[20070418]RS21467_消费者租购协议.pdf

Order Code RS21467Updated April 18, 2007Consumer Rental-Purchase (Rent-To-Own) AgreementsPauline SmaleEconomic AnalystGovernment and Finance DivisionSummaryA rent-to-own arrangement provides an alternative to purchasing merchandise. Ina rent-to-own transaction (also known as a rental-purchase) the consumer agrees to aself-renewing weekly or monthly lease to rent a merchandise item. The terms of thelease include an option to purchase the item. Dealers in the rent-to-own industrytypically offer high cost, durable, household items such as furniture, appliances, andhome electronics. The industry attracts consumers who may have a hard time qualifyingfor credit, do not have enough cash for a purchase, and are unable or unwilling to waitand save for an item. The major downside to these arrangements is the final purchaseprice of the rent-to-own merchandise is much greater than the price of the same itembought from a retail store or financed over time.Currently, rental-purchase transactions are not specifically regulated by federal law.For more than a decade, there has been considerable debate over the need for regulationof the rent-to-own industry. A recent Federal Trade Commission (FTC) s