AN ACT RELATING TO COMMERCIAL LAW -- GENERAL REGULATORY PROVISIONS -- DECEPTIVE TRADE PRACTICES (Prohibits disclosure terms "down payment", "money down", or any similar language to describe lump sum payments in order to reduce monthly lease payments. Provides that lump sum payments are non-refundable in the event of a total loss of the vehicle.)

H8243

2026 -- H 8243
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LC005933
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STATE OF RHODE ISLAND
IN GENERAL ASSEMBLY
JANUARY SESSION, A.D. 2026
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A N A C T
RELATING TO COMMERCIAL LAW -- GENERAL REGULATORY PROVISIONS --
DECEPTIVE TRADE PRACTICES

Introduced By:
Representative Brian C. Newberry

Date Introduced:
March 06, 2026

Referred To:
House Corporations
It is enacted by the General Assembly as follows:
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SECTION 1. Section 6-13.1-28 of the General Laws in Chapter 6-13.1 entitled "Deceptive
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Trade Practices" is hereby amended to read as follows:
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6-13.1-28. Financing of motor vehicles — Term and rate of interest prominently
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displayed.
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(a) Any contract to finance the sale of a motor vehicle shall prominently display the term
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and rate of interest.
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(b) The borrower’s initials or signature shall appear immediately adjacent to the term and
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to the rate of interest on the loan agreement that shall only serve as an acknowledgement that the
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borrower has been informed of the terms and rate. The borrower shall also be required to separately
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sign the loan agreement to bind himself or herself to the contract.
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(c) No contract to finance the lease of a motor vehicle shall use the term "down payment",
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"money down", or any similar language to describe lump sum payments made at the time of
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financing to reduce monthly lease payments. The lessee shall be provided and required to
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acknowledge a plain language disclosure in at least eleven (11) point font that any lump sum money
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paid at the time of financing will not be returned if the vehicle is involved in an incident and
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determined to be a total loss, regardless of the circumstances.
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(c)
(d)
Any agreement to finance a motor vehicle that does not comply with the provision
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of this section shall be voidable within thirty (30) days at the option of the borrower; provided,

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however, the borrower shall be responsible for any damage to the vehicle.
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SECTION 2. This act shall take effect upon passage.
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EXPLANATION
BY THE LEGISLATIVE COUNCIL
OF
A N A C T
RELATING TO COMMERCIAL LAW -- GENERAL REGULATORY PROVISIONS --
DECEPTIVE TRADE PRACTICES
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This act would prohibit leasing disclosures to use terms such as, "down payment", "money
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down", or any similar language to describe lump sum payments made to reduce monthly lease
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payments. This act would provide that the lessee be notified that, in the event of a total loss of the
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motor vehicle, any lump sum payments made are non-refundable, regardless of the circumstances.
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This act would take effect upon passage.
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LC005933
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LC005933 - Page 3 of 3