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March 31, 2006
Victories against Rent to own in NJ and WI
[8 Jan 07-Corrected bad urls] Yesterday, Wisconsin Governor Jim Doyle vetoed legislation that would have exempted the predatory rent-to-own industry from that state's tough consumer laws (Wisconsin State Journal news story). From Governor Doyle's veto statement:) "The Wisconsin Consumer Act has for decades provided strong protections for Wisconsin consumers, and is considered one of the best consumer protection laws in the country. As Attorney General, I successfully fought in the courts to assure that the Wisconsin Consumer Act applied to rent-to-own transactions. And while SB 268 includes some significant improvements over past legislative efforts, I am not satisfied that it provides adequate protection to consumers." The predatory rent-to-own industry appears upset. From its website: The misinformation and outright misrepresentations that have been circulated by the groups that opposed the legislation are, if left unaddressed, cancerous to the operation of a fair legislative process. Christopher Korst, Rent-A-Center General Counsel In another big victory, earlier this month the New Jersey Supreme Court reversed a lower court, holding that the rent-to-own industry is subject to the state's 30% APR criminal usury ceiling and its own tough state consumer laws (Newark Star Ledger story). According to the Consumers League of New Jersey (Thanks also for the graphic, CLNJ): The New Jersey Supreme Court on March 15, 2006 ruled that the rent to own contract of Rent-a-Center, as used in New Jersey in the case of Hilda Perez, was a Retail Installment Sales contract, and ruled that the maximum legal interest rate was the 30% limit of New Jersey's Criminal Usury Law. Therefore the 80% interest charged to Hilda Perez was illegal. . The New Jersey decision is here.
The predatory rent-to-own boys want the right to promise consumers the American dream of ownership of televisions, refrigerators and even car wheelsets, but don't want to disclose the cost of financing their products. They claim renting-to-own isn't buying a product over time. That's wrong. Even though 45 states or so have rolled over and agreed to allow them to deceive consumers, we're pleased that Wisconsin and New Jersey and a few others are still protecting their residents better. Here's our previous blog and a link to our archive on rent to own. We're watching their efforts to move a federal bill, S 603 (Landrieu-D-LA) or HR 996 (Jones-R-NC) to preempt the right of states to protect their residents better.
Posted by Ed Mierzwinski at March 31, 2006 10:54 AM
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