Rent-A-Center accused of harassing, taking advantage of customers
Filed under: Ripoffs and Scams, Shopping, Consumer Complaints, Buyer Beware, Consumer Ally
Accusing Rent-A-Center of using collection tactics and charging fees just this side of a loan shark, Washington state is asking a judge to declare the practices illegal and halt them.The allegations are another black eye to the business of renting furniture, electronics and appliances to those who can't otherwise get credit or afford to buy at a regular store.
Instead, those who go to Rent-A-Center and its competitors can get items for what might seem to be an affordable payment that ends up costing them many times the actual price.
Rent-A-Center markets itself as giving opportunity to those who wouldn't otherwise have a chance to get the items it leases and is using the popular retired basketball star Ervin "Magic" Johnson in television spots.
Some examples of what Washington officials say certain items cost consumers who were making weekly payments (payments can be made weekly, biweekly or monthly):
- $6,594 for a used television
- $3,585 for a refrigerator
- $4,073 for a laptop computer
Washington state Attorney General Rob McKenna is taking Rent-A-Center to court to try to get the company's collection tactics and rental contracts declared illegal. McKenna asserts Rent-A-Center goes after those who owe with a vengeance -- coming to their homes, threatening customers, their children and harassing relatives and neighbors.
"While companies certainly have the right to collect on outstanding debts, state law, along with the most basic standards of common courtesy, dictate how companies may collect on those debts," McKenna said in a statement. "Attempting to kick doors down, calling the debtor's friends and relatives, and scaring their children aren't included in those basic standards."
California won a $7 million judgment against Rent-A-Center in 2006 over its price disclosure policies. The company settled a class-action case in New Jersey for $109 million after being accused of charging interest in excess of what state law permits.
Rent-A-Center Vice President Xavier Dominicis said the company is getting a bad rap and that the tactics alleged are neither permitted nor tolerated.
"We have a very exacting and exhaustive collection policy in place," he told WalletPop. "We have zero tolerance for non-compliance. We wouldn't allow anything like that. We probably have a more stringent policy about collections that we need to have."
Dominicis said the "much-maligned" rent-to-own business has a place and its success shows that. The complaints, he said, represent a tiny fraction of the company's overall business.
"We make life manageable for everyday Americans," Dominicis said. "It's a week-to-week program so there is no debt. It's a program that has proven very helpful to everyday Americans particularly in a sour economy."
He said many of the calls to customers' homes are to determine whether they intend to keep renting the items. Only 5 percent of all customers, Dominicis said, make every payment and purchase products at the oft-cited extraordinarily high prices.
McKenna's office used the example of Carol Hammons, who said she stopped paying Rent-A-Center to protest renting her ripped and broken furniture. In a sworn statement, the woman said Rent-A-Center employees came to her home, where two girls were watching Hammons' 11-year-old autistic daughter. The employees, she said, refused to leave, told the girls she would be arrested and then told her neighbors personal financial information and accused her of passing bad checks.
The state accused Texas-based Rent-A-Center, which has more than 3,000 stores nationwide, of using abusive language and profanity in its collection efforts -- including referred to customers as "ghetto trash," "deadbeat," and "thief," among others.
Washington officials said Rent-A-Center employees have demanded money from babysitters and others when the customer isn't home, pounded on doors, peered through windows and told children their parents would be thrown in jail if they don't pay up. When challenged by consumers that what they're doing is illegal, Washington officials said Rent-A-Center employees have responded that collection laws that forbid such harassment don't apply to them.
"Because of a loophole in state and federal laws that apply to debt collection, Rent-A-Center employees believe they can use harassing tactics to collect from renters who are late on their payments." Assistant Attorney General Jim Sugarman said.
Rent-A-Center is due to report its second-quarter earnings on Tuesday.
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Gotcha Moments of Retail Shame
Many companies get caught for unfair practices against customers, like Rent-A-Center, recently. Click through to see more stores that got caught cheating.
Mark Humphrey, AP
AP
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Reader Comments (Page 1 of 13)
8-01-2009 @ 8:21AM
azdiyygal said...
Of course they are acting like loan sharrks, but why aren't they going after the credit card companies who are doing the same thing?
