Wis. Admin. Code Department of Transportation § Trans 139.05 - Motor vehicle purchase contract

(1) USAGE. All dealer and salesperson licensees shall furnish retail purchasers with a copy of a document clearly entitled "Motor Vehicle Purchase Contract" that clearly notifies the prospective retail purchaser on its face that the purchaser is making an offer to purchase that shall become a binding motor vehicle purchase contract if accepted by the dealer licensee, that the dealer licensee shall accept or reject the offer within 2 working hours or the offer is automatically voided and that the offer or may rescind the offer unless and until accepted by the dealer licensee. Until acceptance or rejection of the offer, the licensee shall be prohibited from selling the vehicle to any other party.

(a) An exact copy of the motor vehicle offer to purchase shall be provided to the purchaser at the time the offer is signed by the purchaser except in the case where the offer has not left the presence of the purchaser and is accepted by the dealer in the presence of the purchaser. In addition, whenever a motor vehicle offer to purchase is signed and accepted by a dealer, becoming a binding motor vehicle purchase contract, an exact copy of the purchase contract shall be provided to the purchaser. Any changes to the offer to purchase after signing by the purchaser, or to the purchase contract subsequent to dealer acceptance, shall be made in one of the following manners:

1. All parties shall notate and initial all copies of the original documents.

2. A motor vehicle dealer shall prepare a replacement contract indicating that it replaces the original contract documents. The motor vehicle dealer shall retain the original contract documents in the manner required by s. Trans 138.04(1) (e). Making material changes to the replacement contract without direct oral disclosure of those changes to the purchaser is an unfair sales practice.

(b) A motor vehicle offer to purchase or purchase contract shall be executed whenever the dealer licensee accepts a down payment, deposit or title for trade-in unit from a prospective retail purchaser.

(2) CONTRACT FACE REQUIREMENTS. A contract or offer to purchase shall, on its face:

(a) Clearly identify the names and addresses of the dealer licensee and purchaser.

(b) Describe both the motor vehicle purchased and the trade-in vehicle by year, make, model, identification number and specify whether the purchased vehicle is new, used, or executive or demonstrator.

(c) State the date and time each necessary signature is affixed.

(d) Include the salesperson's name and license number in an area other than where signed by the purchaser and dealer or authorized representative.

(e) Specify an anticipated delivery date on the face of the contract and state further in bold face type next to the anticipated delivery date that: "REGARDLESS OF REASON, IF THE VEHICLE ORDERED BY THE PURCHASER IS NOT AVAILABLE FOR DELIVERY WITHIN 15 CALENDAR DAYS AFTER ANTICIPATED DELIVERY DATE, THE PURCHASER MAY CANCEL THIS ORDER AND SHALL WITHIN ONE BUSINESS DAY, RECEIVE A FULL REFUND OF ANY DOWN PAYMENT AND RETURN OF TRADE-IN VEHICLE, OR TITLE FOR TRADE-IN VEHICLE, OR BOTH. IF THE TRADE-IN IS NOT AVAILABLE, THE PURCHASER SHALL RECEIVE THE TRADE-IN ALLOWANCE. UNLESS DELIVERY DATE IS OTHERWISE QUALIFIED ON THE PURCHASE CONTRACT BY THE PURCHASER, IF THE ORDERED VEHICLE BECOMES AVAILABLE FOR DELIVERY PRIOR TO THE STATED ANTICIPATED DELIVERY DATE, THE DEALER LICENSEE MAY REQUIRE ACCEPTANCE NOT LESS THAN 21 CALENDAR DAYS AFTER HAVING NOTIFIED THE PURCHASER OF AVAILABILITY OF DELIVERY AND MAY SUBSEQUENTLY VOID THE CONTRACT IF THE PURCHASER REFUSES TO TAKE DELIVERY, IN WHICH CASE NO PENALTY SHALL BE ASSESSED BY THE DEALER LICENSEE FOR NON-ACCEPTANCE OF DELIVERY PRIOR TO THE STATED ANTICIPATED DELIVERY DATE." Notification of availability of delivery and penalty for non-acceptance by the dealer licensee to the purchaser shall be by registered or certified mail, return receipt required.

