, is amended to read:
SB589,9,2012 218.01 (2) (dr) The fee for licenses for sales finance companies, except as
13provided in par. (d) 8.,
for each calendar year, or part of a calendar year, is based on
14the gross volume of purchases of retail sales instalment contracts and consumer
15leases
of motor vehicles sold or leased in this state for the 12 months immediately
16preceding October 31 of the year in which the application for license is made, as
17follows: On a gross volume of $100,000 or less, $50; and on each $100,000 or part
18thereof over $100,000, an additional $15. No extra charge shall be made for branch
19licenses for sales finance companies. Gross volume shall be based on the unpaid
20balance of the retail instalment contracts and consumer leases.
SB589, s. 18 21Section 18. 218.01 (2) (h) 2. of the statutes, as affected by 1995 Wisconsin Act
2227
, is amended to read:
SB589,9,2523 218.01 (2) (h) 2. Provided the licensor has reasonable cause to doubt the
24financial responsibility of the applicant or licensee or the compliance by the
25applicant or licensee with this section, the licensor may require the applicant or

1licensee to furnish and maintain a bond in the form, amount and with the sureties
2it approves, but not less than $5,000, nor more than $100,000, conditioned upon the
3applicant or licensee complying with the statutes applicable to the licensee and as
4indemnity for any loss sustained by any person by reason of any acts of the licensee
5constituting grounds for suspension or revocation of the license under this section.
6The bonds shall be executed in the name of the department of transportation for the
7benefit of any aggrieved parties; provided that the aggregate liability of the surety
8to all such parties shall, in no event, exceed the amount of the bond. The bonding
9requirements in this subdivision shall not apply to manufacturers, factory branches,
10and their agents and is in addition to the bond or letter of credit required of a motor
11vehicle dealer under par. (bb) 1.
SB589, s. 19 12Section 19. 218.01 (2) (k) 3. of the statutes is amended to read:
SB589,10,1413 218.01 (2) (k) 3. Has had experience or training in, or is otherwise qualified for,
14selling or leasing motor vehicles.
SB589, s. 20 15Section 20. 218.01 (2) (k) 5. of the statutes is amended to read:
SB589,10,1716 218.01 (2) (k) 5. Is reasonably familiar with the motor vehicle sales or consumer
17lease
laws or contracts that the applicant is proposing to solicit, negotiate or effect.
SB589, s. 21 18Section 21. 218.01 (3) (a) 5. of the statutes is amended to read:
SB589,10,2019 218.01 (3) (a) 5. Wilfully defrauding any retail buyer , lessee or prospective
20lessee
to the buyer's, lessee's or prospective lessee's damage.
SB589, s. 22 21Section 22. 218.01 (3) (a) 6. of the statutes is amended to read:
SB589,10,2322 218.01 (3) (a) 6. Wilful failure to perform any written agreement with any retail
23buyer, lessee or prospective lessee.
SB589, s. 23 24Section 23. 218.01 (3) (a) 8. of the statutes is amended to read:
SB589,11,2
1218.01 (3) (a) 8. Having made a fraudulent sale, consumer lease, prelease
2agreement,
transaction or repossession.
SB589, s. 24 3Section 24. 218.01 (3) (a) 9. of the statutes is amended to read:
SB589,11,74 218.01 (3) (a) 9. Fraudulent misrepresentation, circumvention or concealment
5through whatsoever subterfuge or device of any of the material particulars or the
6nature thereof required hereunder to be stated or furnished to the retail buyer, lessee
7or prospective lessee
.
SB589, s. 25 8Section 25. 218.01 (3) (a) 10. of the statutes is amended to read:
SB589,11,129 218.01 (3) (a) 10. Employment of fraudulent devices, methods or practices in
10connection with compliance with the statutes with respect to the retaking of goods
11under retail instalment contracts or consumer leases and the redemption and resale
12or subsequent lease of such goods.
SB589, s. 26 13Section 26. 218.01 (3) (a) 13. of the statutes is amended to read:
SB589,11,1514 218.01 (3) (a) 13. Having sold a retail instalment contract or consumer lease
15to a sales finance company not licensed hereunder.
SB589, s. 27 16Section 27. 218.01 (3) (a) 14. of the statutes is amended to read:
SB589,11,1817 218.01 (3) (a) 14. Having violated any law relating to the sale, lease,
18distribution or financing of motor vehicles.
SB589, s. 28 19Section 28. 218.01 (3) (a) 18. of the statutes is amended to read:
SB589,12,220 218.01 (3) (a) 18. Having accepted an order or contract of purchase or a contract
21from a buyer or a consumer lease or prelease agreement from a lessee or prospective
22lessee
if such arrangement results in the practice of bushing. For the purpose of this
23section, "bushing" means the practice of increasing the selling price or capitalized
24cost
of a motor vehicle above that originally quoted the purchaser , lessee or
25prospective lessee
as evidenced by a purchase order or , contract, prelease agreement

