Massachusetts House Bill H4925

Massachusetts 2023-2024 Regular Session

• Introduced: 7/29/24
• Refer: 7/29/24

Caption

Relative to motor vehicle debt waivers

Impact

If enacted, H4925 would significantly influence consumer protection laws in Massachusetts by formalizing the obligations of creditors regarding debt waivers. Creditors would have to provide clear disclosures about these waivers, including terms for cancellation and refund processes. Additionally, the bill mandates insurance requirements for debt waiver obligations, requiring creditors and retail sellers to insure these obligations adequately. This provision aims to reinforce consumer trust and ensure that borrowers are protected from potential losses associated with debt waivers.

Summary

House Bill 4925, titled 'An Act relative to motor vehicle debt waivers', aims to establish regulations concerning debt waivers for motor vehicle finance agreements. The bill introduces definitions for various terms such as 'borrower', 'creditor', and 'debt waivers', ensuring clarity in the types of protections offered to consumers. One of the key components of the bill is the introduction of 'Guaranteed Asset Protection Waivers (GAP Waivers)' and 'Excess Wear and Use Waivers', which allow borrowers some relief in case of total loss or excessive wear of vehicles. These waivers are intended to mitigate the financial burden on consumers who face unexpected losses related to their motor vehicle finance agreements.

Contention

Discussion around H4925 has highlighted some points of contention. Supporters of the bill argue that these regulations are necessary for consumer protection, ensuring that consumers are provided with relevant information and protections when signing motor vehicle finance agreements. Critics, however, might express concern regarding the potential for increased costs for creditors, which could be passed down to consumers. They may also question whether the additional regulatory framework could create barriers for retail sellers and creditors in offering competitive financial products.