(f) Reference all warranties and service contracts in the following language:

"WARRANTY INFORMATION

Check aplicable boxes. Refer to separate document for cover ages and exclusions

See Image

(fm) If a motor vehicle dealer proposes to use any language in the purchase contract that differs from that shown in par. (f), the dealer shall submit the proposed language to the department. The department shall respond to the dealer within 30 days of receiving the proposed language as to whether the dealer may use the proposed language. The dealer may not modify the proposed language prior to receiving approval from the department to use the proposed language.

(g) State the price due on acceptance of delivery of the vehicle and contain an itemized calculation of the price. The itemized calculation of the price shall state the manufacturer's suggested retail price, if the vehicle is a new vehicle, or the price stated on the Wisconsin Buyer's Guide, if the vehicle is a used vehicle, and all additional charges, mark-ups, mark downs, discounts or other adjustments made to arrive at the price due upon acceptance of delivery, including where applicable, but not limited to, delivery charges, sales tax, license and title fees, down-payment, owned trade-in allowance, positive or negative leased trade-in allowance and estimated or actual pay-off amount, or estimated or actual lease buy-out amount as permitted under sub. (8g) for any loan secured by a trade-in vehicle. Rebates shall be referenced separately by dollar amount and assignment. The itemized calculation of the vehicle's price shall be made on the face of the purchase contract, except that the components of the total manufacturer's suggested retail price may be provided by reference to the vehicle's window label or in an attachment to the purchase contract. The use of an attachment does not alter dealer's responsibility to comply with s. Trans 139.04(2) (a). The purchaser is not required to sign the dealer's attachment to the purchase contract.

(h) Specify all disclosures required in s. Trans 139.04(1) (b), (2) (a), and (5) (b).

(i) Immediately above the contract signature block, make specific reference to any penalty which may be assessed to the purchaser for non-acceptance of the vehicle. The penalty may not exceed 5% of the cash price as provided by s. 218.0141, Stats.

(j) Clearly state financing contingencies in the manner provided in s. Trans 139.055. If the purchaser is unable to obtain acceptable financing, the purchaser may cancel or rescind the contract and shall, within one business day, receive a full refund of any down-payment, and return of trade-in vehicle, or title for trade-in vehicle, or both, and no penalty shall be assessed. If the trade-in vehicle is not available, the purchaser shall receive the trade-in allowance.

(jm) Include any disclosure required under sub. (6m).

(jr) If the purchase offer is for a vehicle for which the motor vehicle dealer has already executed a purchase contract, the purchase offer shall clearly state that that purchase offer is contingent on the prior executed purchase contract not being completed. Such a contingent purchase offer shall also provide that the purchaser may rescind the offer at any time prior to being notified by the dealer that the prior executed purchase contract was not completed and that the contingency has been removed from the purchaser's contingent purchase offer. If the purchase contract is rescinded or the prior executed purchase contract completed, any downpayment or trade-in shall be returned within one business day.

(k) Specify all other separately negotiated conditions of sale not stated elsewhere on the contract.

(3) RETURN OF DEPOSIT MONIES OR TRADE-IN TITLE. Any down payment, deposit, or title shall be returned to the prospective retail purchaser within 2 working hours from the time the offer to purchase was made if the offer to purchase is not accepted by the dealer licensee. If the prospective purchaser is not present or available during the 2 hour period, those items shall be returned in person or mailed during the following business day.

(4) MOTOR VEHICLE PRICE PROTECTION. A motor vehicle manufacturer, importer or distributor which accepts dealer orders placed on behalf of private retail purchasers shall furnish dealer licensees with price lists upon which retail motor vehicle purchase contracts may be executed. Price lists shall set forth the base prices of the various models along with the prices of all optional equipment, accessories and destination or transportation charges. The prices set forth in the price lists shall remain in effect until receipt by the dealer licensees of written official price change notification which shall contain the specific dollar amounts of increases or revised prices applicable to the various models, optional equipment, accessories and destination or transportation charges.

