Section 8-25-3 Prohibited provisions. - Alabama Statutes

Section 8-25-3

Prohibited provisions.

A rental-purchase agreement shall not contain a provision:

(1) Requiring a confession of judgment;

(2) Authorizing a merchant or agent of the merchant to commit a breach of the peace while repossessing merchandise;

(3) Waiving a defense, counterclaim, or right the consumer may have against the merchant or an agent of the merchant; or

(4) Requiring the purchase of insurance or waiver of liability from the merchant to cover the merchandise; provided, however, that the lessor may offer to the lessee any such insurance or waiver of liability if it is clearly and conspicuously disclosed on the face of the insurance or waiver of liability agreement, in print not less than eight-point bold face type, that the purchase of any such insurance or waiver of liability by the lessee from the lessor is optional. The charge for any insurance or waiver of liability shall not exceed 15 percent of the rental payment.

(Acts 1986, No. 86-497, p. 945, §3; Acts 1991, No. 91-654, p. 1232, §1.)