(815 ILCS 636/1) Sec. 1. Short title. This Act may be cited as the Motor Vehicle Leasing Act. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/5) Sec. 5. Statement of intent. It is the purpose of this Act to promote the understanding of vehicle leasing in this State by providing for the disclosure of lease obligations to consumer lessees. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10) Sec. 10. Definitions and rules of construction. In this Act, unless the context or subject matter otherwise requires, the following words and phrases have the meanings set forth in the following Sections. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.5) Sec. 10.5. Adjusted capitalized cost. The amount which serves as the basis for determining the base lease payment, computed by subtracting from the capitalized cost any capitalized cost reduction. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.10) Sec. 10.10. Average periodic depreciation. The difference between the adjusted capitalized cost and the residual value divided by the number of payment periods in the consumer lease, or, for a single payment lease, divided by the number of months in the term of the lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.15) Sec. 10.15. Average periodic lease charge. The lease charge for the scheduled term of the consumer lease divided by the number of payment periods or, for a single payment lease, divided by the number of months in the term of the lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.20) Sec. 10.20. Base lease payment. That portion of the periodic lease payment which shall be the sum of (a) the average periodic lease charge and (b) the average periodic depreciation. For a single payment lease, the base lease payment is the sum of (a) the average periodic lease charge multiplied by the number of months in the term of the lease and (b) the average periodic depreciation multiplied by the number of months in the lease term. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.25) Sec. 10.25. Capitalized cost. The amount which, when reduced by the amount of the capitalized cost reduction, equals the adjusted capitalized cost. The capitalized cost includes all items which are capitalized in the lease and after the application of the capitalized cost reduction, amortizes to the residual value by the depreciation portion of the periodic lease payments over the term of the lease. For a single payment lease, the capitalized cost amortizes to the residual value by the depreciation portion of the single lease payment. The capitalized cost may include, without limitation, taxes, registration, license, acquisition, administration, assignment and other fees, and charges for insurance, for a waiver of the contractual obligation to pay the gap amount, for accessories and their installation, for delivering, servicing, repairing, or improving the vehicle, and for other services and benefits incidental to the consumer lease. It also may include, with respect to a vehicle or other property traded in connection with a lease, the unpaid balance of any amount financed under an outstanding vehicle loan agreement or vehicle retail installment contract or the unpaid portion of the early termination obligation under a lease or other obligation of the lessee. The term capitalized cost does not include any lease charge. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.30) Sec. 10.30. Capitalized cost reduction. Payments made by cash, check, rebates, or similar means that are in the nature of down payments made by the lessee and any net trade‑in allowance granted by the lessor at the inception of the consumer lease for the purpose of reducing the capitalized cost. The term capitalized cost reduction does not include any base lease payments due at the inception of the lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.35) Sec. 10.35. Conspicuous. Distinguished from other terms by type size or in some other manner. A term in at least 10‑point bold type shall be deemed to be conspicuous for the purposes of this Act. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.40) Sec. 10.40. Constant yield method. (a) In the case of a periodic payment lease, the method of determining the lease charge portion of each base lease payment pursuant to which the lease charge for each computational period is earned in advance of that period by multiplying the constant rate implicit in the lease times the balance subject to lease charge as it declines during the lease term. At any given time during the scheduled term of a periodic payment lease, the balance subject to lease charge is the difference between the adjusted capitalized cost and the sum of (i) all depreciation amounts accrued during the preceding computational periods and (ii) the first base lease payment. (b) In the case of a single payment lease, the method of determining the periodic earning of the lease charge portion of the single lease payment pursuant to which the lease charge for each computational period is earned in advance of that period by multiplying the constant rate implicit in the lease times the balance subject to lease charge as it increases during the lease term. At any given time during the term of a single payment lease, the balance subject to lease charge is determined by subtracting from the residual value the total lease charge scheduled to be earned over the lease term and adding to the difference all lease charges accrued during the preceding computational periods. (c) In the case of either a periodic payment lease or a single payment lease, the periodic lease charge calculations are based on the assumption that the holder will receive the lease payment or payments on their exact due date or dates and that the lease goes to its full term. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.45) Sec. 10.45. Consumer lease. A contract, entered into in this State, which transfers the right of possession for use of a vehicle by a natural person primarily for personal, family, or household purposes, for a period of more than one year, for a total contractual obligation not exceeding $25,000, whether or not the lessee has the option to purchase or otherwise become the owner of the vehicle at the expiration of the consumer lease. The term consumer lease does not include the following: an agreement which meets the definition of a credit sale in Regulation Z, 12 C.F.R. Section 226.2(a) or a retail installment transaction as defined by the Motor Vehicle Retail Installment Sales Act, or a lease for agricultural, business, or commercial purposes or one made to an organization. A consumer lease may include the purchase of goods, services, or benefits incidental to the lease, whether or not the purchase price is included in the capitalized cost. Unless expressly provided in the contract, a contract that substantially complies with this Act does not create a security interest in a vehicle as the term "security interest" is defined in subsection 37 of section 1‑201 of the Uniform Commercial Code. For the purpose of this definition, "total contractual obligation" is computed on the assumption that the consumer lease is not terminated before the end of the scheduled term, that there is no default, and that the lessee does not exercise any purchase option. "Total contractual obligation" includes the capitalized cost reduction; plus the scheduled lease payments over the term of the lease, or in the case of a single payment lease, the single lease payment; plus any disposition fee or other disposition charges known or calculable at the time the lease is executed. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.50) Sec. 10.50. Consumer Leasing Act. That Act of Congress codified as 15 U.S.C. 1667 et seq. and regulations promulgated pursuant thereto, as that Act and regulations may be amended from time to time. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.55) Sec. 10.55. Gap amount. The difference between the amount owed (or which would be owed in the absence of gap protection) by the lessee under the consumer lease in the event of a total loss of the vehicle prior to the end of the lease term occasioned by its theft, physical damage, or other occurrence as specified in the consumer lease and the actual cash value or portion of the actual cash value of the vehicle, actually received by the lessor from the insurance company or from any other person. The term gap amount shall not include any deductible amount applicable to an insurance policy maintained by the lessee or any past due amounts owed by the lessee as of the time of the receipt by the lessor of the insurance proceeds or any other amount due because of the lessee's default. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.60) Sec. 10.60. Gap protection. A contractual undertaking by the holder or lessor or by a third party to waive or provide that a third person shall pay the gap amount. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.65) Sec. 10.65. Group credit insurance. Group credit life insurance, group credit accident insurance, group credit accident and health insurance, group disability insurance, or group credit unemployment insurance. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.70) Sec. 10.70. Holder. The lessor or owner of a vehicle under or subject to a consumer lease and if ownership of the consumer lease is acquired by an assignee, the assignee for the period of the assignee's ownership. The term holder does not include a pledgee of a consumer lease to secure a bona fide obligation secured by the consumer lease or the owner or beneficiary of an interest in a trust that owns consumer leases. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.75) Sec. 10.75. Lease charge. The charge determined by the lessor to be paid by the lessee for the privilege of making the lease payments as scheduled under a consumer lease. The term lease charge does not include any amount included in the capitalized cost or any delinquency, default, disposition, early termination, collection, or reinstatement charge. The term lease charge does not include the amount, if any, for taxes, registration, license, acquisition, administration, assignment and other fees, and charges for insurance, for accessories or their installation, for delivering, servicing, repairing, or improving the vehicle, and for other goods, benefits, or services incidental to the consumer lease, (a) included in the capitalized cost, (b) paid for separately at lease inception by cash, check, credit card, or similar means, or (c) paid for on a periodic basis in addition to the base lease payment. The lessor may calculate lease charges on any basis. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.80) Sec. 10.80. Lessee. A natural person who leases a vehicle under a consumer lease. For purposes of Section 15 of this Act, the term also includes a natural person who makes a payment to a lessor as an advance lease payment, deposit, or down payment or who leaves his vehicle with a lessor pending the execution of a consumer lease. The term does not include a person who leases a vehicle primarily for agricultural, business, or commercial use. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.85) Sec. 10.85. Lessor. A person regularly engaged in the business of leasing or selling vehicles who leases a vehicle under a consumer lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.90) Sec. 10.90. Person. An individual, partnership, corporation, association or other group, however organized. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.95) Sec. 10.95. Precomputed lease transaction. A consumer lease transaction in which the total of the base lease payments for the term of the lease is established at the inception of the lease, whether or not it is paid at that time, as a sum comprising the total depreciation estimated for the scheduled lease term and the amount of the lease charge computed in advance for the scheduled term of the lease. A disclosure required by the Consumer Leasing Act does not in itself make a lease charge or transaction precomputed. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.100) Sec. 10.100. Realized value. The greater of (a) the price received by the lessor for disposition of the vehicle, after subtracting all actual and reasonable expenses of sale or (b) insurance proceeds in the event of the total loss or destruction of the vehicle or (c) the highest bona fide offer received by the holder for disposition of the vehicle. However, if the lessor and the lessee agree upon the realized value, the agreed upon amount shall be the realized value. The vehicle's realized value may be determined in the customary wholesale market at the time of disposition of the vehicle. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.105) Sec. 10.105. Renegotiation. The satisfaction and replacement of an existing consumer lease by a new consumer lease undertaken by the same lessee. The term renegotiation does not include (a) a deferral or extension of one or more periodic lease payments or portions of one or more periodic payments; (b) a consumer lease involving a court proceeding or the settlement of a dispute; or (c) any other agreement or event which does not constitute a "renegotiation" under the Consumer Leasing Act. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.110) Sec. 10.110. Residual value. The estimated value of the vehicle at the end of the scheduled lease term, used by the lessor in determining the base lease payment, as established by the lessor at the time the lessor and lessee enter into a consumer lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.115) Sec. 10.115. Single payment lease. A consumer lease for which a single payment is required to be paid at the beginning of the lease for the scheduled term of the lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.120) Sec. 10.120. Vehicle or motor vehicle. A motor vehicle as defined in Section 1‑146 of the Illinois Vehicle Code. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.125) Sec. 10.125. Words in the singular include the plural and vice versa, unless otherwise specified. The term "periodic" means "monthly", "weekly", "quarterly", or any other period as specified in the consumer lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/15) Sec. 15. Payment or trade‑in pending execution of consumer lease: refund or return upon non‑execution. (a) If a lessee has made a payment to a lessor pending the execution of a consumer lease, has surrendered possession of a trade‑in vehicle, or both, the lessee shall have the right, if the consumer lease application is not approved, to have any trade‑in vehicle returned promptly and receive a prompt refund of any payments made. If a lessee leaves a trade‑in vehicle with the lessor and the lessor and lessee agree that the parties shall enter into a consumer lease, the lessor shall not sell or transfer the trade‑in vehicle until the lessee and the lessor execute a consumer lease. (b) This Section shall not apply to the sale of a vehicle by a prospective lessee to a prospective lessor under a separate contract or sale if the contract is executed before the parties have consummated a consumer lease, is dated as of the sale date and is signed by the parties. The contract shall provide that the contract price establishes the vehicle's value for purposes of determining the amount the lessor will credit as a "capitalized cost reduction" under any consumer lease subsequently consummated by the parties or as the amount due as stated in subsection (a) of this Section to the lessee for the vehicle in the event the parties fail to consummate a consumer lease within 30 days; that the prospective lessee agrees to leave the contract price on deposit with the prospective lessor pending the consummation of a consumer lease for a vehicle to be ordered from the manufacturer or for a vehicle not yet in production as of the date of the contract; and that 75 days after the sale date, the prospective lessee shall be entitled to payment of the agreed upon price for the vehicle unless within that time the parties have consummated a consumer lease or have agreed to an earlier payment of the price to the prospective lessee. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/20) Sec. 20. Total loss notice and waiver of the gap amount. (a) If the consumer lease provides that the lessee shall be responsible for the gap amount, the consumer lease shall disclose that fact and disclose the obligations for which the lessee would remain liable in the event of a total loss of the vehicle prior to the end of the lease term occasioned by its theft, physical damage, or other occurrence as specified in the consumer lease, using the term "gap amount". (b) The lessor may waive its contractual right to hold the lessee liable for some or all of the gap amount. This waiver may be granted either without a separate charge to the lessee, or in exchange for the payment by the lessee of a separate charge. Any separate charge for the waiver must be conspicuously disclosed to the lessee. (c) If the lessor under subsection (b) of this Section offers for a separately stated charge to waive its contractual right to hold the lessee liable for the gap amount, the lease shall also contain a conspicuous notice which shall (1) state that for a separate charge disclosed in the notice the lessor will waive its contractual right to hold the lessee liable for the gap amount and (2) state that the lessee may as an alternative to purchasing a waiver, be able to purchase protection covering the gap amount from a company which has been authorized to do business in this State. Failure to provide the notice as required by this subsection shall invalidate any lease provision which otherwise would obligate a lessee to pay to the holder or lessor, after a total loss of the vehicle occasioned by its theft, physical damage or other occurrence as specified in the consumer lease, any of the items specified in paragraphs (5) and (6) of subsection (b) of Section 45 of this Act. No consumer lease shall be conditioned upon the lessee obtaining vehicle lessee gap protection. (d) The lessor's waiver of its contractual right to hold the lessee liable for the gap amount may be conditioned upon the receipt by the lessor of (1) all amounts due under the consumer lease as of the date of receipt by the lessor of the insurance proceeds or equivalent amount as specified in the lease or if no such date is specified, as of the date of total loss of the vehicle, (2) an amount from the lessee equal to the amount of the lessee's deductible and any other subtractions from the actual cash value under the lessee's insurance policy, and (3) insurance proceeds from the insurance policy required under the lease or the equivalent amount of the value of the vehicle. (e) No insurance or other additional license shall be required of lessors who waive or offer to waive their contractual right to hold the lessee liable for the gap amount. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/25) Sec. 25. Requirements for a consumer lease. (a) A consumer lease shall be in writing and signed by the lessor and the lessee. (b) The printed portion of the consumer lease, other than directions for completion of the consumer lease, shall be printed in a size equal to at least eight‑point type. The consumer lease shall contain the following items printed or written in a conspicuous manner: (1) At the top of the consumer lease, in at least
10‑point bold capitalized type, the words "MOTOR VEHICLE LEASE AGREEMENT".