(a) Price increases imposed by these motor vehicle manufacturers, importers or distributors, are prohibited on those vehicles for which dealers had orders written with private retail purchasers prior to the dealer's receipt of the written official price change notification.

(b) A motor vehicle purchase contract signed by a private retail purchaser and accepted by a dealer licensee shall constitute evidence of an existing order written with a private retail purchaser.

(c) Price increases in instances cited in sub. (5) (b) and (c) 1. shall not be subject to the provisions of this subsection.

(5) MOTOR VEHICLE PRICE CHANGES. A motor vehicle manufacturer, importer or distributor which has adopted a formal policy of not accepting dealer orders placed on behalf of private retail purchasers shall notify franchised dealer licensees and the department of that fact in writing. If the policy is not clearly set forth to franchised dealer licensees, price increases imposed by the motor vehicle manufacturer, importer or distributor are prohibited on those vehicles for which dealers had orders written with private retail purchasers prior to the dealer's receipt of the official price change notification referred to in sub. (4).

(a) In the event of motor vehicle manufacturer, importer or distributor price reduction the amount of any reduction received by a dealer licensee shall be passed on to the private retail purchaser by the dealer if the retail price was negotiated on the basis of the previous higher price to the dealer.

(b) Price increases in the following instances shall not be subject to the price protection and price change provisions of sub. (4) and this subsection:

1. The addition of new equipment as required by state or federal law.

2. In the case of foreign make vehicles, revaluation of the U.S. dollar by the U.S. government.

3. Local, state or federal tax changes.

(c) Any increase in price to a retail purchaser after the dealer has accepted an offer to purchase from the purchaser is an unfair practice and prohibited except as follows:

1. Motor vehicle dealer licensees who accept offers to purchase from private retail purchasers for new vehicles not yet in the dealer's inventory shall, in the following statement to be completed on the purchase contract, check box A where the manufacturer, importer or distributor has a formal policy of not accepting retail orders as described in this subsection, or where the manufacturer's suggested retail price of an ordered vehicle of the upcoming model year is unknown; or check box B where the manufacturer's suggested retail price is unknown as in the case of a newly introduced model: *Order-out vehicle not price protected. (Check A or B)

A. *Current model year price known. If the manufacturer's suggested retail price increases before vehicle delivery, the final cash price shall be the current contract cash price, plus the increase in the manufacturer's suggested retail price adjusted by _________% discount or _________% markup of said increase.

B. *Price of newly introduced model currently unknown. The final cash price shall be the total of the manufacturer's suggested retail price upon delivery plus the price of any dealer installed options set forth in this contract with _________% discount subtracted from or _________% markup added to the total.

However, if the final cash price of either A or B exceeds, the purchaser may cancel the contract without penalty. Also the dealer is not obligated to deliver unless the purchaser agrees to pay the final cash price."

2. A trade-in vehicle may be reappraised if it suffers damage as defined by s. Trans 139.02(2), or parts or accessories have been removed after purchase contract execution. Reappraisal by the dealer licensee shall be limited to an amount equal to the retail repair costs of damages incurred, or to the value of parts or accessories removed. Reappraisal for mileage/kilometers is not allowed unless the dealer has stated on the contract that "The appraisal is based on an odometer reading of up to ________ miles/kilometers, and the trade-in vehicle may be reappraised if it exceeds this limit."

(6) DAMAGE DISCLOSURE. On any new vehicle or demonstrator or executive vehicle, any corrected damage exceeding 6% of the manufacturer's suggested retail price, as measured by retail repair costs, and all uncorrected damage shall be disclosed in writing to the purchaser prior to delivery. Damage to glass, tires, bumpers, moldings or audio equipment is excluded from the 6% rule when replaced by identical manufacturer's original equipment.

