SB486-SSA1,8,77 consumer credit transactionS
SB486-SSA1,8,88 Subchapter VI
SB486-SSA1,8,99 rental-purchase agreements
SB486-SSA1,8,10 10422.601 Scope. This subchapter applies only to rental-purchase agreements.
SB486-SSA1,8,13 11422.602 General requirements of disclosure. (1) Form, location, size, and
12time of disclosure.
The information that is required to be disclosed under s. 422.603
13shall satisfy all of the following:
SB486-SSA1,8,1414 (a) The information shall be clearly and conspicuously disclosed.
SB486-SSA1,8,1515 (b) The information shall be disclosed in writing.
SB486-SSA1,8,1716 (c) The information shall be disclosed on the face of the rental-purchase
17agreement above the line for the lessee's signature.
SB486-SSA1,8,1818 (d) The information shall be disclosed in not less than 8-point standard type.
SB486-SSA1,8,2019 (e) The information shall be disclosed before the time that the lessee becomes
20legally obligated under the rental-purchase agreement.
SB486-SSA1,8,2321 (f) The disclosures required by s. 422.603 (2), (3), (4), and (5) shall be printed
22in at least 10-point boldface type, and shall be grouped together in a box, in the form
23and order prescribed by the division.
SB486-SSA1,9,3 24(2) Accuracy of disclosure. The information required under s. 422.603 must
25be accurate as of the time that it is disclosed to the lessee. If any information

1subsequently becomes inaccurate as a result of any act, occurrence, or agreement by
2the lessee, the resulting inaccuracy is not a violation of any provision of chs. 421 to
3427 relating to rental-purchase agreements.
SB486-SSA1,9,8 4(3) Copy of rental-purchase agreement. The rental-purchase company shall
5provide the lessee with a copy of the completed rental-purchase agreement signed
6by the lessee. If more than one lessee is legally obligated under the same
7rental-purchase agreement, delivery of a copy of the completed rental-purchase
8agreement to one of the lessees shall satisfy this subsection.
SB486-SSA1,9,12 9(4) Single instrument. In a rental-purchase agreement, the lessee's rental
10payment obligations shall be evidenced by a single instrument, which shall include
11the signature of the rental-purchase company, the signature of the lessee, and the
12date on which the instrument is signed.
SB486-SSA1,9,15 13422.603 Required provisions of rental-purchase agreement. A
14rental-purchase company shall include all of the following information, to the extent
15applicable, in every rental-purchase agreement:
SB486-SSA1,9,19 16(1) Description. A brief description of the rental property, sufficient to identify
17the rental property to the lessee and the rental-purchase company, including any
18identification number, and a statement indicating whether the rental property is
19new or used.
SB486-SSA1,9,25 20(2) Cash price. The price at which the rental-purchase company would sell the
21rental property to the lessee if the lessee were to pay for the rental property in full
22on the date on which the rental-purchase agreement is executed, along with a
23statement that, if the lessee intends to acquire ownership of the rental property and
24is able to pay for the property in full or is able to obtain credit to finance the purchase,
25the lessee may be able to purchase similar property from a retailer at a lower cost.
SB486-SSA1,10,3
1(3) Rental payments to acquire ownership. The total number, total dollar
2amount, and timing of all rental payments necessary to acquire ownership of the
3rental property.
SB486-SSA1,10,10 4(4) Cost of rental services. The difference between the total dollar amount
5of payments necessary to acquire ownership of the rental property disclosed under
6sub. (3), and the cash price of the property disclosed under sub. (2). The
7rental-purchase company shall also include a statement substantially similar to the
8following: "The cost of rental services is the amount you will pay in addition to the
9cash price if you acquire ownership of the rented goods by making all payments
10necessary to acquire ownership."
SB486-SSA1,10,11 11(5) Rental payment. The rental payment for the rental property.
SB486-SSA1,10,15 12(6) Up-front payment. Any payment required of the lessee at the time that the
13agreement is executed or the rental property is delivered, including the initial rental
14payment, any application or processing charge, any delivery fee, and any charge for
15a liability damage waiver or for other optional services agreed to by the lessee.
