On September 15, Oregon Governor Tina Kotek signed into law House Bill 3178, introducing new requirements for auto dealers in the state. This legislation aims to standardize certain aspects of auto finance transactions, specifically those involving retail installment contracts (RICs) or lease agreements, and ensure clarity in the car-buying process. The law will take effect in 2026.
Key Provisions
House Bill 3178 introduces several changes to the auto finance process in Oregon:
- Plain-Language Disclosures: Auto dealers are now required to provide disclosures in plain language, detailing consumer rights in relation to RICs and lease agreements. These disclosures must be available in Oregon’s top six spoken languages, ensuring that all “buyers” (which are persons purchasing or leasing a motor vehicle) can understand the terms of their transactions.
- Financing Finalization Timeline: The bill reduces the timeframe for dealers to finalize RICs or lease agreements from 14 days to 10 days. This change necessitates a more efficient processing of approvals and requires dealers to adjust their operations accordingly.
- Right to Void: Buyers have a right to void the transaction if the “lender” (which is the person purchasing the RIC or lease agreement from the originating party) does not agree to purchase the RIC or lease agreement on the exact negotiated terms within 10 calendar days after the buyer takes possession of the motor vehicle.
- Notification of Voided Contracts: If a RIC or lease agreement is voided, dealers must notify consumers within two days. This provision mandates timely communication with buyers, ensuring they are informed promptly about the status of their contracts.
- Model Disclosure Form: The Attorney General will provide a model form for the required disclosures, which dealers must use. This form will be available in multiple languages and can be downloaded from the Attorney General’s website.