Rent-A-Center and their ilk

Where does “ilk” come from?

Anyway it appears from a flyer for $129/month for 24 months I can have a laptop which costs about $1600 to buy outright from them. I can understand some reasons why someone might do this, although in almost all cases it seems like a very bad idea. But who are the typical customers of these places?

People who wish they could rack up credit card debt but doesn’t have a high enough credit card score to get a card? I assume this is their target customer.

But then I wonder if you could rent items for a month or so, like a big screen TV around Superbowl time, which would be a lot cheaper then buying one that you don’t really need. Perhaps the rental place is hoping that you will like it so much, or just to return it on time and have to pay another month. Is it OK to return items after just a month or 2, or is their a contract like the cellphones have which locks you in?

Anyone have any experence to share about these places?

You’re right on the target audience: While middle-class people use their credit cards to live like the rich, lower-class people use rent-to-own to the same effect. Much of it winds up in the pawnshop when a new shiny thing catches their eye.

I don’t how how it works now, but years ago I looked into renting a big screen for an event and they didn’t have one available for a day or a weekend, but if I was willing to sign the two-year agreement one would suddenly become available. It’s much like the lowest price dealers on Pricewatch who can sell you the complete kit today, or wait until the tenth of never if you want just the basic product.

The contract, of course, isn’t designed to let you off the hook easily. You’re right, they’re pretty much like a cellphone. The difference is that, instead of merely shutting off service they come to your house with the “shame wagon” and take back whatever you rented, sherrif’s deputy in tow in case you don’t let them in. Then you get to enjoy the feeling of your neighbors seeing Colortyme/RaC employees take an inordinate amount of time carrying “your” furniture out of your house. I’ve seen some truly heartbreaking examples.

From the OED:

I have a friend who bought a DVD player from Rent-a-Center. She did it because she’s a deadbeat and doesn’t pay her bills, so they’re the only ones that will work with her. Then, when she didn’t make the payments (a lousy $20/mo), they came and took it away, and were that much wealthier for having dealt with her. They’ll rent it to another deadbeat who can’t pay, and they’ll probably get 10 times the value of the item before someone bothers to just buy it outright.

They expect you to rent-to-own, and will hound you consistently about it, but there’s no rule that you have to. You can just rent stuff by the week.

Several months ago, I was in need of a video camera–something I use rarely enough to not be of any sense to buy. I looked for camera rental stores, but they don’t seem to exist here, so I tried Rent-A-Center. Their stock is crap and horribly used, but in desperation, I rented one for a week.

They kept pushing the rent-to-own concept, but when they mentioned the payments (after much assurance that I just wanted it a week), I had no choice but to laugh in their face and ask them why I would make enormous monthly payments eventually totaling two and a half times the retail cost for a three year old used camera missing most of its accessories and without a manual. First they seemed confused and afraid that I understood the Mysteries of Math, then they just let me rent it for a week and be on my way.

On returning, the guy at the counter began making the pitch again, but once the person on the floor (who I had rented the thing from) came, he just finished it up and took the camera. Perhaps they only go after likely pigeons.

The RAC here had a beautiful curio cabinet in the window at the time I was looking for one. I went in the store, only to discover the cabinet wasn’t quite as nice looking up close - my guess was that it had been “rented” and wasn’t “picked up” very gently when it was repo’d. I asked the guy how much the cabinet cost, and the starts looking up “rental” payments. I said "No, I don’t want to rent it, I’m interested in buying it. So he multiplied the payments out and told me I would pay $1500 for a cabinet that was worth about $800 without the dings in the finish. Poor guy just looked confused when I started
laughing at him and walked out of the store.

Some useful links to info about the industry:

http://www.ftc.gov/reports/renttoown/rtosummary.htm

http://www.doj.nh.gov/consumer/sourcebook/rent_own.html

http://www.ararental.org/

I used it when I was an intern. We were living four guys to a two-bedroom apartment and needed some bunk beds. So we went to RAC and rented them for a few months. We could have probably found some cheaper but RAC brought them over, set them up, and took them away when we were done with them. It was definitley worth it.

