Reviewing Agreements

Agreements Sub-Categories

• Rental Applications
• Reviewing the Agreement with the customer

Reviewing the Rental Agreement with the Customer

The objective of this evolution will be to understand the importance of complete disclosure of all agreement properties to the customer.

Let's face it...we will never have a warm and fuzzy relationship with so called "consumer advocates". Most advocate organizations have 2 very annoying similarities.

• They have a low opinion of Rent to Own Customers.

• They believe anyone who earns less money than they do, is incapable of spending it wisely.

The industry as a whole goes above and beyond the disclosures required by law. We can avoid problems by insuring our customers have absolute clarity on the terms of the rental agreement.
NOTE: You should review the statutes regulating Rental Purchase in your state to insure proper disclosure.  RTO Online maintains links to most states Rental Purchase statutes HERE

The Agreement
If you use a pre-printed agreement, insure all print is properly aligned and plainly visible. Most RTO software providers will customize your printer output to match your agreement. It does little good to have all disclosure information printed if it can't be seen.

Laser Printers configured to print the entire agreement including terms and disclosures are the safest bet. Laser Printers are more expensive initially but the ongoing cost is similar to dot-matrix.

NOTE: Don't rely on the supplier of your pre-printed forms to insure compliance with your state regulations. You are responsible for insuring compliance, regardless of the claims of the publisher.

Review with the customer
Your relationship with this customer is in a critical stage. 

"An agreement that starts well will end well"

It is in your best interest (on several levels) to make absolutely certain your customer understands his/her obligations as stated in the agreement.

Since agreements vary widely, we will discuss  the most common, and most important, specifics to review with the customer. This list may be incomplete...check your regulations.

It takes two to tango
Your obligations to the customer are as important, possibly more so, than the customers obligation to you. Cover in detail what your responsibilities are.

Your Responsibilities to the Customer

• No Long Term Obligation
  "You are under no obligation to continue renting the merchandise. You can return the merchandise in good condition at ANY TIME. This is a Rental Agreement. It remains in effect only as long as you want it to...you are in complete control."

• Cash Price
  "The cash price for this merchandise is X. 50% of all rent you pay will go towards ownership of the merchandise. You can purchase the merchandise at any time during the agreement by paying the remainder of the purchase price. An easy way to calculate this is...You can buy the merchandise at any time during the agreement by paying 50% of the remaining renewal payments in one lump sum. 

• Payment
  Your weekly Renewal payment is X dollars. The sales tax is X dollars. For a total payment of X dollars. 

• Fees
  You have chosen our optional Damage Waiver. By paying this weekly fee, the waiver relieves you of the obligation to renew your agreement should the merchandise be destroyed by X,Y,Z. Damage waiver does not cover normal wear and tear. The weekly cost of Damage Waiver is X dollars. Do you understand?...Do you have any questions about Damage waiver or any other fee?" Have the customer initial next to the Damage Waiver amount.
  NOTE: You should have already discussed damage waiver with the customer during the application process. Damage waiver must be optional in most states. If you have waited until now...it's too late

• Total Cost
  "If you choose to renew the agreement for X weeks, you will pay X dollars including tax and fees.
  Do you understand?...Do you have any questions about your ownership options or payments? (have customer initial next to the Total Cost line on the agreement...there's no such thing as too much documentation)"
  NOTE: You Must Be Consistent. The review process must be the same for ALL customers. Have a checklist printed and follow it to the letter. 

• Free delivery
  "We do not charge for delivery"
  "We guarantee the merchandise will be delivered to you in good working order. We will not leave your home until you are completely satisfied with the merchandise. If, FOR ANY REASON, you are dissatisfied with the merchandise, we will gladly exchange it today. The delivery is not complete until you sign the delivery ticket."

• Free Service
  "If at ANY TIME during the agreement, the merchandise needs repair. We guarantee to either repair, or replace it with similar merchandise, at NO ADDITIONAL COST to you. Except for normal wear and tear, everything is covered 100% parts and labor. And we promise to perform any needed service the same day you call. If your items need to be repaired, we will bring you a replacement to use until yours is fixed.  Please don't hesitate to call if you have any problems."

The Customers responsibility

• "You have chosen to rent this merchandise by the week. If you wish to continue renting, you must RENEW your agreement every week. The way you RENEW the agreement is by making your Renewal payment. Your RENEWAL payment will be due every Saturday. If you wish to continue the agreement, you must make a weekly renewal payment by 6pm Saturday. If the renewal payment is not made by 6pm on Saturday, the agreement is terminated and the merchandise must be returned. If you choose not to continue the agreement, we will gladly pick up our merchandise, and you can rent again anytime."  If you RENEW your agreement for X weeks, the merchandise becomes your property. Until then, it is our property."

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