When you sign a lease contract, you must make the payments in accordance with the terms set forth in the contract, among other obligations.

Late payment

If you are unable to make your payments on time, the merchant has the 3 following options:

  • ask you to make all payments that are late;
  • send you a notice asking you to make all payments that are late, otherwise the item will be repossessed after 30 days. This notice is called a notice of repossession. The merchant cannot repossess the item before that deadline;
  • enforce a clause called a "Forfeiture of Benefit of the Term", if it is included in your contract. The merchant must send you a notice, along with a statement of account, asking you to make the late payments. If these amounts are not paid within 30 days after receiving this notice, the merchant will demand payment of every instalment provided for in the contract (both late and future payments). This notice is called a "Notice of Forfeiture of Benefit of the Term." Should you receive such a notice, you can petition the court within the 30-day deadline to be granted authorization to return the item to the merchant or change the payment terms.

In all 3 cases, you can decide to return the item to the merchant. The merchant may, however, claim payment for damages.

Last update : May 3, 2021

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The information contained on this page is presented in simple terms to make it easier to understand. It does not replace the texts of the laws and regulations.