Rent to own Furniture

“Buy now with no credit check and no money down!” If this welcoming phrase sounds all too familiar, you might already be ensnared in the rent to own trap. Renting to own furniture sounds great, in theory. It allows you to get what you want, right now, and focuses your attention on the small, affordable weekly or monthly payments. However, when you break it down and look behind the curtain, the wizard of rent to own is not exactly welcoming.

1)         The interest rate

Rent to own furniture is usually accessorized with sky-high interest rates that border illegal usury. By the time you finish paying off your $1,200 living room set, you could have purchased two living room sets in cash, by saving money, in almost exactly the same period. Many rent to own stores charge as much as 67 percent APR, an outrageous amount no sane consumer would sign up for, unless he is seduced by the rent to own siren.

2)         The cost of instant gratification

Society prizes possessions and builds unconscious pressure on consumers to feed that instant gratification need right now. However, having things and overpaying for them is hardly smart consumerism. Smart buyers know that waiting and shopping around for the best deal puts money in their pocket, and not the pocket of a huge corporation. Rent to own furniture stores make millions each year off the backs of credit challenged consumers with an insatiable appetite for instantly gratifying their heart’s desire.

3)         No forward thinking

Renting to own does not help build your credit, even though bad or not enough credit is usually the catalyst that pushed you over the rent to own edge to begin with. Not only does renting to own do absolutely nothing for your financial future, it also keeps you slaving away for each dime, living paycheck to paycheck paying two or three times what the item you are renting to own is worth.

Even though renting to own furniture sounds grand for “right now” it does not mean it is the smartest financial move for your “little bit later”. Instead of signing a rent to own agreement, consider putting the same amount of the rental payment into savings for the duration of the contract and buying your heart’s desire in cash. You might just find yourself enjoying photos of your new sofa while you are sitting on a beach in Hawaii, because that extra money you did not waste on renting to own furniture, bought you a new living room set and a vacation on the side.