Consumer Leasing Act FAQs

Ronald S. Weiss, Attorney & Counselor has represented Michigan and Ohio consumers in disputes over leased vehicles and other consumer goods for more than 25 years, and the questions below are the ones our clients ask most often. The Consumer Leasing Act is a federal law, so the answers apply in both states.

If you need to discuss a case, please reach out to our firm. Because the law requires the lessor to pay the attorney fees in a successful claim, our office does not charge Consumer Leasing Act clients a fee.

What is the Consumer Leasing Act?

The Consumer Leasing Act is a federal law, found at 15 U.S.C. § 1667, that requires a company leasing personal property to a consumer to disclose the full terms of the lease in writing before the consumer signs.

The law is part of the Truth in Lending Act, and the Truth in Lending Act protects consumers on their leases in the same way it protects borrowers on loans, by making the cost of the deal visible up front.

The federal rules that spell out the required disclosures are known as Regulation M. A lessor that leaves a required term out, misstates it, or changes it after signing can be held liable for Consumer Leasing Act violations.

What does the Consumer Leasing Act cover?

The law applies to a lease of personal property to an individual for personal, family, or household purposes when the lease term is more than four months.

Vehicle leases are the most common example, and the law also covers leases of furniture, appliances, electronics, and similar goods. A lease signed by a business, or a lease of goods used primarily for business, is not covered. Rent-to-own agreements that can be ended at any time without penalty are generally not covered either, because they do not commit the consumer to a term longer than four months.

Does the Consumer Leasing Act cover real estate?

No.

The law applies only to personal property, which means movable goods such as vehicles, appliances, and equipment. A residential lease for an apartment or a house is governed by state landlord-tenant law instead, and a lease of land or a building for a business is outside the law entirely. A lease that bundles personal property with real estate, such as a furnished apartment, is still treated as a real estate lease.

Is there a maximum lease amount for the Consumer Leasing Act to apply?

Yes.

The law applies only when the total contractual obligation under the lease is at or below a dollar cap that is adjusted for inflation each January. For leases signed in 2026, the cap is $73,400, and the cap is checked on the date the lease was signed, so a lease that was covered when signed stays covered even if the cap changes later. The total contractual obligation is the sum of the payments required under the lease, not the value of the vehicle, so most consumer vehicle leases fall under the cap even when the vehicle itself is expensive.

Does the Consumer Leasing Act apply if I later purchased the leased item?

It can.

The law applies to the lease as it was written and disclosed, so a violation in the lease disclosures does not disappear because the consumer later exercised an option to buy. The most common dispute of this kind involves the purchase option price itself, where the price the consumer is charged at lease end does not match the price disclosed in the lease. The item must have started out as a lease, however, and a purchase financed from the beginning is governed by the Truth in Lending Act's credit rules rather than by the Consumer Leasing Act.

Can the lessor change the terms of the lease after it is signed?

No.

The point of the law is that the consumer is entitled to know every material term before signing, and a lessor that changes a disclosed term afterward has defeated that purpose. Common examples include adding a fee at lease end that was not disclosed, changing the purchase option price, or recalculating the excess mileage charge at a higher rate than the lease stated. A change the consumer agrees to in writing, such as a lease extension, is a new agreement that must itself be disclosed properly.

What is an example of a Consumer Leasing Act violation?

One example that comes up often involves the purchase option at the end of a vehicle lease. The lease must state the price the consumer will pay to buy the vehicle when the lease ends. Some dealerships add fees to that figure, or revise the purchase option price in some other way, after the lease has been signed, and charging more than the disclosed price can violate the law.

Other examples of Consumer Leasing Act violations include failing to disclose the capitalized cost of the vehicle, the amount due at signing, the early termination charge, or the method used to calculate it.

What can I recover under the Consumer Leasing Act?

A consumer who proves a violation may recover actual damages, such as fees paid that should not have been charged.

The law also provides statutory damages of 25 percent of the total monthly payments under the lease, with a minimum of $200 and a maximum of $2,000, regardless of actual loss.

The lessor must also pay the consumer's reasonable attorney fees and court costs in a successful claim, which is why our office does not charge Consumer Leasing Act clients a fee.

Other claims, such as a state consumer protection claim or a lemon law claim on a defective leased vehicle, can sometimes be brought alongside it, since leased cars are protected under the lemon law in both Michigan and Ohio.

Is there a time limit for bringing a Consumer Leasing Act claim?

Yes.

A claim must be filed within one year of the violation. For a disclosure violation, the clock usually starts on the date the lease was signed, and for a lease-end violation, such as an improper purchase option charge, it usually starts when the charge was imposed. Because the deadline is short and the starting date is not always obvious, contact our office as soon as you suspect a problem so that the deadline is calculated correctly.

Do I have to submit my claim to arbitration?

The Consumer Leasing Act itself does not require arbitration, but most vehicle leases contain an arbitration clause, and that clause may require the dispute to be decided by an arbitrator rather than a court.

Arbitration clauses are generally enforceable, although some are drafted in ways that limit the remedies the law guarantees, which can make the clause unenforceable in part. We review the arbitration language in every lease before advising a client on how to proceed.

Can I bring a Consumer Leasing Act claim as a class action?

Sometimes.

When a lessor uses the same form lease or the same lease-end practice with many consumers, a class action may be available, and it is often the only practical way to correct the practice. Many leases contain language that waives the right to bring a class action, and whether that waiver is enforceable depends on the lease and on current case law. We discuss with each client whether an individual claim or a class claim is the better course.

What should I do if I believe my rights were violated?

Gather the lease, every document you signed at delivery, every statement or invoice you received during the lease, and any lease-end paperwork, and then call or email our office for a free consultation.

Because the lessor must pay the attorney fees in a successful claim, there is no fee to you, and a lessor that knows it faces fee exposure is more likely to resolve the claim.

Ronald S. Weiss, Attorney & Counselor handles Consumer Leasing Act claims for consumers throughout Michigan and Ohio and will discuss your situation by phone no matter where in either state you live.