The Downside of Rent-To-Own Contracts

Josh Lawhorn Mississippi Bankruptcy AttorneyEvery day, I meet with people to discuss their finances. One common subject is classifying the type of debts that they have. Rent-to-own contracts have become all too common in today’s financial market. Many people are unable to acquire standard financing so they turn to alternate methods to acquire property. While it may seem like a deal at the time, it usually ends up costing more in the long run.

Rent to Own Costs You More

Even though traditional retail installment contracts can have excessively high finance charges, they rarely compare to the markup of rent-to-own contracts. In a recent Washington Post article, an example is given where a $1,500.00 sofa ends up costing $4,150.00 in a rent-to-own agreement. It is also noted that around 75 percent of rent-to-own agreements are either returned or repossessed.

While the overall terms of the agreement may seem obviously predatory, the low payments continually lure individuals into the contracts. Rent-to-own retailers have increased exponentially since the financial crisis of 2008. With the decreased income of the working class, fewer people are approved for traditional finance agreements. Rent-to-own companies have taken advantage of this market and profited greatly, much to the detriment of the everyday American.

Upside-Down Capitalism

Recently, officials in Vermont called for legislation requiring tighter regulation on rent-to-own companies. They labeled it “upside-down capitalism” because the agreements charge the poorest citizens the highest prices. While the companies behind the agreements praise the benefits of the contracts, the high mark up clearly negates any short term advantage.

If you find yourself locked to a financial obligation that you can no longer pay, regardless of the type, we can help. Call our office nearest you to set up a confidential consultation with one of our experienced attorneys.

 

Related Information

 

Share This Page

Bond & Botes Law Offices

At Bond & Botes, we now offer full service bankruptcy consultation and filing over the phone or by video from the comfort and safety of your home or office. Please call 1-877-581-3396 or click here to setup your free phone or video consultation.

The lawyers at the Bond & Botes affiliated offices serve clients at offices in Anniston, Birmingham, Mobile, Montgomery, Opelika, Decatur, Huntsville, Florence, Haleyville and Gadsden, Alabama; Vicksburg, Hattiesburg and Jackson, Mississippi. Read our disclaimer here. You can view our Privacy Policy here.

Alabama Offices

Birmingham

2107 5th Avenue North
Age-Herald Building
Birmingham, Alabama 35203
Phone: (205) 802-2200


Shelby County Location
15 Southlake Lane, Ste 140
Birmingham, AL 35244
Phone: (205) 802-2200


Florence Location
121 S. Court Street
Florence, AL 35630
Phone: (256) 760-1010


Huntsville Location
225 Pratt Avenue NE
Huntsville, AL 35801
Phone: (256) 539-9899


Montgomery Location
311 Catoma Street
Montgomery, AL 36104
Phone: (334) 264-3363


Decatur Location
605 Bank Street
Decatur, AL 35601
Phone: (256) 355-2447


Haleyville Location
914 19th St.
Haleyville, AL 35565
Phone: (205) 486-3580


Gadsden Location
430-B Chestnut Street
Gadsden, AL 35901
Phone: (256) 485-0195


Opelika Location
216 South 8th Street
Opelika 36801
Phone: (334) 887-7666


Anniston Location
1302 Noble St #2C
Anniston, AL 36201
Phone: (256) 344-3559


Cullman Location
200 Second Avenue SW
Cullman, AL 35055
Phone: (256) 739-9866


Mississippi Offices

Jackson Location
5760 I-55 North, Ste 100
Jackson, MS 39211
Phone: (601) 353-5000


Hattiesburg Location
607 Corinne St, Ste B8
Hattiesburg, MS 39401
Phone: (601) 264-7200


Vicksburg Location
1212 Farmer Street
Vicksburg, MS 39180
Phone: (601) 353-5000

© 2024 by Bond & Botes Law Offices. All rights reserved. Disclaimer | Privacy Policy