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Published: June 2012

Rental-to-own bill is a wolf in sheep’s clothing

Coalition: Americans for Financial Reform (AFR)

Consumer Action joined in a letter urging Congress to oppose H.R. 1588 that purports to protect consumers in rent-to-own contracts but ends up overruling stronger state laws.

Below is an excerpt from the text of the letter:

The chief problems with rent-to-own contracts are that they are leases masked as installment sales made at astronomic and undisclosed APRs. Under most rent-to-own contracts, the customer will pay between $1,000 and $2,400 for a TV, stereo or other major appliance worth as little as $200 used and seldom more than $600 retail new.

Although the bill’s supporters argue that it protects consumers in rent-to-own transactions, in actuality it is intended to preempt state consumer protection laws. The bill is designed to preempt the state laws providing the strongest protections for the consumers of these transactions, including the laws of Minnesota, New Jersey, Vermont and Wisconsin. Congress should not overturn state laws that prevent predatory financial practices or that provide consumers basic information about the cost of rent-to-own transactions.

Other Organizations

Arizona PIRG | Arizona Consumers Council | Arkansans Against Predatory Lending | California Reinvestment Coalition | Center for Responsible Lending | Chicago Consumer Coalition | Consumer Action | Consumer Assistance Council (Hyannis, MA) | Consumer Federation of America | Consumer Federation of the Southeast (FL) | Consumers for Auto Reliability and Safety (CARS) | Consumers League of New Jersey | Consumers Union | Demos | Empire Justice Center (NY) | Florida Consumer Action Network | Greenlining Institute | Illinois Asset Building Group (IABG) | Jacksonville Area Legal Aid (FL) | Legal Services Advocacy Project (MN) | Legal Services of New Jersey | Legal Services of Southern Piedmont (NC) | Legal Services Resource Center of Connecticut, Inc. | MCRC (Maryland Consumer Rights Coalition) | National Association of Consumer Advocates | National Community Reinvestment Coalition | National Consumer Law Center, on behalf of its low-income clients | National Fair Housing Alliance | National People's Action | Neighborhood Economic Development Advocacy Project (NEDAP)| New Jersey PIRG | North Carolina Justice Center | Policy Matters Ohio | Texas Legal Services Center | U.S. PIRG | Vermont PIRG | Virginia Citizens Consumer Council | Virginia Poverty Law Center | Wisconsin PIRG | Woodstock Institute

More Information

Oppose HR 1588 (Canseco)

Download PDF

Rental-to-own bill is a wolf in sheep’s clothing   (HR1588.pdf)