(6m) ESTIMATED MILEAGE AT DELIVERY. If a motor vehicle dealer enters into a purchase contract to sell a new vehicle as defined in s. Trans 139.02(11) that is not available at the dealers' location, the dealer shall provide the purchaser with an estimate of vehicle mileage at delivery. The purchase contract shall be cancelable at purchaser's option if the mileage of the vehicle upon delivery exceeds the dealer's estimate. This option ends upon acceptance of delivery. Once acceptance of the vehicle occurs, any purchaser's rights to cancel the purchase contract on the basis of excess mileage over dealer's good faith estimate are waived. The purchase contract shall state in bold face type the following: IF THE MOTOR VEHICLE DEALER AND PURCHASER ENTER INTO A PURCHASE CONTRACT FOR A NEW MOTOR VEHICLE NOT AVAILABLE AT THE DEALER'S LOT, THE DEALER AND PURCHASER AGREE THAT THE VEHICLE MILEAGE UPON DELIVERY WILL NOT EXCEED _____ [LESS THAN]motor vehicle dealer fills in estimated mileage[GREATER THAN] MILES. BEFORE VEHICLE DELIVERY, PURCHASER HAS THE RIGHT TO CANCEL THE PURCHASE CONTRACT IF THE MILEAGE OF THE VEHICLE EXCEEDS THAT AMOUNT.

(7) ORDER LIMITATIONS. It is an unfair practice and prohibited for a dealer licensee to execute a purchase contract for a vehicle or type of motor vehicle unless the dealer licensee reasonably expects to have the ordered vehicle available for delivery by the anticipated delivery date.

(8) SERVICE FEES.

(a) A dealer may assess a purchaser or lessee an additional service fee for completing any sales-related or lease-related vehicle inspection or forms which are required by law or rule if the dealer has made full disclosure of the service fee to the prospective retail customer. The service fee may not be increased after this disclosure but may be reduced. Dealers that choose to charge a purchaser or lessee a service fee shall include the following disclosure on the purchase or lease contract: "A service fee is not required by law, but may be charged to motor vehicle purchasers or lessees for services related to compliance with state and federal laws, verifications and public safety, and must be reasonable." Upon request from a purchaser, the selling dealer shall provide a written disclosure of the services included in this service fee. The Department reserves the right to audit fees to determine whether they are reasonable.

(b) A dealer licensee who has contracted with the department in accordance with the provisions of s. 341.21, Stats., may charge a purchaser a fee in the amount contained in the contract for the dealer's services relating to the processing or distribution of an original or renewal registration or a certificate of title.

(8g) ESTIMATED TRADE-IN LIEN PAYOFF AMOUNTS. When the payoff for a trade-in vehicle is unknown, the dealer may estimate the payoff in the itemization of vehicle price required under sub. (2) (g). Where such an estimate is used, the purchase contract shall provide that the purchaser may rescind the purchase contract if the actual amount needed to pay off all extensions of credit secured by the motor vehicle exceeds the estimated payoff amount used in the itemized calculation of vehicle price by more than 1 payment on the note secured by the trade-in vehicle. The actual difference between the estimated payoff and actual payoff shall be disclosed by the dealer to the purchaser in writing. A purchaser's refusal to accept delivery of a vehicle or agree in writing to waive the payoff difference within 7 days of notification by the dealer that contract contingencies have been met and disclosure of the payoff difference shall rescind the purchase contract. Adjusting the contract price to reflect an actual loan payoff amount is not bushing if the dealer complies with the requirements of this subsection.

(8r) VEHICLE REBATES.

(a) The existence of a manufacturer's or other rebate on a vehicle is a material item in determining the price of the vehicle. A purchase contract shall provide that if, for any reason, a purchaser does not qualify for a rebate that is referenced in the purchase contract as required by sub. (2) (g), the purchaser may rescind the purchase contract unless the dealer discounts the purchase price of the vehicle by the amount of the rebate. If a purchaser does not qualify for a rebate and the dealer will not provide a discount in the amount of the rebate, the dealer shall notify the purchaser in writing of the fact that the purchaser does not qualify for the rebate and notify the purchaser that the contract shall be rescinded unless purchaser, within 7 days, signs a new purchase contract for the vehicle for the new higher contract price. A purchaser's refusal, within 7 days of receiving written notification, to execute a new purchase contract rescinds the original contract. Purchaser's execution of a new contract after disclosure of the fact that purchaser did not qualify for a rebate waives purchaser's objections related to the rebate.