SB486-SSA1,10,21 16(7) Other charges and fees to acquire ownership. The dollar amount, both
17itemized and in total, of all taxes, liability damage waiver fees, fees for optional
18services, processing fees, application fees, and delivery charges that the lessee would
19incur if the lessee were to rent the rental property until the lessee acquires
20ownership, assuming that the lessee does not add or decline the liability damage
21waiver or optional services after signing the rental-purchase agreement.
SB486-SSA1,11,5 22(8) Total payments to acquire ownership. The total of all charges to be paid
23by the lessee to acquire ownership of the rental property, which shall consist of the
24total dollar amount of all rental payments disclosed under sub. (3), and the total
25dollar amount of all other charges and fees disclosed under sub. (7), along with a

1statement that this is the amount a lessee will pay to acquire ownership of the rental
2property if the tax rates do not change and if the lessee does not add or decline the
3liability damage waiver or optional services after signing the rental-purchase
4agreement. The information required under this subsection shall be printed in at
5least 10-point boldface type.
SB486-SSA1,11,8 6(9) Other charges. An itemized description of any other charges or fees that
7the rental-purchase company may charge the lessee that are not otherwise disclosed
8in the rental-purchase agreement.
SB486-SSA1,11,11 9(10) Summary of early-purchase option. A statement summarizing the terms
10of the lessee's options to acquire ownership of the rental property as provided in s.
11422.606 (2).
SB486-SSA1,11,18 12(11) Responsibility for theft or damage. A statement that, unless otherwise
13agreed, the lessee is responsible for the fair market value of the rental property,
14determined according to the early-purchase option formula under sub. (10), if the
15rental property is stolen, damaged, or destroyed while in the possession of or subject
16to the control of the lessee. The statement shall indicate that the fair market value
17will be determined as of the date on which the rental property is stolen, damaged,
18or destroyed.
SB486-SSA1,12,2 19(12) Service and warranty. A statement that during the term of the rental-
20purchase agreement, the rental-purchase company is required to service the rental
21property and maintain it in good working condition, as long as no other person has
22serviced the rental property. In lieu of servicing the rental property, the
23rental-purchase company may, at its option, replace the rental property. The
24rental-purchase company's obligation to provide service is limited to defects in the

1property not caused by improper use or neglect by the lessee or harmful conditions
2outside the control of the rental-purchase company or manufacturer.
SB486-SSA1,12,5 3(13) Termination at option of lessee. A statement that the lessee may
4terminate the agreement at any time without penalty by voluntarily surrendering
5or returning the rental property in good repair.
SB486-SSA1,12,7 6(14) Right to reinstate. A brief explanation of the lessee's right to reinstate
7a rental-purchase agreement under s. 422.615.
SB486-SSA1,12,15 8(15) Rental, not purchase. A statement that the lessee will not own the rental
9property until the lessee has made all payments necessary to acquire ownership or
10has exercised the lessee's early-purchase option. The rental-purchase company
11shall also include a notice reading substantially as follows: "You are renting this
12property. You will not own the property until you make all payments necessary to
13acquire ownership or until you exercise your early-purchase option. If you do not
14make your payments as scheduled or exercise your early-purchase option, the
15rental-purchase company may repossess the property."
SB486-SSA1,12,19 16(16) Information about rental-purchase company and lessee. The names of
17the rental-purchase company and the lessee, the rental-purchase company's
18business address and telephone number, the lessee's address, and the date on which
19the rental-purchase agreement is executed.
SB486-SSA1,12,24 20(17) Optional services. Space for a specific, separately signed, affirmative
21written indication of the lessee's desire for any optional service for which a charge
22is assessed. The lessee's request must be obtained after a written disclosure of the
23cost of the optional service is made, and the cost and term of such service must be
24listed at or near the signature space.
SB486-SSA1,13,2
1422.604 Prohibited provisions of rental-purchase agreements. A
2rental-purchase agreement may not contain any of the following:
SB486-SSA1,13,3 3(1) Confession. A confession of judgment.
SB486-SSA1,13,6 4(2) Security. A provision granting the rental-purchase company a security
5interest in any property, except rental property delivered by the rental-purchase
6company under the rental-purchase agreement.
SB486-SSA1,13,11 7(3) Repossession. A provision authorizing a rental-purchase company, or an
8agent of the rental-purchase company, to enter the lessee's premises without the
9lessee's contemporaneous permission, or to commit a breach of the peace in the
10repossession of rental property provided by the rental-purchase company under the
11rental-purchase agreement.
SB486-SSA1,13,15 12(4) Waiver. A waiver of a defense or counterclaim, a waiver of any right to
13assert any claim that the lessee may have against the rental-purchase company or
14an agent of the rental-purchase company, or a waiver of any provision of chs. 421 to
15427 relating to rental-purchase agreements.
SB486-SSA1,13,18 16(5) Overpayment. A provision requiring rental payments totaling more than
17the total dollar amount of all rental payments necessary to acquire ownership, as
18disclosed in the rental-purchase agreement.
SB486-SSA1,13,20 19(6) Insurance. A provision requiring the lessee to purchase insurance from the
20rental-purchase company to insure the rental property.
SB486-SSA1,13,21 21(7) Attorney fees. A provision requiring the lessee to pay any attorney fees.
SB486-SSA1,14,3 22422.605 Liability waiver. A rental-purchase company may offer a liability
23waiver to the lessee. The terms of the waiver must be provided to the lessee in
24writing, incorporated into the rental-purchase agreement or on a separate
25document. The face of the writing shall clearly disclose that the lessee is not required

1to purchase the waiver. The fee for the waiver may not exceed 10 percent of the rental
2payment due under the rental-purchase agreement. The lessee shall be entitled to
3cancel the waiver at the end of any rental term.
SB486-SSA1,14,7 4422.606 Lessee's right to acquire ownership. (1) Limits on cash prices.
5The cash price for rental property may not exceed an amount equal to twice the actual
6purchase price of the rental property, including any applicable freight charges, paid
7by the rental-purchase company to a manufacturer or wholesaler.
SB486-SSA1,14,10 8(2) Limits on cost of rental services. The total amount charged by the
9rental-purchase company for the cost of rental services in a rental-purchase
10transaction shall not exceed the cash price of the property.
SB486-SSA1,14,18 11(3) Acquisition of ownership. At any time after the initial rental period, a
12lessee may acquire ownership of the property that is the subject of the
13rental-purchase agreement by tendering an amount not to exceed an amount equal
14to the cash price of the rental property multiplied by a fraction that has as its
15numerator the number of periodic rental payments remaining under the
16rental-purchase agreement and that has as its denominator the total number of
17periodic rental payments. A rental-purchase company may also require the lessee
18to pay any accrued unpaid rental payments and fees.
SB486-SSA1,14,23 19422.607 Unconscionable conduct. The administrator of the division of
20banking in the department of financial institutions shall promulgate rules declaring
21specific conduct in rental-purchase agreements and the collection of accounts and
22property arising therefrom to be unconscionable and prohibiting the use thereof. In
23promulgating such rules, the administrator shall consider, among other things:
SB486-SSA1,14,25 24(1) That the practice unfairly takes advantage of the lack of knowledge, ability,
25experience, or capacity of lessees.
SB486-SSA1,15,2
1(2) That those engaging in the practice know of the inability of lessees to receive
2benefits properly anticipated from the goods or services involved.
SB486-SSA1,15,6 3(3) The fact that the practice may enable rental-purchase companies to take
4advantage of the inability of lessees reasonably to protect their interests by reason
5of physical or mental infirmities, illiteracy, or inability to understand the language
6of the agreement, ignorance or lack of education, or similar factors.
SB486-SSA1,15,7 7(4) That the terms of the transaction require lessees to waive legal rights.
SB486-SSA1,15,10 8(5) That the terms of the transaction require lessees to unreasonably
9jeopardize money or property beyond the money or property immediately at issue in
10the transaction.
SB486-SSA1,15,13 11(6) That the natural effect of the practice is to cause or aid in causing lessees
12to misunderstand the true nature of the transaction or their rights and duties
13thereunder.
SB486-SSA1,15,15 14(7) That the writing purporting to evidence the obligation of the lessees in the
15transaction contains terms or provisions or authorizes practices prohibited by law.