1or consumer lease
which has been signed by both the purchaser, lessee or prospective
2lessee
and dealer licensee.
SB589, s. 29 3Section 29. 218.01 (3) (a) 19. of the statutes is amended to read:
SB589,12,84 218.01 (3) (a) 19. Having advertised, printed, displayed, published,
5distributed, broadcast or televised or caused or permitted to be advertised, printed,
6displayed, published, distributed, broadcast or televised in any manner whatsoever,
7any statement or representation with regard to the sale, lease or financing of motor
8vehicles which is false, deceptive or misleading.
SB589, s. 30 9Section 30. 218.01 (3) (a) 20. of the statutes is amended to read:
SB589,12,1610 218.01 (3) (a) 20. Having set up, promoted or aided in the promotion of a plan
11by which motor vehicles are sold or leased to a person for a consideration and upon
12the further consideration that the purchaser or lessee agrees to secure one or more
13persons to participate in the plan by respectively making a similar purchase or lease
14and in turn agreeing to secure one or more persons likewise to join in said plan, each
15purchaser or lessee being given the right to secure money, credits, goods or something
16of value, depending upon the number of persons joining in the plan.
SB589, s. 31 17Section 31. 218.01 (3) (a) 21. of the statutes is amended to read:
SB589,12,2418 218.01 (3) (a) 21. Being a dealer who keeps open the dealer's place of business
19on Sunday for the purpose of buying, leasing or selling motor vehicles; but nothing
20in this subdivision shall apply to any person who conscientiously believes that the
217th day of the week, from sunset Friday to sunset Saturday, should be observed as
22the Sabbath and who actually refrains from conducting or engaging in the business
23of buying, leasing, selling or offering for lease or sale motor vehicles, or performing
24other secular business on that day.
SB589, s. 32 25Section 32. 218.01 (3) (a) 25. of the statutes is amended to read:
SB589,13,1
1218.01 (3) (a) 25. Having violated chs. 421 to 427 or 429.
SB589, s. 33 2Section 33. 218.01 (3) (a) 29. of the statutes is amended to read:
SB589,13,53 218.01 (3) (a) 29. Being an inactive business, as evidenced by 3 or less motor
4vehicle purchases and sales or consumer leases during the prior year licensing
5period.
SB589, s. 34 6Section 34. 218.01 (3) (bf) 1. of the statutes, as affected by 1995 Wisconsin Act
727
, is amended to read:
SB589,13,168 218.01 (3) (bf) 1. The department of transportation shall not license as a dealer
9an applicant for the sale or lease of motor vehicles at retail unless such applicant
10owns or leases a vehicle display lot and a permanent building wherein there are
11facilities to display automobiles and motorcycles and facilities to repair functional
12and nonfunctional parts of motor vehicles and where replacement parts, repair tools
13and equipment to service motor vehicles are kept, and at which place of business
14shall be kept and maintained the books, records and files necessary to conduct the
15business. A residence, tent or temporary stand is not a sufficiently permanent place
16of business within the meaning of this paragraph.
SB589, s. 35 17Section 35. 218.01 (5) (a) of the statutes is amended to read:
SB589,14,218 218.01 (5) (a) The licensor shall promote the interests of retail buyers and
19lessees
of motor vehicles relating to default, delinquency, repossession or collection
20charges and the refund of the finance charge and insurance premium on prepayment
21of the instalment contract or consumer lease. It may define unfair practices in the
22motor vehicle industry and trade between licensees or between any licensees and
23retail buyers, lessees or prospective lessees of motor vehicles, but may not limit the
24price at which licensees may sell, assign or transfer receivables, contracts or other

1evidence of any obligation arising out of an instalment sale or consumer lease made
2under this section.
SB589, s. 36 3Section 36. 218.01 (6) (b) (intro.) of the statutes, as affected by 1995 Wisconsin
4Act 27
, is renumbered 218.01 (6) (b) and amended to read:
SB589,14,205 218.01 (6) (b) Prior to or concurrent with any instalment sale, the seller shall
6deliver to the buyer a written statement describing clearly the motor vehicle sold to
7the buyer, the cash sale price, the cash paid down by the buyer, the amount credited
8the buyer for any trade-in and a description of the trade-in, the cost to the retail
9buyer of any insurance, the amount financed which may include the cost of
10insurance, sales and use taxes, the amount of the finance charge, the amount of any
11other charge specifying its purpose, the total of payments due from the buyer, the
12terms of the payment of such total, the amount and date of each payment necessary
13finally to pay the total and a summary of any insurance coverage to be effected. The
14division of banking may determine the form of the statement. If a written order is
15taken from a prospective purchaser in connection with any instalment sale, the
16written statement shall be given to the purchaser prior to or concurrent with the
17signing of the order by the purchaser. The finance charge in a retail instalment sale
18made prior to April 6, 1980, however computed, excluding the cost of insurance shall
19not exceed the amount computed on the basis of the following annual percentage
20rates:
SB589, s. 37 21Section 37. 218.01 (6) (b) 1. to 8. of the statutes are repealed.
SB589, s. 38 22Section 38. 218.01 (6) (bm) and (bn) of the statutes are repealed.
SB589, s. 39 23Section 39. 218.01 (6) (bp) of the statutes is amended to read:
SB589,15,324 218.01 (6) (bp) A retail instalment sale made after October 31, 1984, is not
25subject to any maximum finance charge limit rate. The maximum allowable finance

