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Itemization of Amount Due at Lease Signing

Immediately below the lease box on the FRB disclosure form is the itemization of the "amount due at lease signing." (See Exhibit 2) This section corresponds to the first section of the lease box at the top of the form and uses a two column format. The left hand column itemizes the individual amounts due at lease signing with a total amount at the bottom. The right hand column is labeled "How the Amount Due at Lease Signing will be paid." It itemizes where the amounts come from into three categories: net trade-in allowance, rebates and credits, and cash.

Exhibit 2 Itemization of Amount Due at Lease Signing

The consumer can see how much of any trade-in allowance, rebate or cash payments are allocated to the initial lease payments. The remainder of the initial payments should be credited as a "capitalized cost reduction" and shown in the "payment calculation" section. The "total" shown for each column must be the same, indicating that all the amounts paid for amounts due at lease signing have been credited. Payment Calculation The biggest addition to the federal consumer leasing disclosure requirements is the section which requires lessors to specify the 10 items which are needed for the consumer to see how the monthly payment is calculated. (See Exhibit 3.) The ACVL strongly supported the disclosure of the computation of the monthly payment on this standardized basis. The Association believes that consumers will have a much easier time understanding how the monthly payment was derived and comparing lease offers with these new disclosures.