The best way to get a positive return on your money is by getting rid of expenses that eat up your money. One of the biggest cash eating expenses can be found in the rent-to-own industry. Companies like Rent-A-Center, Rentway, and Aaron’s Rents advertise that you can buy just about anything you need for a few dollars a week. It doesn’t even take credit to qualify. All you need is a job, a place to live, and references. This sounds too good to be true, doesn’t it? Well it is!
Renting To Own Will Leave You Flat Broke
Renting To Own – Since rent-to-own companies rent necessary household items (furniture, televisions, computers, washers, and dryers) to customers that unable to qualify for financing; they charge these companies exorbitantly high fees for the privilege of renting. Customers end up paying much more than the retail price of the item. This makes renting to own one of the biggest rip-offs going. $20 a week doesn’t seem like much until you realize the total cost you are paying. A $1,000 laptop will end up costing you over $3,000, just by paying $29.95 a week for 2 years. A $500 washing machine will end up costing you over $1,500 just by making a $15 monthly payment for 100 weeks. Companies like Rent-A-Center and Aaron’s Rents will have you paying three to four times the true cost of an item.
Renting To Own Is Just Another Form Of Predatory Lending
Renting to own is another form of predatory lenders. Just like with subprime loans, payday loans, and pawnshops lower income people are the ones being taken advantage of. Rental companies claim that they do not charge any interest but that is not true. By the time you add in insurance costs, contract fees, and the huge markup on goods, you will be paying an APR in the hundred’s. You just can’t win renting an item from a rent to own company. Companies like Rent A Center mark their products up at least 100%. So, even if you paid for your purchase in full on Day 1, you would lose money. Do you need more evidence that rent-to-own companies are predatory lenders? They have now gotten into the “financial services industry” as well. They now offer cash advances, check cashing, money orders, and prepaid debit cards. These are clear cut signs that these companies do not exist to help customers but to hurt customers.
Buyer beware! Your best bet is to stay away from rent-to-own companies.
Photo by: burningkarma