SB486-SSA1,15,17 16(8) Definitions of unconscionability in statutes, rules, rulings and decisions of
17legislative, administrative, or judicial bodies.
SB486-SSA1,15,20 18422.608 Receipts and statements. (1) Receipts. A rental-purchase
19company shall provide a written receipt to the lessee for any payment made by the
20lessee in cash or, upon the request of the lessee, for any other type of payment.
SB486-SSA1,16,4 21(2) Statement due to lessee. Subject to sub. (4), upon the request of a lessee,
22a rental-purchase company shall provide a written statement to the lessee showing
23the lessee's payment history on each rental-purchase agreement between the lessee
24and the rental-purchase company. A rental-purchase company is not required to
25provide a statement covering any rental-purchase agreement that was terminated

1more than one year prior to the date of the lessee's request. A rental-purchase
2company may provide a single statement covering all rental-purchase agreements
3or separate statements for each rental-purchase agreement, at the rental-purchase
4company's option.
SB486-SSA1,16,9 5(3) Statement due to other parties. Subject to sub. (4), upon the written
6request of a lessee, made during the term of or no later than one year after the
7termination of a rental-purchase agreement, a rental-purchase company shall
8provide a written statement to any person designated by the lessee, showing the
9lessee's payment history under the rental-purchase agreement.
SB486-SSA1,16,14 10(4) Fee for statement. A lessee or, if appropriate, a lessee's designee, is entitled
11to receive one statement under subs. (2) and (3) without charge once every 12
12months. A rental-purchase company shall provide an additional statement if the
13lessee pays the rental-purchase company's reasonable costs of preparing and
14furnishing the statement.
SB486-SSA1,16,18 15422.610 Advertising. (1) Disclosure required. Except as provided under
16sub. (2), if an advertisement for a rental-purchase agreement refers to or states the
17amount of a payment for a specific item of property, the advertisement shall also
18clearly and conspicuously state all of the following:
SB486-SSA1,16,1919 (a) That the transaction advertised is a rental-purchase agreement.
SB486-SSA1,16,2120 (b) The total number and total dollar amount of all rental payments necessary
21to acquire ownership of the property.
SB486-SSA1,16,2422 (c) That the lessee does not acquire ownership of the property if the lessee fails
23to make all rental payments or other payments necessary to acquire ownership of the
24property.
SB486-SSA1,17,3
1(2) Exception. Subsection (1) does not apply to any in-store display or any
2advertisement that is published in the yellow pages of a telephone directory or in any
3similar directory of businesses.
SB486-SSA1,17,7 4422.611 Price cards displayed. (1) Price cards generally. Except as
5provided in sub. (2), a card or tag that clearly and conspicuously states all of the
6following shall be displayed on or next to any property displayed or offered by a
7rental-purchase company for rent under a rental-purchase agreement:
SB486-SSA1,17,88 (a) The cash price that a lessee would pay to purchase the property.
SB486-SSA1,17,99 (b) The amount and timing of the rental payments.
SB486-SSA1,17,1110 (c) The total number and total amount of all rental payments necessary to
11acquire ownership of the property under a rental-purchase agreement.
SB486-SSA1,17,1212 (d) The cost of rental services under a rental-purchase agreement.
SB486-SSA1,17,1313 (e) Whether the property is new or used.
SB486-SSA1,17,18 14(2) Exceptions. If property is offered for rent under a rental-purchase
15agreement through a catalog, or if the size of the property is such that displaying a
16card or tag on or next to the property would be impractical, a rental-purchase
17company may make the disclosures required under sub. (1) in a catalog or list, if the
18catalog or list is readily available to prospective lessees.
SB486-SSA1,17,25 19422.612 Referral transactions. (1) Prohibited referral transactions. No
20rental-purchase company may induce any individual to enter into a rental-purchase
21agreement by giving or offering to give a rebate or discount to the individual in
22consideration of the individual's giving to the rental-purchase company the names
23of prospective lessees if the earning of the rebate or discount is contingent upon the
24occurrence of any event that takes place after the time that the individual enters into
25the rental-purchase agreement.
