Law Form Retail Installment Contract, 553, Changed This Month
As you may be aware, the Law Form retail installment contract, commonly known as the 553, was changed this month. Most of the changes will not be apparent, except for one, the insertion of a pre-delivery service fee section along with the Florida statutory disclosure for this fee. This change was Reynolds' effort to respond to dealer requests to solve a problem that had created a cottage industry for plaintiffs' attorneys.
Most decision-makers had been under the impression that dealer fees were itemized only on the buyers orders and were then rolled into the cash price (i.e., line 1) on the finance contract. However, over the last 18 months we learned that many dealers were netting out the dealer fee from line 1 of the finance contract and adding it back in below based on the belief, in some cases correct and others not, that lenders advanced more if the fee is not included in line 1.