GNYADA 2019 Membership Directory & Services Guide

Therefore, they generally are not considered cosigners under the Rule, and you are not required to provide the cosigner notice to them. A classic example of a cosigner is a parent cosigning for their child’s credit obligation. Many states have additional requirements for cosigner notices so check with your local attorney on the cosigner notice required in your state. Recall that when two applicants for credit apply for financing, they are required to indicate on the credit application whether or not they intend to apply for joint credit. Reservation/Pre-Purchase Agreements Many dealers have embraced the technology and convenience of online sales. Some may charge a fee to potential buyers looking to reserve or “pre-purchase” a vehicle before they have an opportunity to test drive the vehicle or fully negotiate their deal.You should carefully reviewany proposed reservation process with your counsel to ensure compliance with any state laws and regulations impacting these types of arrangements, such as cancellability, fee restrictions and refunds, disclosures, and blue laws. And of course, be mindful of state and federal UDAP laws and dealer advertising regulations. Electronic Signatures and Records The federal Electronic Signatures in Global and National Commerce Act (the E-SIGN Act) and the state-adopted Uniform Electronic Transactions Act (UETA) were enacted to resolve uncertainty about whether electronic documents and signatures are as valid as paper ones. Both acts provide that electronic records and signatures have the same legal status as ink signatures and paper records. Under both, an “electronic record” is information “that is stored in an electronic or other medium and is retrievable in perceivable form” and an “electronic signature” is “an electronic sound, symbol, or process, attached to or logically associated with a contract or other record and executed or adopted by a person with the intent to sign the record.” Neither act changes the disclosure or content requirements for documents under other law. The E-SIGN Act requires that consumers specifically consent to receiving disclosures that are required to be “in writing” electronically and provides specific requirements for obtaining such consent. Alternatively, one can provide such disclosures in paper form and avoid the consent procedure imposed by the E-SIGN Act. Please note that because of limitations in their scope, the E-SIGN Act and UETA do not alter the documentation and signature requirements of Uniform Commercial Code Article 9, which provides the requirements for the customer to grant the creditor a security interest in the vehicle sold. Fortunately, Article 9 permits the use of electronic records and signatures to grant a security interest in substantially the same way as the E-SIGN Act and UETA would. So the electronic records and signatures used in the customer’s financing contract that satisfy the E-SIGN Act and UETA requirements will also satisfy the Article 9 requirements for the contract. As a result, a consumer’s digital signature on an electronic signature pad linked to an electronic document or their digital signature on a tablet used to provide the documents has the same legal effect as their ink signature on a paper document. A click-through to a website can also be an electronic signature. The electronic document can be stored in an electronic filing cabinet or vault and should be retained for a period of time equal to the retention period for a paper version of the same document. Under TILA, the consumer must receive a copy of the disclosures that the consumer can keep prior to the consummation of the transaction. See more in Chapter 11: Recordkeeping and Destruction of Records.

2019 membership directory & services guide / hot topics

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