§ 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:

(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.

(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) 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) 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.

(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.