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FOR IMMEDIATE RELEASE |
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State
Rep. Joseph Brennan |
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Brennan introduces consumer protection bill
Legislation would regulate rent-to-own center practices
HARRISBURG, Feb. 12 – State Rep. Joe Brennan, D-Lehigh/Northampton, recently introduced legislation that would regulate interest rates at rent-to-own centers.
"Since the rent-to-own industry began in the 1960s, their sales tactics and interest rates have come under scrutiny at both the state and local level," Brennan said. "Many centers charge interest rates that average 100 percent, and they often fail to disclose those rates."
Brennan's bill, H.B. 2247, would toughen rental disclosure guidelines to benefit consumers.
Under the legislation, rent-to-own centers would be mandated to:
· Reveal all fees in the original rental/purchase agreement;
· Provide statements outlining a consumer's right to terminate an agreement without charging additional fees not previously outlined in the original rental contract as long as the property is returned in good condition;
· Provide account statements to a customer upon request without an extra charge; and
· Follow the interest rate cap in Pennsylvania's criminal usury statute that prohibits charging more than 25 percent interest.
Brennan said, under the bill, centers that knowingly fail to disclose all fees or follow the criminal usury statute could result in a class C misdemeanor and be fined up to $1,000.
"Most customers of rent-to-own centers are working Americans earning weekly paychecks who rent household items like televisions, major appliances and computers," Brennan said. "The rent-to-own industry often markets to the poorest 40 percent of the United States population, the segment of the population with the fewest purchasing options and who may have the greatest difficulty understanding the complicated terms of their rent-to-own agreement."
Brennan said his legislation will help protect consumers who utilize rent-to-own centers from unknowingly entering into contracts which they cannot meet.
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