Notes On Consumer Affairs
Consumers in the market for a new automobile are faced with a host of decisions, including which make and model, trim level, color, and optional accessories to select. The most important decision, from a financial perspective, is, of course, the method of acquiring a new car or truck. Those who choose to lease a vehicle are afforded several protections under federal and New York State law. If you are considering a lease, or you are currently leasing a vehicle, it is important to know your rights.
Leasing a motor vehicle can be a very complicated transaction that requires consumers to enter into a binding agreement. As such, it is crucial that consumers fully understand their obligations before entering into a lease.
The Federal Consumer Leasing Act and New York’s Motor Vehicle Retail Leasing Act (Article 9-A of the Personal Property Law) require lessors to include several key pieces of information in any lease agreement, including the amount due at lease signing, the number and amount of monthly payments, the total amount to be paid by the consumer over the course of the lease term, and all fees and charges.
Fees that are not included in the monthly payment, such as a “turn-in,” or disposition fee that becomes due upon returning the vehicle must be disclosed separately. Leasing agreements must also contain prominent disclosures regarding early termination charges, the consumer’s liability with respect to excessive wear and damage, the consumer’s duty to maintain the vehicle, and any express warranties provided with the vehicle.
It is a good idea to keep a copy of the completed agreement, which lessors must provide at signing, for future reference.
In addition to provisions aimed at ensuring that consumers considering and entering into leases are fully informed, the Motor Vehicle Retail Leasing Act contains several provisions regulating lease terms and conditions.
Under the Act, lessors must provide lessees with a grace period of at least ten days before a late fee may be assessed and one opportunity to reinstate the lease term in the event that the lessee defaults solely due to a late payment.
Lessees are allowed to terminate the lease at any time after half of the lease term has passed, provided that all obligations are current and the lessee complies with any early termination provisions.
The Act limits the amount that a lessor may charge a lessee for excess wear and damage upon return of the vehicle to the actual cost of repairs or the amount of an itemized estimate of the cost of such repairs issued by a licensed appraiser, requires lessors to provide lessees with an itemized excess wear and damage bill, and grants lessees who disagree with the bill the right to a second inspection. Lessees may submit any dispute regarding an excessive wear and damage charge to a binding arbitration program administered by the New York State Attorney General’s Office.
Lessees who believe their rights have been violated may bring an action under the Act for actual damages suffered and reasonable attorney’s fees. In addition to the protections provided under the Act, consumers should be aware that New York’s Lemon Law protections apply to leased vehicles.
For more information about motor vehicle leasing, you may wish to visit the New York City Department of Consumer Affairs’ webpage on the subject at
For more information about your rights under the Act, consider visiting the Attorney General’s webpage on the subject at: