Protections for Military Members Who Lease Vehicles
September 14, 2016
The Servicemembers Civil Relief Act (SCRA) provides legal rights for military service members who have been called to active duty, including those in the armed forces, National Guard and reserve forces. One specific provision of the SCRA allows military service members and their families to terminate automobile leases if they have received Permanent Change of Station or deployment orders under certain conditions.
Arkansas Attorney General Leslie Rutledge issued today’s consumer alert to ensure Arkansas military families are aware of their rights when it comes to leasing a vehicle.
“Some families decide that leasing a vehicle is the best choice for them,” said Attorney General Rutledge. “But when new orders are issued, sometimes military families need to terminate those leases. The Servicemembers Civil Relief Act is in place to make sure that those men and women are able to continue with their military commitments without undue financial hardships, such as a vehicle lease.”
The SCRA allows auto leases to be terminated if one of the following requirements is met:
- The lease was taken out prior to joining the military and service orders are for longer than 180 days.
- The lease was taken out while on active duty but the service member received Permanent Change of Station orders to a location outside their current state or deployment orders to last at least 180 days.
To terminate the lease, written notification of the intent to break the lease, along with copies of the military orders, must be given to the creditor. The vehicle must then be surrendered within 15 days of giving notice, and the termination is effective upon vehicle surrender.
The SCRA explains that any prepaid lease payments beyond the surrender date must be refunded to the lessee within 30 days and the lessee cannot be charged for early termination fees. The creditor is also prohibited, under the SCRA, from making an adverse report about the lease termination to a consumer credit reporting agency and from retaining a lessee’s security deposit in anticipation of money owed.
Arkansas military service members, veterans and families should file consumer complaints with the Attorney General’s office on ArkansasAG.gov or by calling (800) 482-8982.
For more information about other consumer-related issues, contact the Arkansas Attorney General’s office at (800) 482-8982 or consumer@ArkansasAG.gov or visit ArkansasAG.gov or facebook.com/AGLeslieRutledge.