(2) If physical damage or liability insurance
coverage for bodily injury and property damage caused to others is not included in the consumer lease, a notice in at least 10‑point bold capitalized type, substantially similar to the following: "NO PHYSICAL DAMAGE OR LIABILITY INSURANCE COVERAGE FOR BODILY INJURY OR PROPERTY DAMAGE CAUSED TO OTHERS IS INCLUDED IN THIS LEASE."
(3) Directly above the acknowledgement permitted by
subsection (c) of this Section to appear above the space reserved for the lessee's signature, a written notice substantially similar to the following:
"NOTICE TO THE LESSEE: This is a lease. You
have no ownership rights in the vehicle unless and until you exercise your option to purchase the vehicle, if this lease contains a purchase option. Do not sign this lease before you read it. Early termination may require you to pay a substantial amount. You are entitled to a completed copy of this lease when you sign it."
(c) The lessor shall deliver to the lessee a completed copy of the consumer lease signed by the lessor. Any acknowledgement by the lessee of delivery of a copy of the consumer lease shall be conspicuous and shall appear directly above the space reserved for the lessee's signature. (d) The consumer lease shall contain the names of the lessor and the lessee, the place of business of the lessor, the residence or place of business of the lessee as specified by the lessee, and a description of the vehicle, including its make, model year, model, and, if known, the vehicle's identification number or marks. (e) The consumer lease shall contain the following: (1) All items required to be disclosed by the
Consumer Leasing Act and, in addition, the following items if the items or substantially similar items are not required to be disclosed by the Consumer Leasing Act.
(2) The capitalized cost, identified as "capitalized
cost", and a descriptive explanation such as "the agreed upon amount determined at lease inception for all items and services included in the lease".
(3) Any capitalized cost reduction, using the term
"capitalized cost reduction".
(4) The adjusted capitalized cost, using the term
"adjusted capitalized cost" and a descriptive explanation, as applicable, such as "the agreed upon amount which serves as the basis for determining the base lease payment. If you are not in default, this amount plus any applicable early termination charges determines your maximum early termination obligation".
(5) If the lessee is not permitted to terminate the
lease at any time, the consumer lease shall contain a conspicuous statement setting forth any prohibitions upon the lessee's ability to terminate the consumer lease at any time before the end of the scheduled term.
(815 ILCS 636/1) Sec. 1. Short title. This Act may be cited as the Motor Vehicle Leasing Act. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/5) Sec. 5. Statement of intent. It is the purpose of this Act to promote the understanding of vehicle leasing in this State by providing for the disclosure of lease obligations to consumer lessees. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10) Sec. 10. Definitions and rules of construction. In this Act, unless the context or subject matter otherwise requires, the following words and phrases have the meanings set forth in the following Sections. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.5) Sec. 10.5. Adjusted capitalized cost. The amount which serves as the basis for determining the base lease payment, computed by subtracting from the capitalized cost any capitalized cost reduction. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.10) Sec. 10.10. Average periodic depreciation. The difference between the adjusted capitalized cost and the residual value divided by the number of payment periods in the consumer lease, or, for a single payment lease, divided by the number of months in the term of the lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.15) Sec. 10.15. Average periodic lease charge. The lease charge for the scheduled term of the consumer lease divided by the number of payment periods or, for a single payment lease, divided by the number of months in the term of the lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.20) Sec. 10.20. Base lease payment. That portion of the periodic lease payment which shall be the sum of (a) the average periodic lease charge and (b) the average periodic depreciation. For a single payment lease, the base lease payment is the sum of (a) the average periodic lease charge multiplied by the number of months in the term of the lease and (b) the average periodic depreciation multiplied by the number of months in the lease term. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.25) Sec. 10.25. Capitalized cost. The amount which, when reduced by the amount of the capitalized cost reduction, equals the adjusted capitalized cost. The capitalized cost includes all items which are capitalized in the lease and after the application of the capitalized cost reduction, amortizes to the residual value by the depreciation portion of the periodic lease payments over the term of the lease. For a single payment lease, the capitalized cost amortizes to the residual value by the depreciation portion of the single lease payment. The capitalized cost may include, without limitation, taxes, registration, license, acquisition, administration, assignment and other fees, and charges for insurance, for a waiver of the contractual obligation to pay the gap amount, for accessories and their installation, for delivering, servicing, repairing, or improving the vehicle, and for other services and benefits incidental to the consumer lease. It also may include, with respect to a vehicle or other property traded in connection with a lease, the unpaid balance of any amount financed under an outstanding vehicle loan agreement or vehicle retail installment contract or the unpaid portion of the early termination obligation under a lease or other obligation of the lessee. The term capitalized cost does not include any lease charge. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.30) Sec. 10.30. Capitalized cost reduction. Payments made by cash, check, rebates, or similar means that are in the nature of down payments made by the lessee and any net trade‑in allowance granted by the lessor at the inception of the consumer lease for the purpose of reducing the capitalized cost. The term capitalized cost reduction does not include any base lease payments due at the inception of the lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.35) Sec. 10.35. Conspicuous. Distinguished from other terms by type size or in some other manner. A term in at least 10‑point bold type shall be deemed to be conspicuous for the purposes of this Act. