07-03-02
RTO Online

Rent to Own Online Government Workshop new Rent to Own and Government New Side By Side Comparison of Any State Statute to the Proposed Federal Legislation Related articles most recent first 109th Congress Consumer Rental Purchase Agreement Act of 2005 Introduced In Senate Opposing Forces; Two Groups At Legislative Odds 108th Congress Session Ends Without Passage Of Rental Purchase Agreement Act; Last Minute Efforts Nearly Win The Day Senate Finance Committee Ranking Member Endorses Rental Purchase Agreement Act Rental Purchase Act Looses 5 Key Supporters Schrock And Clay Cosponsor Rental Purchase Agreement Act Text Of Landrieu Statement To The Senate Banking Committee Supporting The Consumer Rental Purchase Agreement Act "Even Congressmen Use Rent to Own"; Senator Mary Landrieu Opening Statement Audio Senate To Hear Testimony On Rental Purchase Agreement Act Today Virginia Senator Allen Endorses Rental Purchase Agreement Act; Hearing Scheduled For 22nd Washington Senator Patty Murray Cosponsors Rental Purchase Agreement Act; Senate Co-sponsor Count At 50% Shuster and Lampson Cosponsor Rental Purchase Agreement Act Senate Powerhouse Tom Daschle Cosponsors Rental Purchase Agreement Act; Senate Co-sponsor Count Nears 50% Six New Cosponsors For Rental Purchase Agreement Act North Dakota Democrat Senator Byron Dorgan Cosponsors S884; Senate Co-sponsor Count at 23 Missouri Republican Todd Akin Supports Rental Purchase Agreement Act Southern Democrats Co-sponsor Rental Purchase Agreement Act Rent to Own Industry Supporter Doug Bereuter Resigning House Seat For Private Sector Missouri Republican Senator Christopher Bond Cosponsors S884 Senate Co-sponsor Count at 22 Consumer Rental Purchase Agreement Act Co-Sponsor Rep. Tiberi Introduces "No Down Payment Act" Rent to Own Online Introduces New State Statute Application 20% of Lawmakers Co-Sponsor Consumer Rental Purchase Agreement Act Illinois Republican Becomes 82nd Representative to Co-sponsor HR996 11 Term Texas Democrat Becomes 81st Representative to Co-sponsor HR996 Oregon Republican Senator Gordon Smith Cosponsors S884 Senate Co-sponsor Count at 21 Six Term Democrat Tim Holden (PA) Becomes 80th Co-Sponsor of HR996 Senators Roberts and Craig Cosponsor S884 Industry Hits Goal of 20 Co-sponsors by Mid September Kansas Democrat Becomes 79th Co-Sponsor of HR996 Bayh and Baucus Bring Senate Cosponsor Count to 18 Oregon Republican Switches Sides and Becomes 78th Co-Sponsor of HR996 ; Total at 78 Iowa Republican Steve King Co-Sponsors HR996 ; Total at 77 North Dakota Democrat Kent Conrad Brings Senate Cosponsor Count to 16 Kansas Republican Sam Brownback Brings Senate Cosponsor Count to 15 2 More House Democrats Cosponsors HR996; Total at 76 11 New House Cosponsors HR996; Total at 74 Trent Lott (R-MS), Chuck Hagel (R-NE) Bring Senate Cosponsor Count to 14 update HR996 Sponsorship... What's The Real Number? HR996; Movement In House Unlikely Till Senate Gets Off Dime HR 996: Consumer Rental Purchase Agreement Act Thomas Carper (D-DE) Becomes 12th Senate Cosponsor of RTO Legislation Michael Crapo (R-ID) Becomes 11th Senate Cosponsor of RTO Legislation Avalanche of Co-Sponsors for Rent to Own Legislation During APRO Legislative Conference 32 More Stories on Rental Purchase Agreement Act The bill was first introduced by Representative Walter B. Jones of NC in May, 2001. Click here for Rep. Jones Home Page

HR1701, the proposed "Consumer Rental Purchase Agreement Act" was passed by the committee on financial services by a vote of 29-9. The bill now moves on to the full house for consideration. We have pulled out a few major points of the bill for your review. After reviewing these points, please take a moment to complete the poll (at right) or send a comment using the form at the bottom of this page. Your comments will be forwarded to the appropriate people.

You will notice that most changes are minor. In fact, most of you will be following the proposed legislation already. As we see it, the only major impacts will be felt in the few states that either have no current legislation, or require APR or other "credit like" disclosures.

