§ 6325. Purchase money loan; notice.

217 words·~1 min read·/pa/title-12/chapter-63/6325

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

(a)General rule.-- Unless an instrument that evidences or embodies a debt arising from a purchase money loan contains the notice under subsection (b):

(1)a purchase money lender may not take or receive the instrument; and

(2)a seller may not accept the proceeds of the purchase money loan as full or partial payment for the sale.

(b)Notice.-- An instrument under subsection

(a)shall contain the following notice:

NOTICE

A holder of this agreement is subject to all the claims and defenses that the buyer could assert against the seller of goods or services obtained with the proceeds of this agreement. Recovery under this agreement by the buyer may not exceed the amount paid by the buyer under the agreement.

(c)Definitions.-- As used in this section, the following words and phrases shall have the meanings given to them in this subsection:

"Purchase money lender." Either a seller or financing agency making or extending a purchase money loan.

"Purchase money loan." An advance that is received by a buyer in return for a finance charge or interest that is applied to a purchase of goods or services from a seller who is affiliated, by common control or business arrangement, with the person extending the credit to the buyer.

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