Limitations on Agreements and Practices

Utah Code tit. 70C, ch. 70C-2, pt. 70C-2-P2

in effect

Utah Code § 70C-2-201 Authorization to confess judgment prohibited.

70C-2-201. Authorization to confess judgment prohibited. A creditor or its successor in interest may not, directly or indirectly, take or receive from a debtor an obligation that constitutes or contains a cognovit or confession of judgment, warrant of attorney, or other waiver of the right to notice and the opportunity to be heard in the event of suit or process thereon. Enacted by Chapter 159, 1985 General Session

Utah Code § 70C-2-202 Assignment of earnings prohibited.

70C-2-202. Assignment of earnings prohibited. A creditor may not directly or indirectly take or receive from a debtor an obligation that constitutes or contains an assignment of wages or other earnings unless (1) the assignment by its own terms is revocable at the will of the debtor; (2) the assignment is a payroll deduction plan, commencing at the time of the transaction, in which the debtor authorized a series of wage deductions as a method of making each payment; or (3) the assignment applies only to wages or other earnings already earned at the time of the assignment. Enacted by Chapter 159, 1985 General Session

Utah Code § 70C-2-203 Additional security in consumer leases prohibited.

70C-2-203. Additional security in consumer leases prohibited. A lessor, in order to secure the debt arising from a consumer lease, may not take a security interest in the dwelling of the lessee. A security interest taken in violation of this section is void from its inception. Enacted by Chapter 159, 1985 General Session

Utah Code § 70C-2-204 Certain negotiable instruments prohibited.

70C-2-204. Certain negotiable instruments prohibited. (1) With respect to a consumer credit sale not involving real property, the seller may not take a negotiable instrument under Section 70A-3-104 other than a check as evidence of the obligation of the buyer. (2) A holder is not in good faith as that term is defined in Section 70A-1a-201 if the holder takes a negotiable instrument with notice that the negotiable instrument is issued in violation of this section. (3) A holder in due course under Section 70A-3-302 is not subject to the liabilities set forth in the provisions on the effect of violations on rights of parties under Section 70C-7-201. Amended by Chapter 322, 2026 General Session

Utah Code § 70C-2-205 Assignee subject to defenses.

70C-2-205. Assignee subject to defenses. With respect to a consumer credit sale, an assignee of the rights of the seller is subject to all defenses of the buyer against the seller arising out of the credit sale, but the assignee's liability under this section may not exceed the amount owing to the assignee at the time the defense is asserted against the assignee, and the rights of the buyer may only be asserted as a matter of defense to or setoff against a claim by the assignee. Enacted by Chapter 159, 1985 General Session

Utah Code § 70C-2-206 Settlement of claims.

70C-2-206. Settlement of claims. (1) A claim by a debtor against a creditor for an excess charge, other violation of this title, or civil penalty if disputed in good faith, may be settled by agreement for less value than the amount claimed, unless a court, as a matter of law, finds the settlement to have been unconscionable at the time it was made. (2) A claim, whether or not disputed, against a debtor may be settled for less value than the amount claimed. Enacted by Chapter 159, 1985 General Session

Utah Code § 70C-2-207 Referral sales.

70C-2-207. Referral sales. With respect to a consumer credit sale, the seller may not give or offer to give a rebate or discount or otherwise pay or offer to pay value to the buyer as an inducement for a sale in consideration of the buyer giving to the seller the names of prospective purchasers or otherwise aiding the seller in making a sale to another person, if the earning of the rebate, discount, or other value is contingent upon the occurrence of an event subsequent to the time the buyer agrees to buy. If a buyer is induced by a violation of this section to enter into a consumer credit sale, the agreement is unenforceable by the seller and the buyer may rescind the agreement and retain any goods delivered until all payments made by the debtor have been fully refunded to the buyer. The buyer may retain the benefit of any services performed without any obligation to pay for them. This section does not apply if any goods delivered to the buyer are damaged while in the buyer's possession or are not delivered to the seller at the buyer's residence, or at any other place agreed on by the parties, within a reasonable time after the seller tenders or delivers a full refund of all payments to the buyer. Amended by Chapter 302, 2025 General Session

Source: Utah Office of Legislative Research and General Counsel (le.utah.gov)URL: https://le.utah.gov/xcode/Title70C/Chapter2/70C-2-P2.html?v=C70C-2-P2_1800010118000101Fetched: 10/26/2026