Rent a Center, Rentway, Aarons, and others operating across state lines will gain the biggest benefit should HR1701 become law. A rent to own company operating in multiple jurisdictions, must essentially have a different business model for each state. HR1701 would bring consistency, and therefore cost savings, to the big boys.

Take a poll Results are shown after you vote

The bill also centralizes enforcement of Rent to Own statutes under the FTC. According to the statute, any state AG alleging a violation of HR1701, must first notify the FTC. The FTC has the option to remove the case from the states jurisdiction, and place it in the appropriate federal court. (so much for campaign finance through settlement money)

We have tried to focus on things that will require some change in the way a typical Rent to Own company will write agreements, collect payments, etc. RTO Online has the entire Act in html for your review here.

Key points of interest in HR1701

• Most agreements have disclosure information towards the bottom of the agreement. HR1701 would simply move most disclosure info to the beginning of the agreement.
   

• Add the following statement to all agreements:

‘OTHER IMPORTANT TERMS: See your rental-purchase agreement for additional important information on early termination procedures, purchase option rights, responsibilities for loss, damage or destruction of the property, warranties, maintenance responsibilities, and other charges or penalties you may incur.’

• Damage waiver and other insurance disclosures
  A clear and conspicuous statement that the purchase of leased property insurance or liability waiver coverage is not required as a condition for entering into the rental-purchase agreement. A customer must sign an affirmative written request for such coverage after receiving the disclosures.
   
• Customers must be allowed to re-instate the agreement by paying all past due rent and the rent for the next period within 7 days on a monthly agreement, and 3 days on weekly, bi-weekly, and semi-monthly accounts.
   
• If a customer voluntarily returns the merchandise within the 're-instatement period' described above, you must allow the customer to re-instate the agreement by paying past due rent and the next rental payment for a period of 60 days.
  
  If a customer has paid more than 50% of rental payments, and voluntarily returns the merchandise within the 're-instatement period', you must allow the customer to re-instate the agreement by paying past due rent and the next rental payment for a period of 120 days.
  
  If a customer takes advantage of the extended re-instatement period, you must provide the same or similar merchandise, and the customer must receive credit for all payments previously made.

  The 7 and 3 day re-instatement periods do not preclude you from trying to re-possess your merchandise during the period.
   

• After a customer acquires ownership, you must deliver, or mail to the consumer’s last known address, documents necessary to acknowledge full ownership by the consumer of the property acquired.
   
• Price Tags
  The following will be require for all items displayed in the store

• (1) A brief description of the property.
• (2) Whether the property is new or used.
• (3) The cash price of the property.
• (4) The amount of each rental payment.
• (5) The total number of rental payments necessary to acquire ownership of the property.
• (6) The rental-purchase cost.

• Advertising
  If an advertisement refers to a payment, it must also include the following

• (1) The transaction advertised is a rental-purchase agreement.
• (2) The amount, timing, and total number of rental payments necessary to acquire ownership under the rental-purchase agreement.
• (3) The amount of the rental-purchase cost.
• (4) To acquire ownership of the property the consumer must pay the rental-purchase cost plus applicable taxes.
• (5) Whether the stated payment amount and advertised rental-purchase cost is for new or used property.

• I addition to requirements for disclosure in advertising, the bill would prohibit advertising any item that is not customarily offered at the advertised payment.

PROHIBITION.
An advertisement for a rental purchase agreement shall not state or imply that a specific item, or set of items, is available at specific amounts or terms unless the merchant usually and customarily offers, or will offer, the item or set of items at the stated amounts or terms.

• Liability
  A consumer may bring an action against a dealer for violation of the bill for a period of 1 year from the last payment made on the agreement.
   
• Any State Attorney General bringing an action against a Rent to Own for violation of the bill, must first notify the FTC (Federal Trade Commission). The FTC can, at its discretion, move the proceeding to a federal court.
   
• HR1701 supercedes any state law that is not 'consistent' with the bill. If an inconsistency is found to exist, the dealers in that state are not bound to follow the state law. A state law that provides 'greater protection' for consumers, will not be considered inconsistent.
   
• HR1701 will supersede any State law that

• (1) regulates a rental-purchase agreement as a security interest, credit sale, retail installment sale, conditional sale or any other form of consumer credit, or that imputes to a rental-purchase agreement the creation of a debt or extension of credit, or
• (2) requires the disclosure of a percentage rate calculation, including a time-price differential, an annual percentage rate, or an effective annual percentage rate.

end

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