Consumer Leasing Act Summary

The Consumer Leasing Act - (15 U.S.C. §§ 1667-1667f, as amended)

What is required?

Automobile and car dealer would be a common example of a company which the CLA would regulate.

When does the law apply?

The CLA requires lessors to give certain disclosures to a consumer in connection with the lease of an automobile or other personal property. 

For example:

 - A lessor must disclose, among other things:

• The amount due at lease signing;

• The payment schedule for the lease and the total amount of payments;

• Other charges in connection with the lease;

• The residual value of the lease (how much the item will be worth at the end of the lease);

• The amount and method of determining any penalty or charge for early termination of the lease;

• A statement about who is responsible for maintenance;

•  Penalties and other charges for delinquency; and

• Information about any purchase option on the lease.

- If a lessor advertises a consumer lease, such as in a newspaper, on television, or through the mail,      and if the advertisement includes information about the payment amount or any down payment required, additional information must be included, such as:

• The fact that the advertisement is for a lease;

• The total amount due prior to delivery;

• The number, amount, and due dates of scheduled payments; and

• A statement as to whether or not a security deposit is required. 

Is there a solution?

If a lessor violates the CLA, a consumer may be entitled to actual damages and statutory damages of up to $2,000. In addition, the CLA contains a “fee-shifting” provision which may require the defendant to pay for the plaintiff’s attorney fees and court costs.

Last Modified: Wednesday, April 10, 2013