Rent-to-own

[8] Though not obligated to do so, the consumer can choose to continue making interval payments on the merchandise for a pre-specified period of time, at which point they would own the good outright.

[9] An alternative purchase option is commonly provisioned for, allowing the consumer to pay off the remaining balance on the agreement at any point in time in order to obtain permanent ownership.

In addition, some survey respondents reported poor treatment by employees in connection with late rental payments, problems with repair services, and hidden or added costs.

[11] Often mentioned alongside most critiques is the question of whether prices paid for services of this type are adequate for lower-income individuals who can least afford additional financial outlays.

[28] Later in the same year, the Department of Defense ultimately concluded that rent-to-own was not a form of credit and excluded it from its regulation on predatory lending practices.

[31] While rent-to-own transactions are most commonly conducted for purchasing consumer goods at a retail store, this term also describes a specialized real estate agreement.

[32] Because the most recent housing market downturn was accompanied by protective regulatory scrutiny of lending practices and consumer credit agencies, acquiring a loan has become more difficult for Subprime borrowers.

People with poor credit find the leasing period a crucial opportunity to repair their financial profile to secure a loan.

[35] At the end of the lease term, the tenant is offered right of first refusal to purchase the property at the agreed upon sale price, or walk away and forfeit the deposit.

[36] If the tenant is unable or unwilling to exercise the option to buy, the owner is then free to rent or sell the property to another buyer, or to restructure the contract.