Reply
7-27-2009 @ 5:49PM
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7-27-2009 @ 6:22PM
brad said...
You are abosolutely right. The card companies are by far worse than the rent to own places and many more are affected by the card companies than the rto companies.
7-27-2009 @ 6:49PM
Lynn said...
Colllection agencies are even WORSE! There's one out there who robocalls people one an hour during every waking hour of the day. I think Chase Bank just switched to another collection agency because of that crap ....
Pawn brokers are a less expensive way to buy a TV or Computer. Those rental places charge you the rental price PLUS the purchase price ... and most of the people who deal with them are not experienced enough to pick up on that one, and end up getting ripped off!
Lynn in New Orleans, LA.
7-27-2009 @ 7:40PM
Mark said...
Every economically disadvantaged suburb has RAC's, Pawn Shops,
Package/Liquor Marts, PayDay Cash Loans, and Car Title Loan
businesses precisely for one major reason.......Law Maker's made it
Legal!!! Many State Law Maker's actually OWN these types of
businesses. The economically disadvantaged are EASY TARGETs for
outrageous profit taking...where else are they going to go to capture
all the hollow glittering prizes the Madison Avenue propaganda machine
says you MUST HAVE to BE SOMEBODY!!!...What Bullsheeit!!
7-28-2009 @ 2:54PM
roboprep said...
They are the worst. They called me trying to get info on my father. Whom I might say have no contact with. When I told them that I had no contact info for him, They continued to tell me that if I did not tell them a phone # or address they would be sueing me for the balance. This is against the law and I asked for a supervisor. Here is a good reason why we should be able to record all conversations. I would have sued there pants of if I could prove it!
The second time I had a run in with them they were pounding on a door of rental property I own. I hold them to stop before the damaged the door. They said that I had to let them in because the renter had stolen property. I told them that they needed a judgement and a Marshall before I would let them in. I had to tell them I was going to call the police to get rid of them!
Somebody has needed to do something about this for lonf time!!!
7-28-2009 @ 4:10PM
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7-28-2009 @ 4:27PM
candice said...
I have got stuff from rent a center and they ripe me off because me and my boyfriend returned our stuff and how they tell you if you ever come back to get any thing in the future they will use the money that you have payed them and use it on any thing that you get and they didn't and that made me mad and my boyfriend said there was nothing we could do about it. So ever one who is ever thinking about going to rent a center don't they will ripe you off.
7-27-2009 @ 3:18PM
Steve said...
Close those thieves down.
Reply
7-27-2009 @ 5:04PM
Robin said...
They should be closed down here in pa one of the RAC drivers hit a elderly lady and kept right on going. The incident was hushed so Im not sure the outcome but I refuse to get anything from them.
7-28-2009 @ 4:34PM
bill vardy said...
This comment isn't just to Steve but to all out there with negative attitudes towards Rent to Own such as RAC and others. If you're going to suggest RAC shut down then I suppose all Homeowners who rent to tenants ought to be shut down too. Think about what many folks in this country charge for run down shacks (and you can bet many of the politicians out there do) and refuse to do any repairs etc. Are we going to come to the place in this country where we regulate or obomulate every industry that exist? You folks are the idiots who want it to happen..
7-27-2009 @ 3:23PM
joey3quarters said...
What i cant understand is if i was in the street doing what rac doe's i would be busted in a heart beat .They must give kick backs from someone .Hey stupid people stop it with rac then want your money back when you find out it was a rip off.This company has been robbing for years and decades OPEN YOUR EYE'S PEOPLE......
Reply
7-27-2009 @ 3:30PM
Libby said...
Aarons is exactly the same way...I was buying washer/dryer set.
I was so excited, but later took a good look at my papers, They ended up costing me 2500.00. And, after the third month, the payments were split. half went on the items, the other half to the store. I called them and told them I was moving to come and get them, they didn't, so now they say I still owe them 970.00.
I think they got the items and resold them, trying to make a huge profit off me.
Reply
7-28-2009 @ 7:48PM
RSpreier said...