SB486-SSA1,18,7
1(2) Authorized referral transactions. After entering into a rental-purchase
2agreement, a rental-purchase company may give or offer to give a rebate or discount
3to a lessee under the rental-purchase agreement in consideration of the lessee's
4giving to the rental-purchase company the names of prospective lessees. A rebate
5or discount under this subsection may be contingent upon the occurrence of any event
6that takes place after the time that the names are given to the rental-purchase
7company.
SB486-SSA1,18,9 8422.613 Termination of rental-purchase agreement. The termination
9date of a rental-purchase agreement is the earlier of the following:
SB486-SSA1,18,12 10(1) The day specified in the rental-purchase agreement as the day on which
11the rental term ends, unless a different day has been established under the
12rental-purchase agreement.
SB486-SSA1,18,13 13(2) The date on which the lessee voluntarily surrenders the rental property.
SB486-SSA1,18,23 14422.614 Late payment, grace period, and late fees. (1) Late fee
15generally.
If a lessee fails to make any payment when due under a rental-purchase
16agreement or if, at the end of any rental term, the lessee fails to return the rental
17property or to renew the rental-purchase agreement for an additional term, the
18rental-purchase company may require the lessee to pay a late fee. Except as
19provided in sub. (4), this subsection does not apply if the lessee's failure to return
20rental property or failure to renew the rental-purchase agreement at the end of the
21rental term is due to the lessee's exercise of an early-purchase option under the
22rental-purchase agreement or is due to the lessee's making all payments necessary
23to acquire ownership of the rental property.
SB486-SSA1,18,25 24(2) Grace periods. The following grace periods shall apply to rental payments
25made with respect to a rental-purchase agreement:
SB486-SSA1,19,3
1(a) For an agreement that is renewed on a weekly basis, no late fee may be
2assessed for a payment that is made within 2 days after the date on which the
3scheduled payment is due.
SB486-SSA1,19,64 (b) For an agreement that is renewed for a term that is longer than one week,
5no late fee may be assessed for a payment that is made within 7 days after the date
6on which the scheduled payment is due.
SB486-SSA1,19,8 7(3) Collection, application, and limitation of late fees. Late fees are subject
8to all of the following:
SB486-SSA1,19,99 (a) A late fee may not exceed $5 for each past-due rental payment.
SB486-SSA1,19,1110 (b) A late fee may be collected only once on each rental payment due, regardless
11of how long the payment remains past due.
SB486-SSA1,19,1312 (c) Payments received shall be applied first to the payment of any rent that is
13due and then to late fees and any other charges.
SB486-SSA1,19,1514 (d) A late fee may be collected at the time that the late fee accrues or at any time
15afterward.
SB486-SSA1,19,18 16(4) Effect of outstanding late fee on transfer of ownership. A
17rental-purchase company may require payment of any outstanding late fees before
18transferring ownership of rental property to a lessee.
SB486-SSA1,19,22 19422.615 Reinstatement of terminated rental-purchase agreement. (1)
20Reinstatement generally. A lessee may reinstate a terminated rental-purchase
21agreement without losing any rights or options previously acquired if all of the
22following apply:
SB486-SSA1,19,2423 (a) The lessee returned or surrendered the rental property within 7 days after
24the termination of the rental-purchase agreement.
SB486-SSA1,20,5
1(b) Not more than 60 days have passed after the date on which the rental
2property was returned to the rental-purchase company or, if the lessee has paid
3two-thirds or more of the total number of rental payments necessary to acquire
4ownership of the rental property, not more than 120 days have passed since the date
5on which the rental property was returned to the rental-purchase company.
SB486-SSA1,20,9 6(2) Authorized conditions on reinstatement. As a condition of reinstatement
7under this section, the rental-purchase company may require the payment of all
8past-due rental charges, any applicable late fees, a reinstatement fee not to exceed
9$5, and the rental payment for the next term.
SB486-SSA1,20,15 10(3) Effect of repossession on reinstatement. Nothing in this section prohibits
11a rental-purchase company from attempting to repossess rental property upon
12termination of a rental-purchase agreement, but such efforts do not affect the
13lessee's right to reinstate as long as the rental property is repossessed, voluntarily
14returned, or surrendered within 7 days after the termination of the rental-purchase
15agreement.
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