1charge shall be computed on the declining principal balance of the amount financed
2as determined under par. (b) at the annual percentage rate, disclosed pursuant to
3subch. III of ch. 422, according to the actuarial method as defined in s. 421.301 (1)
.
SB589, s. 40 4Section 40. 218.01 (6) (d) of the statutes is amended to read:
SB589,15,85 218.01 (6) (d) A violation of par. (a), (b), (bm), (bn), or (bp) or (k) bars recovery
6of any finance charge by the seller, or an assignee of the seller who, at the time of the
7assignment, had knowledge of the violation, in any suit upon a sales contract arising
8from the sale where the violation occurred.
SB589, s. 41 9Section 41. 218.01 (6) (j) of the statutes is repealed.
SB589, s. 42 10Section 42. 218.01 (6x) of the statutes is created to read:
SB589,15,1311 218.01 (6x) Prelease agreements. (a) Every prelease agreement shall be in
12writing, which shall contain all of the agreements of the parties with respect to
13entering into a consumer lease and shall be signed by both parties.
SB589,15,1514 (b) No prelease agreement shall be binding on a prospective lessee unless all
15of the following apply:
SB589,15,1816 1. All of the information required to be disclosed under par. (d) or in a consumer
17lease under s. 429.203 (3) and (4) is disclosed in writing to the prospective lessee
18before the execution of the prelease agreement by the prospective lessee.
SB589,15,2119 2. The prelease agreement contains, directly above the place for the prospective
20lessee's signature, a notice in substantially the following language in bold-faced
21capital letters of not less than 10-point type:
SB589,15,2222 NOTICE TO PROSPECTIVE LESSEE
SB589,16,323 a. THIS IS A BINDING PRELEASE AGREEMENT. BY SIGNING THIS
24AGREEMENT, YOU WILL BECOME OBLIGATED TO ENTER INTO AN
25AGREEMENT WITH THE PROSPECTIVE LESSOR TO LEASE THE VEHICLE

1DESCRIBED IN THIS AGREEMENT WHEN IT IS AVAILABLE AND READY TO
2BE DELIVERED TO YOU, UPON LEASE TERMS DISCLOSED IN THIS
3AGREEMENT OR IN THE ATTACHED DISCLOSURE STATEMENT, IF ANY.
SB589,16,54 b. DO NOT SIGN THIS AGREEMENT BEFORE YOU READ IT, INCLUDING
5THE WRITING ON THE REVERSE SIDE.
SB589,16,66 c. DO NOT SIGN THIS IF IT CONTAINS ANY BLANK SPACES.
SB589,16,87 d. YOU ARE ENTITLED TO AN EXACT COPY OF ANY AGREEMENT YOU
8SIGN.
SB589,16,169 (c) An exact copy of the prelease agreement shall be furnished by the
10prospective lessor to the prospective lessee at the time that the prospective lessee
11signs the agreement. The prospective lessee's copy of the agreement shall contain
12the signature of the prospective lessor identical with the signature on the original
13contract. No agreement shall be signed in blank except that a detailed description
14of the motor vehicle, including the serial number or other identifying marks of the
15vehicle, that is not available at the time of execution of such agreement may be
16omitted.
SB589,16,2217 (d) A prospective lessor may cancel a prelease agreement that is contingent
18upon approval of the prospective lessee's credit by a sales finance company to whom
19the prospective lessor intends to assign the consumer lease, if the agreement
20contains a provision requiring the prospective lessor to give the prospective lessee
21written notice of such cancellation within 10 business days of execution of the
22agreement and the notice is given to the prospective lessee.
SB589,17,223 (e) No prelease agreement may contain a clause which, upon nonacceptance of
24the vehicle by the prospective lessee, would subject the prospective lessee to a

1penalty greater than 5% of the capitalized cost, as defined in s. 429.104 (5), of the
2vehicle.
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