La. Admin. Code tit. 46 § V-7711

Current through Register Vol. 50, No. 11, November 20, 2024

Section V-7711 - Debt Waiver or Debt Forgiveness Requirements

A. The retail installment sales contract must have an addendum where upon the extender of credit agrees to waive the consumers debt for the difference between the amount paid by the consumers primary insurance and the net payoff of the contract.

B. There shall be a clear statement in the waiver form that is given to the consumer that the consumer's debt is waived. The following is an example:

The extender of credit hereby agrees, by acceptance of this Addendum as an amendment to the Retail Installment Sales Contract upon assignment, to waive the consumers liability for the difference between the amount owed (excluding past due amounts, payment extensions, insurance or other charges) under the consumers retail installment sales contract and the actual cash value of the consumers vehicle as of the date of the total loss of the consumers vehicle resulting from a peril covered by the consumers primary insurance company.

C. The consumer shall have the right to cancel the debt waiver or debt forgiveness agreement and shall be entitled to a refund of the premium paid no less favorable to the consumer than the rule of 78's or pro-rata.

D. The agreement shall contain a statement of how the unpaid net balance is determined. In making this determination, unearned interest, loan charges, late charges, any delinquent payments, any uncollected service charges, refundable prepaid taxes or fees or any other proceeds the consumer may recover by cancelling insurance coverages, service contracts or warranties, disposition fees, termination fees, penalty fees or other items built into or added to the initial loan balance are not covered by the agreement.

E. There shall be no deductible provision in the agreement.

F. There may be a limited waiver of subrogation which shall apply only to sums actually paid or waived on behalf of the consumer.

G. The claim shall be paid within 60 days of the incident or 30 days from filing of the police report.

La. Admin. Code tit. 46, § V-7711

Promulgated by the Office of the Governor, Motor Vehicle Commission, LR 31:925 (April 2005).

AUTHORITY NOTE: Promulgated in accordance with R.S. 6:969.40(D).