Amendments pending in 18 states would require financiers to translate consumer contracts into 300 languages, according to an analysis by the American Financial Services Association. Such translation, AFSA state government affairs committee said in a recent white paper, would impose “a significant burden on the industry.”
Specifically, California, Nevada, and New Mexico have gone beyond the U.S. Civil Rights Act of 1964 to propose or enact legislation or regulations for the contracts, according to the white paper. In fact, AFSA noticed at least 45 bills with contract language requirements pending. In Utah and Maryland, two bills have been passed that feature a number of conditions, including bans on selling auto warranties unless the warranty is written in the borrower’s preferred language and prerequisites that an auto sales contract be available in the language it was negotiated.
Should a lender not comply, the borrower is able to terminate the contract without penalty, AFSA said.
Illinois, New York, and Texas are also taking action in their state legislatures regarding these contracts, AFSA said in the paper. Additionally, lawmakers are mulling action related to contract language requirements in Arizona, Colorado, Georgia, Idaho, Louisiana, Massachusetts, Minnesota, New Jersey, Oregon, Pennsylvania, Virginia, and Washington.
AFSA said in the paper it will encourage “sensible lawmaking” in this area, and will continue to monitor and report developments relevant to its members.
