Senator Denounces Rent-to-own Industry

New York’s senior senator, Charles E. Schumer, is no fan of the rent-to-own industry.  He has recently unveiled legislation that could sharply curtail many of that industry’s practices and cap prices nationwide.

Schumer went for the dramatic when he held a press conference discussing his plan: he stood in front of a Rent-a-Center store.

Schumer believes that rent-to-own operations take advantage of less savvy consumers, and targets residents who “lack the disposable income and access to credit cards” to purchase items at competitive prices. As a result, he said, those consumers pay “astronomical” prices for such items such as televisions, air conditioners, refrigerators and computers.

“For too many years, the rent-to-own industry in Buffalo has used smoke and mirrors to prey on uninformed customers whose only fault is their need for basis household goods,” he said. “Like highway bandits, [they] have searched out consumers across the city and milked them out of hundreds and sometimes thousands of dollars.”

Industry officials, of course, aren’t big fans of Schumer or his plans; they have said that they will oppose such legislation, but hope to work with Schumer and others to “educate and work closely with our elected leaders who are out there doing their job,” said Richard May, spokesman for the Association of Progressive Rental Organizations, a trade group in Austin, Texas.

His new bill, the Rent-to- Own Reform Act of 2007, would mandate stronger disclosure of prices and fees, and would characterize such payments as finance charges subject to state interest rate caps.