Consumer Leasing Act: Content of Non-Segregated Disclosures | ABA Exam Answer

Content of Non-Segregated Disclosures

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In Consumer Leasing Act Content of non-segregated disclosures may be made separately or as part of another document (such as the lease agreement); however, other information cannot be stated, used, or placed so as to mislead or confuse the consumer. Other disclosures include all of the following EXCEPT:

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A. B. C. D.

D

Under the Consumer Leasing Act (CLA), lessors are required to make certain disclosures to consumers who lease personal property. These disclosures must be made clearly and conspicuously, and in a meaningful sequence that enables the consumer to understand the transaction.

One of the requirements of the CLA is that lessors must provide disclosures about the terms and conditions of the lease agreement. This includes a statement of the conditions under which the lessee or lessor may terminate the lease before the end of the lease term, along with the amount (or a description of the method of how the amount is determined) of any penalty or other charge for early termination. This is option A in the given answer choices.

Another requirement under the CLA is that lessors must disclose whether the lessee has the option to purchase the leased property during the lease term and, if applicable, the purchase price (or method for determining it) and when the lessee may exercise it. This is option B in the given answer choices.

Additionally, the CLA requires that lessors disclose the lessee's right to an independent appraisal of the property if the lessee's liability at the end of the lease is based on the realized value of the leased property, and that the appraisal will be binding on all parties. This is option C in the given answer choices.

However, the CLA does not require lessors to disclose a statement of maintenance responsibilities including the counter bank responsible and a description of the responsibility. This is option D in the given answer choices.

It is important for lessors to comply with the CLA requirements to avoid misleading or confusing the consumer. The disclosures should be provided in a manner that is clear and easily understandable, and should not be buried in fine print or confusing language. By providing accurate and complete disclosures, lessors can help ensure that consumers have the information they need to make informed decisions about leasing personal property.