(b) Delivering a motor vehicle to the purchaser without disclosing in writing that the purchaser does not qualify for the rebate in the manner required under par. (a) is "bushing" under sub. (5) (c) unless the dealer provides a discount to the purchaser for the amount of the rebate and delivers the vehicle at the original contract price.

(c) If a manufacturer rebate not referenced in a purchase contract becomes available based on the delivery date of a vehicle, and a retail purchaser qualifies for the rebate at the time of delivery, the rebate shall be awarded to the purchaser and the contract shall be amended accordingly as provided in sub. (1) (a). For purposes of this section, "manufacturer rebate" means a rebate provided by the vehicle manufacturer directly to the purchaser, including when assigned to the motor vehicle dealer, and does not include manufacturer rebates or wholesale incentives to the dealer or manufacturer discounts from the wholesale price to the dealer.

(9) WAIVER. The use of a motor vehicle purchase contract which requires the purchaser to waive any claims the purchaser may have for breach of contract by the licensee is an unfair practice and prohibited.

(10) ADDITIONAL DISCLOSURES. The motor vehicle purchase contract shall clearly state "Contact the selling motor vehicle dealer to discuss any questions or problems about your vehicle or this contract. If you are unable to resolve any disputes with the dealer, you may contact: Division of Motor Vehicles, Dealer Section, Wisconsin Department of Transportation, P.O. Box 7909, Madison, Wisconsin 53707. The Dealer Section licenses motor vehicle dealers and administers the administrative regulations governing consumer protection in vehicle sale transactions, Ch. Trans 139, Wis. Admin. Code."

(11) CONTRACT PROHIBITED. A purchase contract for a used motor vehicle may not be executed with the retail purchaser until the vehicle has been inspected and findings disclosed as required by s. Trans 139.04(4) and (5) unless no inspection is required under s. Trans 139.04(6) (c).

(11m) CONTINGENT PURCHASE CONTRACTS. A motor vehicle dealer who has a signed purchase contract to sell a particular vehicle with a purchaser that is subject to satisfaction of a purchaser's contingency before the purchase contract becomes final may accept purchase offers for that vehicle subordinate to that of the purchaser. Any such subordinate purchase offer shall include the disclosures required by sub. (2) (jr).

(12) ORDER CHANGES. A dealer licensee shall notify a retail purchaser of any information changing the order or delivery of a vehicle, such as a change in options, equipment, price, or anticipated assembly and delivery date. Notification shall be within 3 business days from the date the dealer receives the information.

Notes

Wis. Admin. Code Department of Transportation § Trans 139.05

Cr. Register, March, 1973, No. 207, eff. 4-1-73; am. (1), (3) (e) and (4); r. and recr. (6); cr. (9), Register, June, 1974, No. 222, eff. 7-1-74; am. (7), r. (8), renum. (9) to be (8) and am., cr. (9), Register, April, 1977, No. 256, eff. 5-1-77; renum. from MVD 24.04 and am., Register, December, 1982, No. 324, eff. 1-1-83; emerg. am. (5) (c) 1., eff. 7-22-83; am. (5) (c) 1., Register, May, 1985, No. 353, eff. 6-1-85; renum. (8) to be (8) (a) and am., cr. (8) (b), Register, January, 1997, No. 493, eff. 2-1-97; r. and recr. (2) (f), am. (10) (intro.) and (a), r. (10) (b) to (d), Register, May, 1997, No. 497, eff. 9-1-97; CR 02-028: am. (2) (g) and (8) (a), Register July 2002 No. 559, eff. 8-1-02; correction in (2) (i) made under s. 13.93(2m) (b) 7, Stats., Register July 2002 No. 559; CR 99-135: am. (1) (a), (2) (f), (i), (j), (5) (b) 3., (6), (10) and (11), cr. (1) (a) 1., 2., (2) (jm), (jr), (6m), (8g), (8r) and (11m), r. and recr. (2) (g) Register February 2004 No. 578, eff. 3-1-04; CR 08-029: cr. (2) (fm) Register August 2008 No. 632, eff. 9-1-08.