New Jersey Retail Installment Sales Act

The effect of the enactment of the New Jersey bill is that a “retail buyer” may now assert against an assignee of the installment contract or subsequent “holder” of the negotiable note any defenses he has against the retail installment seller. The new law would appear to be one of the most comprehensive laws of its type to be enacted. However, the draftsmen apparently left a significant loophole, appropriately termed the “specious cash sale,” which, if exploited, could negate the intended effect of the new law. This note will analyze the bill, compare it with the relevant provisions of the National Consumer Act (NCA) and the Uniform Consumer Credit Code (UCCC), and will discuss the loophole and the ways it can be closed.