Consumer Leasing Act
Implemented by the CFPB’s Reg M, the Consumer Leasing Act is intended to provide consumers with disclosures that let them compare terms for a lease with other leases, and to compare those lease terms with those for credit transactions. It only applies to consumer leases. Consumer leases may include:
- Automobile leases, furniture leases, and other personal property leases
- Closed-end (“walk-away”) leases
- Open-end leases
These disclosures must be:
- Made clearly and conspicuously in writing.
- In a form the consumer can keep.
- Provided before the consummation of the lease agreement.
- Segregated from other information in certain cases. They may be made in a separate statement identifying the transaction, or in the contract, or in another document that evidences the lease.
Different lease are required to include different information in the disclosures.
The Consumer Leasing Act applies to all persons who regularly lease, offer to lease, or arrange for the lease of personal property under a consumer lease. To qualify, a person must lease, offer to lease, or arrange for a lease more than five times in the prior calendar year or the current calendar year.