..and later looked at my paperwork? You didn't read it BEFORE you signed it? The whole point is you don't have to agree to anything you don't want to. My guess is you wanted the washer and dryer but nobody on the planet would finance you because you have never paid your bills. These places exist because of irresponsible people like you. To blame them for your stupidity is moronic.
7-27-2009 @ 3:27PM
chris said...
I hope they check out Aaron's rental!!!!
I had a terrible experience with them doing the same thing!
Reply
7-28-2009 @ 3:50PM
tee said...
i agree!!! aarons is just as bad as RAC. i will never buy anything or "rent" anything from them again. its just a pain. the new rule is if i can't buy it now, i dont get it!
7-27-2009 @ 3:28PM
Jane said...
Rent-a-center and other companies have done this for years. How fitting they are now getting a just do. I had an experience with my Father in law and a rental company like rent-a-center, we were on the phone with the supervisor ( payment was 1 day late due to pay schedule) and were working it out with him, when a knock on the door and answered it to see one of their workers at the door, myself not being the account holder was told if my father-in-law did not pay today, that they would call and come to the house every day until he made a payment. I myself told the guy if thats how your going to treat a customer of over 20 years then take your computer with you. I was told we would have to schedule a pick-up. I said nope I will have it in the office in 15 minutes, your not welcomed here. I undid the computer system, loaded it in my car and brought it to them , in which they were 4 blocks from the house. Once their the officer worker and supervisor was like you didnt have to do that. I said take your computer and shove it, not only did we have problems even though brand new, you never gave us the disk or anything else, not to mention the fact you passworded it so that I could not correct the issues myself. We no longer want it, and because we were on the phone with you and your men over there came to the house and threatened me the account is to be marked paid in full and I want a copy now not mailed to me. They did as I said, and we havent used them since nor will we recommend them to anyone because of the hassles we had over and over. Like the cost. I hope they have to pay out what they over charged.
Reply
7-27-2009 @ 6:03PM
Jon said...
i totally agree. They charge way too much for the rental fees and other things. I have a 60 inch HD tv in my living room , but i wanted a 40 inch for the bedroom. I rented the 40 inch from RAC and their payment a week was $44.99. But it seemed every week the payment kept going up. The $44.99 a week was actually $53 a week. They said i had to pay for insurance. I said "Im not paying for insurance, you guys are already insured". They always seem to come up with a different total every week that seemed to just get higher all the time.
So after 3 months i was late by 2 DAYS!! , and they sent their harrassment team out to get me. I would get about 20 calls a day from all their employees and i got tired of it so i sent the tv back. So they just got 3 months of free money from me for nothing.
Also,, they rent out used and sometimes damaged items that they dont cut the price down. Thats like me going into a Best Buy and buying a new tv but getting a used tv for the price of a new one. So if say a bedroom set is $100 a week new,, if i returned it one day and it had a scratch and some scrapes on the furniture, RAC will just go and rented it out again for the same $100 a week. These guys are making money hand over fist and renting from new to used to damaged items for the price of a new item to customers who are being suckered in by RAC.
RAC knows people are getting somewhat a deal only because the customers cant afford it new so RAC knows they can sucker the people for merchandise thats used for the price of a new item and thats where RAC wins.
RAC NEEDS TO CLOSE DOWN! THEYVE BEEN RIPPING EVERYBODY OFF FOR DECADES. The employees know they would never fall for this scam so why should they care.
7-27-2009 @ 3:30PM
DanNDenver said...
Rent to own, payday loans, credit card companies and banks with their outragous fees and charges. They all target and prey on the poor, unsophisticated and uneducated but when challenged they claim they provide a necessary public good. They must think we live in some kind of bizarro world or they think we're all stupid. The abuses have become so obscene I would hope that even congress can see them and will finally step in to stop these piranhas. If I had my way they would all be shut down this afternoon, all profits disgorged and the principles locked up and the key thrown away.
Reply
7-27-2009 @ 3:29PM
Robert J said...
I know all to well about their collection practices it happens all over Ohio, I have seen many people threatened and actually had doors kicked in from R.A.C. employees . I do not do business with them or any rental business . I am not saying I have went witout having something I needed , I just had to figure out how to save enough to buy used somewhere else or from someone .
Reply