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.40) Sec. 10.40. Constant yield method. (a) In the case of a periodic payment lease, the method of determining the lease charge portion of each base lease payment pursuant to which the lease charge for each computational period is earned in advance of that period by multiplying the constant rate implicit in the lease times the balance subject to lease charge as it declines during the lease term. At any given time during the scheduled term of a periodic payment lease, the balance subject to lease charge is the difference between the adjusted capitalized cost and the sum of (i) all depreciation amounts accrued during the preceding computational periods and (ii) the first base lease payment. (b) In the case of a single payment lease, the method of determining the periodic earning of the lease charge portion of the single lease payment pursuant to which the lease charge for each computational period is earned in advance of that period by multiplying the constant rate implicit in the lease times the balance subject to lease charge as it increases during the lease term. At any given time during the term of a single payment lease, the balance subject to lease charge is determined by subtracting from the residual value the total lease charge scheduled to be earned over the lease term and adding to the difference all lease charges accrued during the preceding computational periods. (c) In the case of either a periodic payment lease or a single payment lease, the periodic lease charge calculations are based on the assumption that the holder will receive the lease payment or payments on their exact due date or dates and that the lease goes to its full term. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.45) Sec. 10.45. Consumer lease. A contract, entered into in this State, which transfers the right of possession for use of a vehicle by a natural person primarily for personal, family, or household purposes, for a period of more than one year, for a total contractual obligation not exceeding $25,000, whether or not the lessee has the option to purchase or otherwise become the owner of the vehicle at the expiration of the consumer lease. The term consumer lease does not include the following: an agreement which meets the definition of a credit sale in Regulation Z, 12 C.F.R. Section 226.2(a) or a retail installment transaction as defined by the Motor Vehicle Retail Installment Sales Act, or a lease for agricultural, business, or commercial purposes or one made to an organization. A consumer lease may include the purchase of goods, services, or benefits incidental to the lease, whether or not the purchase price is included in the capitalized cost. Unless expressly provided in the contract, a contract that substantially complies with this Act does not create a security interest in a vehicle as the term "security interest" is defined in subsection 37 of section 1‑201 of the Uniform Commercial Code. For the purpose of this definition, "total contractual obligation" is computed on the assumption that the consumer lease is not terminated before the end of the scheduled term, that there is no default, and that the lessee does not exercise any purchase option. "Total contractual obligation" includes the capitalized cost reduction; plus the scheduled lease payments over the term of the lease, or in the case of a single payment lease, the single lease payment; plus any disposition fee or other disposition charges known or calculable at the time the lease is executed. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.50) Sec. 10.50. Consumer Leasing Act. That Act of Congress codified as 15 U.S.C. 1667 et seq. and regulations promulgated pursuant thereto, as that Act and regulations may be amended from time to time. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.55) Sec. 10.55. Gap amount. The difference between the amount owed (or which would be owed in the absence of gap protection) by the lessee under the consumer lease in the event of a total loss of the vehicle prior to the end of the lease term occasioned by its theft, physical damage, or other occurrence as specified in the consumer lease and the actual cash value or portion of the actual cash value of the vehicle, actually received by the lessor from the insurance company or from any other person. The term gap amount shall not include any deductible amount applicable to an insurance policy maintained by the lessee or any past due amounts owed by the lessee as of the time of the receipt by the lessor of the insurance proceeds or any other amount due because of the lessee's default. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.60) Sec. 10.60. Gap protection. A contractual undertaking by the holder or lessor or by a third party to waive or provide that a third person shall pay the gap amount. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.65) Sec. 10.65. Group credit insurance. Group credit life insurance, group credit accident insurance, group credit accident and health insurance, group disability insurance, or group credit unemployment insurance. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.70) Sec. 10.70. Holder. The lessor or owner of a vehicle under or subject to a consumer lease and if ownership of the consumer lease is acquired by an assignee, the assignee for the period of the assignee's ownership. The term holder does not include a pledgee of a consumer lease to secure a bona fide obligation secured by the consumer lease or the owner or beneficiary of an interest in a trust that owns consumer leases. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.75) Sec. 10.75. Lease charge. The charge determined by the lessor to be paid by the lessee for the privilege of making the lease payments as scheduled under a consumer lease. The term lease charge does not include any amount included in the capitalized cost or any delinquency, default, disposition, early termination, collection, or reinstatement charge. The term lease charge does not include the amount, if any, for taxes, registration, license, acquisition, administration, assignment and other fees, and charges for insurance, for accessories or their installation, for delivering, servicing, repairing, or improving the vehicle, and for other goods, benefits, or services incidental to the consumer lease, (a) included in the capitalized cost, (b) paid for separately at lease inception by cash, check, credit card, or similar means, or (c) paid for on a periodic basis in addition to the base lease payment. The lessor may calculate lease charges on any basis. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.80) Sec. 10.80. Lessee. A natural person who leases a vehicle under a consumer lease. For purposes of Section 15 of this Act, the term also includes a natural person who makes a payment to a lessor as an advance lease payment, deposit, or down payment or who leaves his vehicle with a lessor pending the execution of a consumer lease. The term does not include a person who leases a vehicle primarily for agricultural, business, or commercial use. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.85) Sec. 10.85. Lessor. A person regularly engaged in the business of leasing or selling vehicles who leases a vehicle under a consumer lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.90) Sec. 10.90. Person. An individual, partnership, corporation, association or other group, however organized. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.95) Sec. 10.95. Precomputed lease transaction. A consumer lease transaction in which the total of the base lease payments for the term of the lease is established at the inception of the lease, whether or not it is paid at that time, as a sum comprising the total depreciation estimated for the scheduled lease term and the amount of the lease charge computed in advance for the scheduled term of the lease. A disclosure required by the Consumer Leasing Act does not in itself make a lease charge or transaction precomputed. