Leasing is an important profit center for dealers and a frequent area of automobile fraud. Recently the use of leasing has again expanded and now represents between a quarter and a third of the total volume of cars financed at the dealership. The federal Consumer Leasing Act, Regulation M, and state leasing statutes set out disclosure requirements and standards about early termination and default penalties. These are examined in detail in NCLC’s Truth in Lending.22 Early lease termination and default also raise issues very similar to those that arise in a car repossession; these issues are examined in NCLC’s Repossessions.23
Leasing also may involve numerous abuses as to the terms of the lease, such as: stealing trade-ins, down payments, and rebates; higher capitalized costs or lease charges than represented; manipulation of residual values; misrepresentation about other lease terms; or even deception about whether a transaction is or is not a lease. These issues are examined in NCLC’s Unfair and Deceptive Acts and Practices.24
22 National Consumer Law Center, Truth in Lending Ch. 13 (9th ed. 2015), updated at www.nclc.org/library.
23 National Consumer Law Center, Repossessions § 14.2 (9th ed. 2017), updated at www.nclc.org/library.
24 National Consumer Law Center, Unfair and Deceptive Acts and Practices § 7.6 (9th ed. 2016), updated at www.nclc.org/library.