Rent to Own
Rent to own stores are in the business of selling furniture, appliances and electronics by purported leases. The N.J. companies historically would allow the consumer to return the goods at any time and stop paying. However if the consumer wanted to buy the furniture, he or she would have to make payments for one and one half years. Class action suits alleged that some RTO contracts charged interest over 30 percent! In Perez v. Rent-a-Center, 186 N.J. 188 (2006), the New Jersey Supreme Court agreed with the consumers and with CLNJ's amicus brief - ruling that the N.J. Retail Installment Sales Act applied to rent to own contracts. The Supreme Court held that rent to own contracts must not charge more than 30 percent interest, which is the limit of the N.J. criminal usury law. Thousands of consumers received refunds in settlement. Funds left over from the settlement were distributed to Legal Services law firms which represent the poor.
Consumers League of New Jersey opposed bills in the N.J. Legislature which would allow rent to own stores exemptions from normal consumer protection laws. CLNJ opposed bills to allow rent to own stores to charge double the cash price. CLNJ opposed bills to allow RTO stores to have unlimited interest. The N.J. Public Interest Research Group, USPIRG, LSNJ and other consumer groups lobbied against these bad bills, which fortunately were not enacted. In other states, New York for example, the RTO lobbyists succeeded in getting laws passed to allow RTO to charge high prices.
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Listen to the RENT TO OWN RAP a public service announcement in Rap form. Click on the â–º below.
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In Pennsylvania, in 2024 the Attorney General obtained $864,466 in refunds for rent to own victims alleging that Progressive Leasing, a Utah-based rent-to-own company, failed to comply with the Pennsylvania law that required RTO stores to place physical tags with complete financing cost information on the goods offered for rent.
CLNJ’s advice: there are better ways to buy furniture than rent to own. Try for a department store card.​​
"Rent to Own Rap"
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Copyright 1991 by Consumers League Education Fund
Produced by Flo Powell and Mark Fogarty
Lyrics: Mark Fogarty
Music: Jerard Snell
Rapper: TAC
Backing vocals: Jerard Snell and Tim Shider
Voiceover: Flo Powell
Emgineered by: Tim Shider
Cover art: Peter Kelly
Layout & Pasteup: Bob Solomon
Have you heard about the latest ripoff scheme?
It's called rent to own and it's really mean.
Sell you a radio, appliance or TV
Charge you a twenty just to rent it weekly.
By the time you get to own it, your paycheck's blown
Costs five times what it's worth to own.
DUM DUM DEE DUM DUM DUM DEE DUM DUM- DUMB RENT TO OWN!
Now rent to own is really bent,
Can end up costing 'bout 300 percent.
With rent to own, your money's blown,
You keep on paying until you turn to stone.
On weekly payments your cash will go.
A thousand dollar TV? No no no!
DUM DUM DEE DUM DUM DUM DEE DUM DUM- DUMB RENT TO OWN!
Appliances? DUMB RENT TO OWN!
TVs? DUMB RENT TO OWN!
Anything they sell? DUMB RENT TO OWN!