Hidden Cost of “Rent to Own” and “0% Financing” Purchases
The allure of a shiny car or a beautifully furnished home can make the low monthly payment options of “Rent to Own” and “0% Financing” appear to be an affordable, quick and easy purchase decision. Here is what you need to know about purchase plans:
- Rent to Own purchase plans allow consumers to “purchase” items and pay for them over long periods of time. The rental payment periods often extend past the useful life of the item. Buyers can find themselves burdened with rental payments on an item that has little value or may no longer perform the function for which it was purchased. “Rent to Own” payment plans are often offered on overpriced products. This repayment plan results in an expensive purchase for the buyer and a large profit for the financing company.
- 0% Financing purchase plans allow consumers to buy now and pay later without incurring interest charges. For the consumer, the purchase now and pay later option can be very tempting. Unfortunately, many individuals are not able to adhere to the rigorous repayment schedule set forth in the purchase contract. The business is playing the “odds” that the buyer will not always make the monthly payment on time or payoff the account before the 0% financing period expires. Suddenly the buyer’s great “deal” on the purchase became an expensive purchase.
These financing options combined with high pressure sales tactics may influence buyers to purchase items that they would not otherwise be able to afford. Unexpected life events can quickly change a buyers’ financial situation turning that low monthly payment into a crippling financial burden that can create painful budgeting and financial distress for years to come.
For more information read these articles….
0% Financing: https://www.nbcnews.com/business/consumer/when-buy-now-pay-later-ends-costing-you-more-much-n690256
Car Lease Information: https://www.consumer.ftc.gov/articles/0056-financing-or-leasing-car
In our Bankruptcy Law practice, we help families and individuals suffering emotional and financial distress due to purchase repayment programs. If you are financially struggling to make ends meet, the Attorneys at Mills Law can offer options for financial relief.
Call Mills Law today to schedule your FREE consumer debt consultation (919)934-7235.