I would suspect we weren’t the typical user of RAC, however. Going to the ghetto strip mall to find them was an eye-opening experience for a couple kids new to DC. I think the more typical user is like my sister-in-law, who has used RAC in the past. She has horrible credit and simply won’t find anyone else to give her financing to purchase furniture or anything of that sort. So she goes to RAC. Sure, in the long-run she’s paying a lot more for furniture than she would at Marlo’s or the Furniture Store, but that’s the price you pay for being a deadbeat in the past. These stores serve a purpose for people who don’t have good credit. Without them these folks would be even more screwed than they are now.

Actually the last link that I posted should be replaced by this one:

http://www.aprovision.org/

The other is the trade association for equipment rental businesses.

My sister-in-law used to manage a RAC. Most of her customers were people who didn’t have the credit to buy outright the 72" projection TV. She also had customers that liked changing their furniture often, and didn’t want to buy it, so they rented it for a couple of months, then swapped for something else.

Mostly is seems to be used by people that like to live beyond their means.

According to this, the keep rate around 25%, so 75% of renters do not wind up keeping what they rent.

And see, http://www.aprovision.org/industrystats.html#transactionprofile.

I used a rental place when i worked on a 3 month contract to get the basic furniture and a tv for a studio - they had already furnished studios and it was actually cheaper to rent furniture. I didn’t want to buy the furniture because it was only for 3 months, and i already had furniture at my regular home [well, my parents, i was living with my parents at the time…]

I do know right now we are buying our car from an automotive equivalent…one of these half down and $50 a week for the balance places. We didn’t have to do any credit check, the amount to replace my car came out to half the cost of the replacement car [mrAru rolled my car at the beginning of june] and it oddly enough comes out to the same amount I had been making in monthly payments from the credit union where I had originally gotten my car loan from when I bought the original car.

I’m one of the customers of a rent-to-own place.

It’s true our credit stinks, but it’s not because we tried to charge the hell out of everything, then refuse to pay for it. We got slammed with a lot of very bad things, medical bills, major car trouble etc. and were forced into bankruptcy. I don’t know why, I just felt the need to clarify that I’m not a “deadbeat”.

In my situation, I felt like we didn’t have a choice. In the span of one month, my clothes dryer, oven and refrigerator all stopped working. They were very old and I knew they weren’t going to last forever, but I am so up to my neck trying to pay off some medical bills that occured after the bankruptcy that I couldn’t save any money for emergencies.

The place I went to was very nice. There is not a lot of used item and the ones that are used are clearly marked as used. In one day they brought my appliances to my house and the delivery guys were the best I’ve ever seen.

A few month later, I called the manager of the store to see what my options were to get out of the rental cycle. He told me that I could either give up the stuff and they would come and get it and I would owe a penny, or I could just pay the cash balance which was less then it would have been had I purchaed it at Sear’s or something. Part of the rent went towards a purchace price.

I had the money to pay one appliance outright and I did. I’m still paying for the other two, but that will change in time. My car didn’t run a few times and the delivery guys had no problem stopping by my house so I wasn’t late on my payments.

For me, it worked and helped me out a lot. But the store does have a lot of big ticket toys there too. Maybe part of the reason it worked for me is that I don’t feel the need to buy big, expensive toys I can’t afford.

Way back when I moved from the college dorm to my first apartment, I needed furniture. I rented just the pieces I needed from one of these places on a monthly basis (but did not sign a long lease). As I could either afford to buy new, or more often, found a good replacement piece at a garage sale (or other students’ moving out sales), I replaced pieces and returned them until I had my own crappy furniture to replace the rented crappy furniture.

Slight hijack, but if you’re thinking about going to a rent-a-center, try something like craigslist.org or the classifieds first. Freecycle is a good resource too if there’s one in your area.

You can get furniture, appliances, and electronics very cheaply. They may not be in new condition, but you can own it for the price of a few of the rental payments.