Massachusetts Senate Bill 2434 (SB 2343) titled “an Act relative to motor vehicle leasing parity,” was referred to the Senate Committee on Transportation in late February. If passed, the bill would strengthen the rights of leaseholders in several chapters of state law and align leasing protections with those long granted to car buyers.
Under the bill, motor vehicle leases can be voided by lessees under certain circumstances and leased vehicles would be included in the state’s “lemon law” and consumer credit statutes, and be subject to strict disclosure standards and protections against inflated vehicle valuations. In addition, dealers would face triple damages for fraud or deceit in leasing transactions, and repossession rules would require written notice, court hearings, and grace periods for cure and redemption.
Notable Changes Proposed in Massachusetts Senate Bill 2434
Inclusion of Lessees under Used Vehicle Laws. The amendment of the definition of “buyer” and “consumer” to include “lessee” and the addition of the words “or leased” after “sold” in various instances effectively extending certain consumer protection provisions related to the sale of used motor vehicles to the leasing of used motor vehicles.
The bill also seeks to amend the definition of “Purchase price” to “the total of all payments made for the purchase or lease of a vehicle, including but not limited to any finance charges, registration fees, payments made for credit life, accident, health, and damage insurance, and collision and related comprehensive insurance coverages and service contracts and the value of a trade-in…”
Right to Void a Lease for Failure to Pass Inspection. If a vehicle fails to pass inspection within seven days of the sale or lease date, the leaseholder can void the lease or sale for a full refund.
- Provided the defects were not due to abuse or an accident after the lease date and repairs exceed 10% of the total lease obligation.
- Leaseholders must notify and return the vehicle to the dealer within 14 days of the lease date and include a written statement from the inspection station detailing the reasons for failure and repair costs.
Regulation of Lease Value Representation. Expands the state’s “lemon law” and consumer credit statutes to include leased vehicles, defines clear protections against inflated vehicle valuations in lease agreements, and imposes strict disclosure standards.
Banking Commissioner Gains Oversight. The Massachusetts Commissioner of Banks will have expanded authority to enforce consumer protections in vehicle leasing. Specifically, the Commissioner will be able to issue rules consistent with the federal Consumer Leasing Act and Regulation M. Until the Commissioner issues state-specific regulations that offer equal or greater protections, lessors – dealers – in Massachusetts must comply with the federal standards.
What This Means
Senate Bill 2434 seeks to ensure Massachusetts consumers receive baseline protections guaranteed by federal law, such as clear disclosures of lease terms, fees, and obligations. It also positions the Commissioner as a key regulatory authority in maintaining transparency and fairness in the state’s leasing market.
With the CFPB perceived to be less active, Senate Bill 2434 reflects a broader trend of state-led efforts to bolster consumer safeguards—especially in complex finance agreements like auto leases.
The bill was referred to the Senate Committee on Transportation in late February.
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