WISPIRG Report Shines Light On High Costs Of Rent-To-Own Stores

A report from the Wisconsin Public Interest Research Group (WISPIRG) highlights the high cost of appliances and furniture sold by rent-to-own stores.

A state senator is using the information in an effort to strip a provision in the governor’s budget that would allow the stores to hide the price.

Sen. Glen Grothman (R-West Bend) says rent-to-own stores that charge high interest rates are taking advantage of people. The Republican wants fellow members of the budget-writing committee to remove budget provisions exempting such stores from the state’s Consumer Protection Act.

“These are not the type of people we should be helping. I still haven’t gotten over the fact that in the last budget we helped the payday loans stores. I think these are worse.”

The WISPIRG report shows most consumers do end up owning the appliance they’re renting, but at a steep cost. Average annual percentage rates at five rent-to-own stores in Rockford were above 200 percent. In a still-recovering economy, Barbara Sella of the Wisconsin Catholic Conference says consumers need as much information as they can get to spend responsibly.

“If we want Wisconsin to prosper – and I believe the governor when he says that he’s trying to lift Wisconsin economically – then we need to have laws that are fair and just. We need laws that encourage transparent and constructive business practices, not deceptive and destructive ones.”

The provision exempting rent-to-own stores from the Consumer Protection Act has failed to pass as a stand-alone bill in the past. However, critics, including Grothman, admit it may be difficult to get out of the state budget. Five of the nine members on the Joint Finance Committee would have to nix it. Grothman is the only Republican to come out publicly against it.