§ 25A-2. "Consumer credit sale" defined.
§ 25A‑2. "Consumercredit sale" defined.
(a) Except as providedin subsection (c) of this section, a "consumer credit sale" is a saleof goods or services in which
(1) The seller is onewho in the ordinary course of business regularly extends or arranges for theextension of consumer credit, or offers to extend or arrange for the extensionof such credit,
(2) The buyer is anatural person,
(3) The goods orservices are purchased primarily for a personal, family, household oragricultural purpose,
(4) Either the debtrepresenting the price of the goods or services is payable in installments or afinance charge is imposed, and
(5) The amount financeddoes not exceed seventy‑five thousand dollars ($75,000) or, in the caseof a debt secured by real property or a manufactured home as defined in G.S.143‑145(7), regardless of the amount financed.
(b) "Sale"includes but is not limited to any contract in the form of a bailment or leaseif the bailee or lessee contracts to pay as compensation for use a sumsubstantially equivalent to or in excess of the aggregate value of the goodsand services involved, and it is agreed that the bailee or lessee will become,or for no other or for a nominal consideration, has the option to become, theowner of the goods and services upon full compliance with his obligations undersuch contract.
The term also includes acontract in the form of a terminable bailment or lease of goods or services inwhich the bailee or lessee can renew the bailment or lease contractperiodically by making the payment or payments specified in the contract if:
(1) The contractobligates the bailor or lessor to transfer ownership of the property to thebailee or lessee for no other or a nominal consideration (no more than tenpercent (10%) of the cash price of the property at the time the bailor orlessor initially enters into the contract with the bailee or lessee) upon themaking of a specified number of payments by the bailee or lessee; and
(2) The dollar total ofthe specified number of payments necessary to exercise the purchase option ismore than ten percent (10%) in excess of the aggregate value of the propertyand services involved. For the purposes of this subsection, the value of goodsshall be the average cash retail value of the goods. The value of servicesshall be the average retail value, if any, of such services, as determined bysubstantial cash sales of such services. If a contract is found to be a saleunder this subsection, these values shall be used to determine the amountfinanced for purposes of G.S. 25A‑15.
(c) A sale in which theseller allows the buyer to purchase goods or services pursuant to a credit cardissued by someone other than a seller that is engaged in part or entirely inthe business of selling goods or services or similar arrangement is not aconsumer credit sale. A sale in which the seller allows the buyer to purchasegoods or services pursuant to a credit card issued by the seller, a subsidiaryor a parent corporation of the seller, a principal supplier of the seller or anycorporation having shareholders in common with the seller holding over twenty‑fivepercent (25%) of the voting stock in each corporation is a consumer credit salewithin the terms of this Chapter.
(d) For the purposes ofthis Chapter, a consumer credit sale shall be deemed to have been made in thisState, and therefore subject to the provisions of this Chapter, if the selleroffers or agrees in this State to sell to a buyer who is a resident of thisState, or if such buyer accepts or makes the offer in this State to buy,regardless of the situs of the contract as specified therein.
Any solicitation orcommunication to sell, oral or written, originating outside of this State, butforwarded to and received in this State by a buyer who is a resident of thisState, shall be deemed to be an offer or agreement to sell in this State.
Any solicitation orcommunication to buy, oral or written, originating within this State, from abuyer who is a resident of this State, but forwarded to and received by aretail seller outside of this State, shall be deemed to be an acceptance oroffer to buy in this State.
(e) If an advertisementfor a terminable bailment or lease defined as a sale in subsection (b) abovestates the amount of any payment, the advertisement must also clearly andconspicuously state the following items, as applicable:
(1) A statement that thetransaction advertised is a lease;
(2) The total amount ofperiodic payments necessary to acquire ownership or a statement that theconsumer has the option to purchase the property and at what time;
(3) That the consumeracquires no ownership rights if either the property is not leased for the termrequired for ownership to transfer or the terms of purchase are not otherwisesatisfied.
If an advertisement for a terminablebailment or lease defined as a sale in subsection (b) above refers to the rightto acquire ownership, the advertisement must clearly and conspicuously statewhether or not the consumer may terminate the lease at any time without penaltyand that the consumer acquires no ownership rights if either the property isnot leased for the term required for ownership to transfer or the terms ofpurchase are not otherwise satisfied.
No one shall advertise inconnection with any terminable bailment or lease defined as a sale insubsection (b) above the ownership option as a means of deceiving any lesseeinto believing that he is purchasing the item of personal property. (1971, c. 796, s. 1; 1979, c.706, s. 1; 1981, c. 970, s. 2; 1983, c. 686, ss. 2, 3; 1987, c. 282, s. 5;1991, c. 602, s. 1; 2005‑338, s. 2.)