Massachusetts General Laws
Chapter 255d - Retail Installment Sales and Services
Section 18 - Subsequent Add-on Purchases; Consolidated Agreement; Payments; Termination of Security Interest

Section 18. A. If a buyer purchases goods or services from a seller from whom he has previously purchased goods or services under one or more retail installment sale agreements, and the amounts due under any such previous agreement have not been fully paid, any such subsequent purchase may, by agreement of the parties, be added on to one or more of the previous agreements. Each subsequent add-on purchase shall be a separate retail installment sale agreement subject to all the provisions of this chapter with respect to retail installment sale agreements except that in lieu of the buyer executing a retail installment sale agreement as provided in this chapter, the seller shall, before the due date of the first installment under the consolidated agreement, prepare and deliver to the buyer, or the buyer shall otherwise have in his possession at the time of the subsequent purchase, a written memorandum, sales slip or an account book, or any combination thereof, setting forth with respect to each subsequent purchase all information and items required by section nine, the outstanding balance of the previous agreement or agreements and the consolidated total of payments owed with the number of installments required to pay it, and the amount and time of each payment, in which information the amounts and times of installment payments need not be separately stated if the amount of and time between payments are substantially equal and the amount of the scheduled final installment payment may be stated as the remaining unpaid balance. The consolidated total of payments to be paid by the buyer in the new schedule of installments shall include unpaid total of payments.
If a finance charge imposed at the time of any subsequent add-on purchase is based in whole or in part upon an outstanding balance of a previous agreement, due regard shall be given to the refund credit as provided in section thirteen in determining that outstanding balance.
In the event of prepayment in full of a consolidated agreement where a finance charge was not imposed based in whole or in part upon an outstanding balance of a previous agreement or agreements, due regard shall be given for any refund credit not theretofore computed and given for each previous agreement.
B. If debts arising from two or more retail instalment sale agreements or sales under revolving credit agreements are consolidated into one debt payable on a single schedule of payments, and the debt is secured by security interests taken with respect to one or more of the sales, payments received by the seller or holder after the consolidation are deemed, for the purpose of determining the amount of the debt secured by the various security interests, to have been first applied to the payment of the debts arising from the sales first made. To the extent debts are paid according to this section, security interests in items of property terminate as the debts originally incurred with respect to each item is paid. If the debts consolidated arose from two or more sales made on the same day, payments received by the seller are deemed, for the purpose of determining the amount of the debts secured by the various security interests, to have been applied first to the payment of the smallest debt.

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