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.
- 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