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.100) Sec. 10.100. Realized value. The greater of (a) the price received by the lessor for disposition of the vehicle, after subtracting all actual and reasonable expenses of sale or (b) insurance proceeds in the event of the total loss or destruction of the vehicle or (c) the highest bona fide offer received by the holder for disposition of the vehicle. However, if the lessor and the lessee agree upon the realized value, the agreed upon amount shall be the realized value. The vehicle's realized value may be determined in the customary wholesale market at the time of disposition of the vehicle. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.105) Sec. 10.105. Renegotiation. The satisfaction and replacement of an existing consumer lease by a new consumer lease undertaken by the same lessee. The term renegotiation does not include (a) a deferral or extension of one or more periodic lease payments or portions of one or more periodic payments; (b) a consumer lease involving a court proceeding or the settlement of a dispute; or (c) any other agreement or event which does not constitute a "renegotiation" under the Consumer Leasing Act. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.110) Sec. 10.110. Residual value. The estimated value of the vehicle at the end of the scheduled lease term, used by the lessor in determining the base lease payment, as established by the lessor at the time the lessor and lessee enter into a consumer lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.115) Sec. 10.115. Single payment lease. A consumer lease for which a single payment is required to be paid at the beginning of the lease for the scheduled term of the lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.120) Sec. 10.120. Vehicle or motor vehicle. A motor vehicle as defined in Section 1‑146 of the Illinois Vehicle Code. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.125) Sec. 10.125. Words in the singular include the plural and vice versa, unless otherwise specified. The term "periodic" means "monthly", "weekly", "quarterly", or any other period as specified in the consumer lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/15) Sec. 15. Payment or trade‑in pending execution of consumer lease: refund or return upon non‑execution. (a) If a lessee has made a payment to a lessor pending the execution of a consumer lease, has surrendered possession of a trade‑in vehicle, or both, the lessee shall have the right, if the consumer lease application is not approved, to have any trade‑in vehicle returned promptly and receive a prompt refund of any payments made. If a lessee leaves a trade‑in vehicle with the lessor and the lessor and lessee agree that the parties shall enter into a consumer lease, the lessor shall not sell or transfer the trade‑in vehicle until the lessee and the lessor execute a consumer lease. (b) This Section shall not apply to the sale of a vehicle by a prospective lessee to a prospective lessor under a separate contract or sale if the contract is executed before the parties have consummated a consumer lease, is dated as of the sale date and is signed by the parties. The contract shall provide that the contract price establishes the vehicle's value for purposes of determining the amount the lessor will credit as a "capitalized cost reduction" under any consumer lease subsequently consummated by the parties or as the amount due as stated in subsection (a) of this Section to the lessee for the vehicle in the event the parties fail to consummate a consumer lease within 30 days; that the prospective lessee agrees to leave the contract price on deposit with the prospective lessor pending the consummation of a consumer lease for a vehicle to be ordered from the manufacturer or for a vehicle not yet in production as of the date of the contract; and that 75 days after the sale date, the prospective lessee shall be entitled to payment of the agreed upon price for the vehicle unless within that time the parties have consummated a consumer lease or have agreed to an earlier payment of the price to the prospective lessee. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/20) Sec. 20. Total loss notice and waiver of the gap amount. (a) If the consumer lease provides that the lessee shall be responsible for the gap amount, the consumer lease shall disclose that fact and disclose the obligations for which the lessee would remain liable in the event of a total loss of the vehicle prior to the end of the lease term occasioned by its theft, physical damage, or other occurrence as specified in the consumer lease, using the term "gap amount". (b) The lessor may waive its contractual right to hold the lessee liable for some or all of the gap amount. This waiver may be granted either without a separate charge to the lessee, or in exchange for the payment by the lessee of a separate charge. Any separate charge for the waiver must be conspicuously disclosed to the lessee. (c) If the lessor under subsection (b) of this Section offers for a separately stated charge to waive its contractual right to hold the lessee liable for the gap amount, the lease shall also contain a conspicuous notice which shall (1) state that for a separate charge disclosed in the notice the lessor will waive its contractual right to hold the lessee liable for the gap amount and (2) state that the lessee may as an alternative to purchasing a waiver, be able to purchase protection covering the gap amount from a company which has been authorized to do business in this State. Failure to provide the notice as required by this subsection shall invalidate any lease provision which otherwise would obligate a lessee to pay to the holder or lessor, after a total loss of the vehicle occasioned by its theft, physical damage or other occurrence as specified in the consumer lease, any of the items specified in paragraphs (5) and (6) of subsection (b) of Section 45 of this Act. No consumer lease shall be conditioned upon the lessee obtaining vehicle lessee gap protection. (d) The lessor's waiver of its contractual right to hold the lessee liable for the gap amount may be conditioned upon the receipt by the lessor of (1) all amounts due under the consumer lease as of the date of receipt by the lessor of the insurance proceeds or equivalent amount as specified in the lease or if no such date is specified, as of the date of total loss of the vehicle, (2) an amount from the lessee equal to the amount of the lessee's deductible and any other subtractions from the actual cash value under the lessee's insurance policy, and (3) insurance proceeds from the insurance policy required under the lease or the equivalent amount of the value of the vehicle. (e) No insurance or other additional license shall be required of lessors who waive or offer to waive their contractual right to hold the lessee liable for the gap amount. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/25) Sec. 25. Requirements for a consumer lease. (a) A consumer lease shall be in writing and signed by the lessor and the lessee. (b) The printed portion of the consumer lease, other than directions for completion of the consumer lease, shall be printed in a size equal to at least eight‑point type. The consumer lease shall contain the following items printed or written in a conspicuous manner: (1) At the top of the consumer lease, in at least
10‑point bold capitalized type, the words "MOTOR VEHICLE LEASE AGREEMENT".
(2) If physical damage or liability insurance
coverage for bodily injury and property damage caused to others is not included in the consumer lease, a notice in at least 10‑point bold capitalized type, substantially similar to the following: "NO PHYSICAL DAMAGE OR LIABILITY INSURANCE COVERAGE FOR BODILY INJURY OR PROPERTY DAMAGE CAUSED TO OTHERS IS INCLUDED IN THIS LEASE."
