N.Y. Personal Property Law § 410 – Add-ons to and consolidations of retail instalment contracts and obligations

1. A retail instalment contract or obligation which otherwise conforms to the requirements of this article may contain the promise or agreement of the buyer to pay in substantially equal periodic instalments the consolidated total of the principal balance thereof and the unpaid time balance or balances owing by the buyer under one or more previous contracts or obligations, together with a credit service charge; if it does so:
1. (a) The contract or obligation shall set forth all items required to be disclosed by the act of congress entitled "Truth in Lending Act" and the regulations thereunder, as such act and regulations may from time to time be amended.
2. (b) Subject to the provisions of section four hundred four and to the provisions of paragraph (c) of this subdivision, the credit service charge to be included in such consolidated total may equal but shall not exceed the larger of the amounts determined by applying the credit service charge at the rate or rates agreed to by the buyer:
  1. (1) to the total of the principal balance of the subsequent contract or obligation and the principal balance of any previous contract or obligation included in the consolidated total determined by deducting from the then unpaid time balance thereof any then unearned credit service charge in an amount not less than the refund credit for anticipation provided for in section four hundred eight (computed, however, without the allowance of any minimum earned credit service charge), for the period from the date thereof to and including the date when the final instalment of such consolidated total is payable; or
  2. (2) to the principal balance of the subsequent contract or obligation for the period from the date thereof to and including the date when the final instalment of such consolidated total is payable and, if the due date of the final instalment of such consolidated total is later than the due date of the final instalment of any previous contract or obligation included in the consolidated total, on the time balance then unpaid on such previous contract or obligation from the date when the final instalment thereof was payable to the date when the final instalment of such consolidated total is payable.
3. (c) A consolidation of a retail instalment contract or obligation entered into after the effective date of this paragraph with a retail instalment contract or obligation entered into prior to the effective date of this paragraph shall be governed by the limitations on maximum credit service charges contained in subdivision one of this section and section four hundred four as they were in effect immediately prior to the effective date of this paragraph.
2. Where a buyer makes any subsequent purchase of goods under a contract from a seller from whom he had previously purchased goods under one or more contracts and the amounts due under such previous contract or contracts have not been fully paid, and where the total of the time balance of the subsequent contract and the unpaid time balances owing by the buyer under the previous contracts does not exceed three thousand dollars, such contract, if it otherwise conforms to the requirements of this article, may provide that the goods purchased under the previous contract or contracts shall be security for the goods purchased under the subsequent contract but only until such time as (a) the purchase price under the previous contract or contracts is fully paid, or (b) twenty per centum of the time sale price of the goods purchased under the subsequent contract has been paid, whichever event first occurs.
3. When such subsequent purchase is made, the entire amount of all payments made previous thereto shall be deemed to have been applied toward the payment of the previous purchase or purchases. Each payment thereafter received shall be deemed to be allocated to all of the various purchases in the same proportion or ratio as the original cash sale prices of the various purchases bear to one another; where the amount of each instalment payment is increased in connection with the subsequent purchase, the subsequent payments (at the seller's election) may be deemed to be allocated as follows: an amount equal to the original rate, to the previous purchase, and an amount equal to the increase, to the subsequent purchase. However the amount of any initial or down-payment on the subsequent purchase shall be deemed to be allocated in its entirety to such purchase. The provisions of subdivisions two and three of this section shall not apply to cases involving equipment, parts or other merchandise attached or affixed to goods previously purchased or repairs or services rendered by the seller in connection therewith at the buyer's request.