476-24 Additions to and consolidations of credit sale contracts. Where a buyer makes any subsequent purchases of goods from a seller from whom the buyer has previously purchased goods under one or more credit sale contracts which provide for the extension of closed-end credit, and the amounts under the contract or contracts have not been fully paid, the previous purchases may be included in and consolidated with one or more of the subsequent contract or contracts, or the subsequent purchases may be included in and consolidated with one or more of the prior contract or contracts in which case a memorandum of such additional purchases shall be prepared by the seller and inserted in or attached to the seller's counterpart of the contract. The memorandum shall set forth:

(1) A description of the additional goods so purchased;

(2) The consolidated total indebtedness of the buyer;

(3) The finance charge which shall include any unearned portion of the old finance charge that is not credited to the prior contract or contracts;

(4) The annual percentage rate; and

(5) The revised installment payments.

A copy of the memorandum shall be furnished to the buyer prior to the due date of the first installment following the subsequent purchase.

Every memorandum which complies with the disclosure requirements of the federal Truth in Lending Act as of the date upon which the contract is executed shall be deemed to comply with the disclosure provisions of this section.

When such subsequent purchase is made, the entire amount of all payments made previous to the subsequent purchase shall be applied toward the payment of the previous purchase or purchases and each payment thereafter received shall be first applied to the payment of purchases first made. To the extent purchases are paid for according to this section, security interests in the goods which are the subject matter of the credit sale shall terminate as the payment with respect to each purchase is made.

Unless otherwise expressly stated in the contract, payments received by the seller upon a revolving charge account shall be applied first to the payment of finance charges, then to late charges, costs of action, and attorney's fees in the order of their entry to the account, and then to the payment of purchases in the order in which the entries to the account showing the purchases were made. [L 1961, c 102, pt of 1; Supp, 201A-28; am L 1967, c 285, 7; HRS 476-29; am L 1970, c 54, 1; am and ren L 1984, c 86, pt of 1]

 

Revision Note

 

In third paragraph, "this section" substituted for "section 476-24".

In fourth paragraph, "credit" substituted for "retail installment".

 

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