(3) Directly above the acknowledgement permitted by
subsection (c) of this Section to appear above the space reserved for the lessee's signature, a written notice substantially similar to the following:
"NOTICE TO THE LESSEE: This is a lease. You
have no ownership rights in the vehicle unless and until you exercise your option to purchase the vehicle, if this lease contains a purchase option. Do not sign this lease before you read it. Early termination may require you to pay a substantial amount. You are entitled to a completed copy of this lease when you sign it."
(c) The lessor shall deliver to the lessee a completed copy of the consumer lease signed by the lessor. Any acknowledgement by the lessee of delivery of a copy of the consumer lease shall be conspicuous and shall appear directly above the space reserved for the lessee's signature. (d) The consumer lease shall contain the names of the lessor and the lessee, the place of business of the lessor, the residence or place of business of the lessee as specified by the lessee, and a description of the vehicle, including its make, model year, model, and, if known, the vehicle's identification number or marks. (e) The consumer lease shall contain the following: (1) All items required to be disclosed by the
Consumer Leasing Act and, in addition, the following items if the items or substantially similar items are not required to be disclosed by the Consumer Leasing Act.
(2) The capitalized cost, identified as "capitalized
cost", and a descriptive explanation such as "the agreed upon amount determined at lease inception for all items and services included in the lease".
(3) Any capitalized cost reduction, using the term
"capitalized cost reduction".
(4) The adjusted capitalized cost, using the term
"adjusted capitalized cost" and a descriptive explanation, as applicable, such as "the agreed upon amount which serves as the basis for determining the base lease payment. If you are not in default, this amount plus any applicable early termination charges determines your maximum early termination obligation".
(5) If the lessee is not permitted to terminate the
lease at any time, the consumer lease shall contain a conspicuous statement setting forth any prohibitions upon the lessee's ability to terminate the consumer lease at any time before the end of the scheduled term.
(6) The vehicle's residual value, using the term
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(815 ILCS 636/1) Sec. 1. Short title. This Act may be cited as the Motor Vehicle Leasing Act. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/5) Sec. 5. Statement of intent. It is the purpose of this Act to promote the understanding of vehicle leasing in this State by providing for the disclosure of lease obligations to consumer lessees. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10) Sec. 10. Definitions and rules of construction. In this Act, unless the context or subject matter otherwise requires, the following words and phrases have the meanings set forth in the following Sections. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.5) Sec. 10.5. Adjusted capitalized cost. The amount which serves as the basis for determining the base lease payment, computed by subtracting from the capitalized cost any capitalized cost reduction. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.10) Sec. 10.10. Average periodic depreciation. The difference between the adjusted capitalized cost and the residual value divided by the number of payment periods in the consumer lease, or, for a single payment lease, divided by the number of months in the term of the lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.15) Sec. 10.15. Average periodic lease charge. The lease charge for the scheduled term of the consumer lease divided by the number of payment periods or, for a single payment lease, divided by the number of months in the term of the lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.20) Sec. 10.20. Base lease payment. That portion of the periodic lease payment which shall be the sum of (a) the average periodic lease charge and (b) the average periodic depreciation. For a single payment lease, the base lease payment is the sum of (a) the average periodic lease charge multiplied by the number of months in the term of the lease and (b) the average periodic depreciation multiplied by the number of months in the lease term. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.25) Sec. 10.25. Capitalized cost. The amount which, when reduced by the amount of the capitalized cost reduction, equals the adjusted capitalized cost. The capitalized cost includes all items which are capitalized in the lease and after the application of the capitalized cost reduction, amortizes to the residual value by the depreciation portion of the periodic lease payments over the term of the lease. For a single payment lease, the capitalized cost amortizes to the residual value by the depreciation portion of the single lease payment. The capitalized cost may include, without limitation, taxes, registration, license, acquisition, administration, assignment and other fees, and charges for insurance, for a waiver of the contractual obligation to pay the gap amount, for accessories and their installation, for delivering, servicing, repairing, or improving the vehicle, and for other services and benefits incidental to the consumer lease. It also may include, with respect to a vehicle or other property traded in connection with a lease, the unpaid balance of any amount financed under an outstanding vehicle loan agreement or vehicle retail installment contract or the unpaid portion of the early termination obligation under a lease or other obligation of the lessee. The term capitalized cost does not include any lease charge. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.30) Sec. 10.30. Capitalized cost reduction. Payments made by cash, check, rebates, or similar means that are in the nature of down payments made by the lessee and any net trade‑in allowance granted by the lessor at the inception of the consumer lease for the purpose of reducing the capitalized cost. The term capitalized cost reduction does not include any base lease payments due at the inception of the lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.35) Sec. 10.35. Conspicuous. Distinguished from other terms by type size or in some other manner. A term in at least 10‑point bold type shall be deemed to be conspicuous for the purposes of this Act. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.40) Sec. 10.40. Constant yield method. (a) In the case of a periodic payment lease, the method of determining the lease charge portion of each base lease payment pursuant to which the lease charge for each computational period is earned in advance of that period by multiplying the constant rate implicit in the lease times the balance subject to lease charge as it declines during the lease term. At any given time during the scheduled term of a periodic payment lease, the balance subject to lease charge is the difference between the adjusted capitalized cost and the sum of (i) all depreciation amounts accrued during the preceding computational periods and (ii) the first base lease payment. (b) In the case of a single payment lease, the method of determining the periodic earning of the lease charge portion of the single lease payment pursuant to which the lease charge for each computational period is earned in advance of that period by multiplying the constant rate implicit in the lease times the balance subject to lease charge as it increases during the lease term. At any given time during the term of a single payment lease, the balance subject to lease charge is determined by subtracting from the residual value the total lease charge scheduled to be earned over the lease term and adding to the difference all lease charges accrued during the preceding computational periods. (c) In the case of either a periodic payment lease or a single payment lease, the periodic lease charge calculations are based on the assumption that the holder will receive the lease payment or payments on their exact due date or dates and that the lease goes to its full term. