PSA for Rent-to-own Borrowers in PA
A Pennsylvania man was recently jailed and charged with a felony when he failed to make a payment on his rented furniture from Aaron's. According to The Appeal, "his crime was falling behind on payments for his bed and washing machine." While there is no debtors prison, the case against Nicolas Harmony centers on a Pennsylvania law regarding the theft of leased property which states "that a person who obtains personal property under an agreement for the lease or rental of the property is guilty of theft if he intentionally deals with the property as his own."
Joshua Vaughn, a crime reporter for The Sentinel, explains, "the statute is used by rent-to-own companies to turn the criminal justice system into their debt collector." When Harmony missed his September payment, Aaron's filed a criminal complaint instead of referring the matter to a collections agency.
Read the full story here.
While we understand many are drawn in by the low barrier to entry offered by predatory lenders and rent-to-own businesses, we strongly encourage families to avoid using them at all costs. The system of making payments on rented furniture, electronics, or appliances, is
designed to benefit the business, at a burdensome expense to the consumer. (Let's not forget Aaron's settled a lawsuit for $28 million alleging they spied on customers who rented computers by monitoring keystrokes and viewing them through webcams.) Making use of predatory lenders is not permitted in the North Star program. To discourage our participants from using these businesses, we offer donated gently used home furnishings.
The justice system in Pennsylvania has done some work to protect consumers from predatory lenders, notably making payday loans illegal in the state. While the case against Harmony moves forward, it's an important reminder of the dangers of signing such a contract, especially if there are concerns regarding affording monthly payments.