The Texas Rent-to-own Industry's Hidden Hammer Is Its ‘debt Collection by Police' Power

Note: The Texas Tribune and NerdWallet, a personal finance website that helps consumers make smart decisions about their financial lives, partnered to examine rent-to-own companies, their debt collection practices and the impact that these businesses can have on consumers' financial lives. This story is republished with permission.When Melinda Sandlin walked out of Discount Furniture in Austin in late 2014, she was sure the store had put her on a payment plan to buy a new bedroom suite worth $2,750.A year later, after realizing she had sent in more than $3,000 for her seven-piece set, she figured she was done. So Sandlin told the store clerk she wasn't going to be making any more monthly payments."I already bought it out," she recalls telling them. "And they're like, 'Oh no, read your contract. It's a rental contract. It's not a purchase contract.' "That's when her nightmare began.Sandlin, 43, had signed a "rent-to-own" contract through a company called Acceptance Now — a division of Plano-based Rent-A-Center, one of the largest rent-to-own companies in the United States. Sandlin had no clue the company had embedded itself in regular furniture stores around the country.Not only would Sandlin have to pay another $5,000 in order to keep her bedroom set — on top of the more than $3,000 she'd already paid — she found out the company has a legal hammer unique to the rental industry. And taped phone calls indicate the company threatened to use it on her."We have to get a payment," the store's rent-to-own manager, Minnie Tovar, told Sandlin during a tense phone call that Sandlin recorded. "We have to resolve this or we do file theft charges."  Continue reading...