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.45) Sec. 10.45. Consumer lease. A contract, entered into in this State, which transfers the right of possession for use of a vehicle by a natural person primarily for personal, family, or household purposes, for a period of more than one year, for a total contractual obligation not exceeding $25,000, whether or not the lessee has the option to purchase or otherwise become the owner of the vehicle at the expiration of the consumer lease. The term consumer lease does not include the following: an agreement which meets the definition of a credit sale in Regulation Z, 12 C.F.R. Section 226.2(a) or a retail installment transaction as defined by the Motor Vehicle Retail Installment Sales Act, or a lease for agricultural, business, or commercial purposes or one made to an organization. A consumer lease may include the purchase of goods, services, or benefits incidental to the lease, whether or not the purchase price is included in the capitalized cost. Unless expressly provided in the contract, a contract that substantially complies with this Act does not create a security interest in a vehicle as the term "security interest" is defined in subsection 37 of section 1‑201 of the Uniform Commercial Code. For the purpose of this definition, "total contractual obligation" is computed on the assumption that the consumer lease is not terminated before the end of the scheduled term, that there is no default, and that the lessee does not exercise any purchase option. "Total contractual obligation" includes the capitalized cost reduction; plus the scheduled lease payments over the term of the lease, or in the case of a single payment lease, the single lease payment; plus any disposition fee or other disposition charges known or calculable at the time the lease is executed. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.50) Sec. 10.50. Consumer Leasing Act. That Act of Congress codified as 15 U.S.C. 1667 et seq. and regulations promulgated pursuant thereto, as that Act and regulations may be amended from time to time. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.55) Sec. 10.55. Gap amount. The difference between the amount owed (or which would be owed in the absence of gap protection) by the lessee under the consumer lease in the event of a total loss of the vehicle prior to the end of the lease term occasioned by its theft, physical damage, or other occurrence as specified in the consumer lease and the actual cash value or portion of the actual cash value of the vehicle, actually received by the lessor from the insurance company or from any other person. The term gap amount shall not include any deductible amount applicable to an insurance policy maintained by the lessee or any past due amounts owed by the lessee as of the time of the receipt by the lessor of the insurance proceeds or any other amount due because of the lessee's default. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.60) Sec. 10.60. Gap protection. A contractual undertaking by the holder or lessor or by a third party to waive or provide that a third person shall pay the gap amount. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.65) Sec. 10.65. Group credit insurance. Group credit life insurance, group credit accident insurance, group credit accident and health insurance, group disability insurance, or group credit unemployment insurance. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.70) Sec. 10.70. Holder. The lessor or owner of a vehicle under or subject to a consumer lease and if ownership of the consumer lease is acquired by an assignee, the assignee for the period of the assignee's ownership. The term holder does not include a pledgee of a consumer lease to secure a bona fide obligation secured by the consumer lease or the owner or beneficiary of an interest in a trust that owns consumer leases. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.75) Sec. 10.75. Lease charge. The charge determined by the lessor to be paid by the lessee for the privilege of making the lease payments as scheduled under a consumer lease. The term lease charge does not include any amount included in the capitalized cost or any delinquency, default, disposition, early termination, collection, or reinstatement charge. The term lease charge does not include the amount, if any, for taxes, registration, license, acquisition, administration, assignment and other fees, and charges for insurance, for accessories or their installation, for delivering, servicing, repairing, or improving the vehicle, and for other goods, benefits, or services incidental to the consumer lease, (a) included in the capitalized cost, (b) paid for separately at lease inception by cash, check, credit card, or similar means, or (c) paid for on a periodic basis in addition to the base lease payment. The lessor may calculate lease charges on any basis. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.80) Sec. 10.80. Lessee. A natural person who leases a vehicle under a consumer lease. For purposes of Section 15 of this Act, the term also includes a natural person who makes a payment to a lessor as an advance lease payment, deposit, or down payment or who leaves his vehicle with a lessor pending the execution of a consumer lease. The term does not include a person who leases a vehicle primarily for agricultural, business, or commercial use. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.85) Sec. 10.85. Lessor. A person regularly engaged in the business of leasing or selling vehicles who leases a vehicle under a consumer lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.90) Sec. 10.90. Person. An individual, partnership, corporation, association or other group, however organized. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.95) Sec. 10.95. Precomputed lease transaction. A consumer lease transaction in which the total of the base lease payments for the term of the lease is established at the inception of the lease, whether or not it is paid at that time, as a sum comprising the total depreciation estimated for the scheduled lease term and the amount of the lease charge computed in advance for the scheduled term of the lease. A disclosure required by the Consumer Leasing Act does not in itself make a lease charge or transaction precomputed. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.100) Sec. 10.100. Realized value. The greater of (a) the price received by the lessor for disposition of the vehicle, after subtracting all actual and reasonable expenses of sale or (b) insurance proceeds in the event of the total loss or destruction of the vehicle or (c) the highest bona fide offer received by the holder for disposition of the vehicle. However, if the lessor and the lessee agree upon the realized value, the agreed upon amount shall be the realized value. The vehicle's realized value may be determined in the customary wholesale market at the time of disposition of the vehicle. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.105) Sec. 10.105. Renegotiation. The satisfaction and replacement of an existing consumer lease by a new consumer lease undertaken by the same lessee. The term renegotiation does not include (a) a deferral or extension of one or more periodic lease payments or portions of one or more periodic payments; (b) a consumer lease involving a court proceeding or the settlement of a dispute; or (c) any other agreement or event which does not constitute a "renegotiation" under the Consumer Leasing Act. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.110) Sec. 10.110. Residual value. The estimated value of the vehicle at the end of the scheduled lease term, used by the lessor in determining the base lease payment, as established by the lessor at the time the lessor and lessee enter into a consumer lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.115) Sec. 10.115. Single payment lease. A consumer lease for which a single payment is required to be paid at the beginning of the lease for the scheduled term of the lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.120) Sec. 10.120. Vehicle or motor vehicle. A motor vehicle as defined in Section 1‑146 of the Illinois Vehicle Code. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/10.125) Sec. 10.125. Words in the singular include the plural and vice versa, unless otherwise specified. The term "periodic" means "monthly", "weekly", "quarterly", or any other period as specified in the consumer lease. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/15) Sec. 15. Payment or trade‑in pending execution of consumer lease: refund or return upon non‑execution. (a) If a lessee has made a payment to a lessor pending the execution of a consumer lease, has surrendered possession of a trade‑in vehicle, or both, the lessee shall have the right, if the consumer lease application is not approved, to have any trade‑in vehicle returned promptly and receive a prompt refund of any payments made. If a lessee leaves a trade‑in vehicle with the lessor and the lessor and lessee agree that the parties shall enter into a consumer lease, the lessor shall not sell or transfer the trade‑in vehicle until the lessee and the lessor execute a consumer lease. (b) This Section shall not apply to the sale of a vehicle by a prospective lessee to a prospective lessor under a separate contract or sale if the contract is executed before the parties have consummated a consumer lease, is dated as of the sale date and is signed by the parties. The contract shall provide that the contract price establishes the vehicle's value for purposes of determining the amount the lessor will credit as a "capitalized cost reduction" under any consumer lease subsequently consummated by the parties or as the amount due as stated in subsection (a) of this Section to the lessee for the vehicle in the event the parties fail to consummate a consumer lease within 30 days; that the prospective lessee agrees to leave the contract price on deposit with the prospective lessor pending the consummation of a consumer lease for a vehicle to be ordered from the manufacturer or for a vehicle not yet in production as of the date of the contract; and that 75 days after the sale date, the prospective lessee shall be entitled to payment of the agreed upon price for the vehicle unless within that time the parties have consummated a consumer lease or have agreed to an earlier payment of the price to the prospective lessee. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/20) Sec. 20. Total loss notice and waiver of the gap amount. (a) If the consumer lease provides that the lessee shall be responsible for the gap amount, the consumer lease shall disclose that fact and disclose the obligations for which the lessee would remain liable in the event of a total loss of the vehicle prior to the end of the lease term occasioned by its theft, physical damage, or other occurrence as specified in the consumer lease, using the term "gap amount". (b) The lessor may waive its contractual right to hold the lessee liable for some or all of the gap amount. This waiver may be granted either without a separate charge to the lessee, or in exchange for the payment by the lessee of a separate charge. Any separate charge for the waiver must be conspicuously disclosed to the lessee. (c) If the lessor under subsection (b) of this Section offers for a separately stated charge to waive its contractual right to hold the lessee liable for the gap amount, the lease shall also contain a conspicuous notice which shall (1) state that for a separate charge disclosed in the notice the lessor will waive its contractual right to hold the lessee liable for the gap amount and (2) state that the lessee may as an alternative to purchasing a waiver, be able to purchase protection covering the gap amount from a company which has been authorized to do business in this State. Failure to provide the notice as required by this subsection shall invalidate any lease provision which otherwise would obligate a lessee to pay to the holder or lessor, after a total loss of the vehicle occasioned by its theft, physical damage or other occurrence as specified in the consumer lease, any of the items specified in paragraphs (5) and (6) of subsection (b) of Section 45 of this Act. No consumer lease shall be conditioned upon the lessee obtaining vehicle lessee gap protection. (d) The lessor's waiver of its contractual right to hold the lessee liable for the gap amount may be conditioned upon the receipt by the lessor of (1) all amounts due under the consumer lease as of the date of receipt by the lessor of the insurance proceeds or equivalent amount as specified in the lease or if no such date is specified, as of the date of total loss of the vehicle, (2) an amount from the lessee equal to the amount of the lessee's deductible and any other subtractions from the actual cash value under the lessee's insurance policy, and (3) insurance proceeds from the insurance policy required under the lease or the equivalent amount of the value of the vehicle. (e) No insurance or other additional license shall be required of lessors who waive or offer to waive their contractual right to hold the lessee liable for the gap amount. (Source: P.A. 89‑625, eff. 1‑1‑97.)
(815 ILCS 636/25) Sec. 25. Requirements for a consumer lease. (a) A consumer lease shall be in writing and signed by the lessor and the lessee. (b) The printed portion of the consumer lease, other than directions for completion of the consumer lease, shall be printed in a size equal to at least eight‑point type. The consumer lease shall contain the following items printed or written in a conspicuous manner: (1) At the top of the consumer lease, in at least
10‑point bold capitalized type, the words "MOTOR VEHICLE LEASE AGREEMENT".
(2) If physical damage or liability insurance
coverage for bodily injury and property damage caused to others is not included in the consumer lease, a notice in at least 10‑point bold capitalized type, substantially similar to the following: "NO PHYSICAL DAMAGE OR LIABILITY INSURANCE COVERAGE FOR BODILY INJURY OR PROPERTY DAMAGE CAUSED TO OTHERS IS INCLUDED IN THIS LEASE."
(3) Directly above the acknowledgement permitted by
subsection (c) of this Section to appear above the space reserved for the lessee's signature, a written notice substantially similar to the following:
"NOTICE TO THE LESSEE: This is a lease. You
have no ownership rights in the vehicle unless and until you exercise your option to purchase the vehicle, if this lease contains a purchase option. Do not sign this lease before you read it. Early termination may require you to pay a substantial amount. You are entitled to a completed copy of this lease when you sign it."
(c) The lessor shall deliver to the lessee a completed copy of the consumer lease signed by the lessor. Any acknowledgement by the lessee of delivery of a copy of the consumer lease shall be conspicuous and shall appear directly above the space reserved for the lessee's signature. (d) The consumer lease shall contain the names of the lessor and the lessee, the place of business of the lessor, the residence or place of business of the lessee as specified by the lessee, and a description of the vehicle, including its make, model year, model, and, if known, the vehicle's identification number or marks. (e) The consumer lease shall contain the following: (1) All items required to be disclosed by the
Consumer Leasing Act and, in addition, the following items if the items or substantially similar items are not required to be disclosed by the Consumer Leasing Act.
(2) The capitalized cost, identified as "capitalized
cost", and a descriptive explanation such as "the agreed upon amount determined at lease inception for all items and services included in the lease".
(3) Any capitalized cost reduction, using the term
"capitalized cost reduction".
(4) The adjusted capitalized cost, using the term
"adjusted capitalized cost" and a descriptive explanation, as applicable, such as "the agreed upon amount which serves as the basis for determining the base lease payment. If you are not in default, this amount plus any applicable early termination charges determines your maximum early termination obligation".
(5) If the lessee is not permitted to terminate the
lease at any time, the consumer lease shall contain a conspicuous statement setting forth any prohibitions upon the lessee's ability to terminate the consumer lease at any time before the end of the scheduled term.
