Lease Buyout Overcharge

A lease purchase option in consumer lease agreements grants the lessee (the individual leasing the vehicle) the right to purchase the leased vehicle at the end of the lease term for a predetermined price. Essentially, it gives the lessee the opportunity to buy the vehicle they’ve been leasing rather than returning it to the lessor (the leasing company) at the end of the lease term. This option is typically outlined in the lease agreement and may include specific terms and conditions regarding the purchase price, timing of the buyout, and any additional fees associated with the purchase.
Regarding whether a dealership must honor the terms of the lease buyout, it depends on the specifics of the lease agreement and applicable state laws. Generally, if the lease agreement includes a purchase option and the lessee chooses to exercise that option according to the terms outlined in the agreement, the dealership or lessor is typically obligated to honor the agreed-upon terms of the buyout.
The Consumer Leasing Act (CLA) requires lessors to provide certain disclosures to lessees regarding lease purchase options. These disclosures include:
  1. The existence of any purchase option and the specific terms and conditions associated with exercising that option.
  2. The purchase price or method for determining the purchase price at the end of the lease term.
  3. Any fees or charges that may apply if the lessee chooses to exercise the purchase option.
Failure to provide these disclosures may constitute a violation of the CLA and could subject the lessor to legal consequences.
If a consumer was charged additional fees to buy out their leased vehicle that weren’t disclosed in the purchase option in their lease, they may have grounds for legal action. Potential damages available to the consumer could include:
  1. Refund of any undisclosed fees or charges associated with the lease buyout.
  2. Compensation for any financial losses incurred as a result of the undisclosed fees, such as overpayment for the vehicle.
  3. Statutory damages under the CLA for violations of disclosure requirements.
  4. Legal fees and costs associated with pursuing a legal claim against the lessor.