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SB 1533

MOTOR VEHICLE SALES-LIABILITY

104th Regular Session Introduced by Patrick Joyce

Co-signers are liable only if they actually receive the vehicle, with exemptions for title-listed owners; guarantors pay only after primary collection efforts fail.

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Bill Summary · SB 1533

Summary — SB 1533 (Motor Vehicle Sales — Co‑signer Liability)

Note: The provided document contains text from multiple jurisdictions (Arizona, Illinois, Hawaii) combined into one file. This summary focuses on the motor‑vehicle retail installment sales language (Illinois SB 1533 / amendment to 815 ILCS 375/18), which corresponds to the bill title "MOTOR VEHICLE SALES‑LIABILITY." Please confirm the intended jurisdiction/version if you need a jurisdiction‑specific analysis.

Main purpose

Amend the Motor Vehicle Retail Installment Sales Act to change the scope of liability for persons who sign (co‑sign) a retail installment contract for a motor vehicle, and to restate/confirm existing protections and formal requirements for guarantors.

Key provisions

  • Limits co‑signer liability: A person (other than the seller or holder) who signs a retail installment contract "may be held liable only to the extent that he actually receives the motor vehicle described or identified in the contract." In other words, co‑signers who do not receive the vehicle generally are not automatically liable for the full deferred purchase price.
  • Exception for certain owners: A parent, spouse, or any other person who is listed as an owner of the vehicle on the Certificate of Title who co‑signs the retail installment contract may be held liable for the full deferred payment price even if that co‑signer did not actually receive the vehicle.
  • Guarantor status clarified:
    • A person who signs in the capacity of a guarantor has a secondary (not primary) obligation.
    • The guarantor's obligation arises only after the seller or holder has diligently used ordinary legal means to collect from the primary obligor (buyer) without full payment, or after other conditions such as buyer insolvency or inability to serve process.
    • Guarantor provisions in a contract are invalid unless specific conspicuous language appears below the guarantor's signature and the guarantor signs a separate written "Explanation of Guarantor's Obligation" (must be reproduced in at least 8‑point bold type and include specified statements about scope and timing of obligation).
  • Disclosure to co‑signer: The seller must provide the co‑signer a copy of the retail installment contract and the co‑signer/guarantor statement.

Who is affected

  • Co‑signers and guarantors on vehicle retail installment contracts (individuals who sign with or on behalf of the buyer).
  • Parents or spouses (and any person listed as owner on the Certificate of Title) who co‑sign: remain exposed to full liability per the exception.
  • Vehicle buyers, lenders/sellers/holders, and title‑issuers who will need to update contract forms and disclosure practices.
  • Courts and collection practitioners, who will apply the new liability tests.

Potential impacts

  • Increased protection for many co‑signers who did not receive the vehicle: limits lender recourse against them to situations where they actually received the vehicle (reduces unexpected full liability).
  • Retains broad exposure for certain persons tied to title (parents/spouses/other listed owners), which may encourage careful title and co‑signing decisions.
  • Administrative/transactional effects: dealers and lenders will need to ensure guarantor language and separate guarantor instrument meet the statutory form and formatting requirements to preserve enforceability.
  • Possible litigation to interpret “actually receives the motor vehicle” and to apply the title‑owner exception.

Procedural status / source notes

  • The motor‑vehicle language appears as an amendment to 815 ILCS 375/18 (Motor Vehicle Retail Installment Sales Act). The Illinois version was introduced Feb 4, 2025 (Sen. Patrick J. Joyce) in the materials provided.
  • The overall combined document also contains unrelated Arizona and Hawaii statutory language; confirm the correct bill text and jurisdiction before citing or tracking legislative progress.

If you want, I can:
- Draft a one‑page explainer aimed at consumers/co‑signers,
- Compare the change to current Illinois law in greater detail, or
- Identify likely questions for lenders/dealers to update contract templates.

Compiled from official sources — confirm details with the bill’s official record.

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