Ch. 395                                    1995 LAWS OF MARYLAND

Article - Commercial Law

Section 12-606(b) and 12-1005

Annotated Code of Maryland

(1990 Replacement Volume and 1994 Supplement)

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF
MARYLAND, That the Laws of Maryland read as follows:

Article—Commercial Law

12-609.

(b) (1) A service or other charge not specifically provided for in this section may
not be included in a retail installment sale of a motor vehicle.

(2) This section does not prohibit a seller from financing the cost to the
buyer of a mechanical repair contract sold in connection with a motor vehicle, provided
that the cost of the mechanical repair contract is separately itemized in the financing
agreement.

(3) For purposes of this section, a mechanical repair contract may be sold
only for a vehicle which is covered by an original manufacturer's warranty.

(4) THIS SECTION DOES NOT PROHIBIT A SELLER FROM FINANCING THE
COST TO THE BUYER OF AN OPTIONAL DEBT CANCELLATION CONTRACT WHICH
PROVIDES FOR CANCELLATION OF THE OUTSTANDING BALANCE PAYABLE UNDER
THE INSTALLMENT SALE AGREEMENT IN THE EVENT OF THEFT OR TOTAL
DESTRUCTION OF THE MOTOR VEHICLE AFTER APPLICATION OF THE PROCEEDS OF
ANY INSURANCE MAINTAINED ON THE MOTOR VEHICLE.

12-1012.

(a) This subtitle does not prohibit a credit grantor from including in the loan
amount the cost to the borrower of a mechanical repair contract, provided that the cost of
the mechanical repair contract is separately itemized in the financing agreement. For
purposes of this section, a mechanical repair contract for a motor vehicle may be sold only
for a vehicle which is covered by an original manufacturer's warranty.

(B) THIS SUBTITLE DOES NOT PROHIBIT A CREDIT GRANTOR FROM
INCLUDING IN THE LOAN AMOUNT THE COST TO THE BORROWER OF AN OPTIONAL
DEBT CANCELLATION CONTRACT WHICH PROVIDES FOR CANCELLATION OF THE
REMAINING LOAN BALANCE IN THE EVENT OF THEFT OR TOTAL DESTRUCTION OF
THE COLLATERAL FOR THE LOAN AFTER APPLICATION OF THE PROCEEDS OF ANY
INSURANCE MAINTAINED ON THE COLLATERAL FOR THE LOAN.

[(b)](C) This subtitle does not prohibit a credit grantor, in connection with a loan
to a nonconsumer borrower, from:

(1) Extending or deferring all or any portion of any scheduled payment
under the loan;

(2) Permitting prepayment or refinancing of the loan in whole or in part;

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