What Happens If You Don’T Pay Rent-A-Center?
Rent-A-Center is a popular rent-to-own company that allows customers to pay for furniture, appliances, electronics and other household items through weekly or monthly installments.
But what happens if you fall behind on your payments or stop paying altogether?
If you’re short on time, here’s a quick answer: If you don’t pay Rent-A-Center as agreed, they can repossess the items and send the account to collections, which will damage your credit score.
In this comprehensive guide, we’ll explore the repossession process, collection efforts, lawsuit risks, credit impacts and tips for avoiding issues when renting from Rent-A-Center and similar rent-to-own companies.
Rent-A-Center’s Repossession Process
When you don’t pay your rent on time at Rent-A-Center, there is a specific process that they follow to repossess the items you have rented. It is important to understand this process so that you are aware of the potential consequences of not paying your rent.
Initial Late Notices
If you miss your rent payment, Rent-A-Center will typically send you a late notice. This notice serves as a reminder to pay your rent and can include any late fees that you may owe.
It is important to take these notices seriously and make arrangements to pay your rent as soon as possible to avoid further action.
Repossession Warning
If you fail to make your rent payment after receiving the initial late notices, Rent-A-Center may issue a repossession warning. This warning is a more formal notice that informs you of their intent to repossess the rented items if you do not pay your outstanding balance.
It is important to address this warning promptly to avoid losing your rented items.
Item Pickup
If you still do not pay your rent or make arrangements with Rent-A-Center after receiving the repossession warning, they will proceed with the repossession process. Rent-A-Center has the right to enter your premises to retrieve the rented items.
They will typically send a representative to pick up the items, and they may request assistance from local law enforcement if necessary.
Fees and Charges
When Rent-A-Center repossesses your items, they may charge you additional fees and expenses. These fees can include repossession fees, storage fees, and any outstanding rent that is still owed.
It is important to note that these fees can quickly add up, making it even more challenging to regain possession of your items.
It is always best to communicate with Rent-A-Center if you are facing financial difficulties and unable to pay your rent. They may be willing to work out a payment plan or make other arrangements to help you avoid repossession.
Remember, it is in their best interest to work with you as a customer rather than go through the repossession process.
Debt Collection and Credit Reporting
When you don’t pay Rent-A-Center, you may find yourself dealing with debt collection agencies and potential damage to your credit score.
Let’s take a closer look at what happens in these situations and what you can expect.
Collection Calls and Letters
Once you miss a payment with Rent-A-Center, they will likely start contacting you to collect the overdue amount. This typically begins with phone calls and may escalate to sending collection letters.
These calls and letters can be persistent and may become quite bothersome. It’s important to stay calm and communicate with the collection agency to discuss your options.
Pro tip: If you’re receiving collection calls, it’s a good idea to keep a log of the dates and times of each call, as well as any conversations you have. This can be helpful if you need to dispute any inaccuracies or harassment in the future.
Credit Bureau Reporting
If you fail to pay Rent-A-Center and the debt remains outstanding, they may report your delinquency to credit bureaus. This can have a negative impact on your credit score and make it more difficult for you to obtain credit in the future.
Late payments and defaults can stay on your credit report for up to seven years, so it’s crucial to address any outstanding debts as soon as possible.
Did you know? According to a study conducted by the Federal Trade Commission, around 20% of consumers have an error on at least one of their credit reports. It’s important to regularly check your credit report for any inaccuracies that could be affecting your creditworthiness.
Damage to Credit Scores
When Rent-A-Center reports your delinquency to credit bureaus, it can result in a significant drop in your credit score. This can make it challenging to secure loans, credit cards, or even rent an apartment in the future.
Lenders and landlords rely on credit scores to assess your financial responsibility and ability to repay debts.
Fun fact: A lower credit score can also lead to higher interest rates on loans and credit cards. So, maintaining a good credit score is not only important for your financial well-being but can also save you money in the long run.
Lawsuits and Legal Action
When you don’t pay Rent-A-Center, you may face the possibility of lawsuits and legal action. Rent-A-Center has the right to take legal action to recover the money owed to them. Here are some potential consequences you may face:
Lawsuit Risks
Rent-A-Center can file a lawsuit against you for non-payment. If the court rules in their favor, a judgment will be issued against you. This judgment can negatively impact your credit score and make it harder for you to secure loans or credit in the future.
Additionally, if you ignore the lawsuit or fail to show up in court, the judge may issue a default judgment against you, resulting in even more severe consequences.
Wage Garnishment
If Rent-A-Center obtains a judgment against you, they may be able to garnish your wages. This means that a portion of your paycheck will be deducted to repay the debt.
The amount that can be garnished varies by state, but it can be a significant portion of your income. Wage garnishment can make it harder for you to cover your living expenses and may lead to financial hardship.
Bank Levies
Another potential consequence of not paying Rent-A-Center is a bank levy. If Rent-A-Center obtains a judgment against you, they may be able to freeze your bank account and seize the funds to repay the debt.
This can be a distressing situation, as it can leave you without access to your own money and make it difficult to meet your financial obligations.
It’s important to note that the specific consequences you may face for not paying Rent-A-Center can vary depending on your location and the terms of your rental agreement.
If you find yourself in this situation, it is advisable to consult with a legal professional who can provide guidance based on your specific circumstances.
Tips for Avoiding Issues with Rent-A-Center
Understand the Contract Terms
When renting from Rent-A-Center, it is crucial to thoroughly read and understand the contract terms before signing. This will help you avoid any surprises or misunderstandings in the future.
Take the time to go through each clause and ask questions if anything is unclear. Remember, knowledge is power!
Make Payments on Time
One of the most important things you can do to avoid issues with Rent-A-Center is to make your payments on time. Late or missed payments can lead to additional fees and penalties.
Set reminders for yourself or consider setting up automatic payments to ensure you never miss a due date. This way, you can maintain a good rapport with Rent-A-Center and avoid any unnecessary complications.
Communicate with Rent-A-Center
If you are facing financial difficulties or are unable to make a payment, it is crucial to communicate with Rent-A-Center. They may be able to work out a payment plan or offer alternative solutions.
Ignoring the issue will only make it worse, so it’s best to be proactive and reach out to them as soon as possible. Remember, Rent-A-Center wants to work with you and find a solution that works for both parties.
Consider Alternatives
If you find yourself in a situation where you can no longer afford the payments or no longer need the rented item, it’s important to explore alternative options. You can try negotiating with Rent-A-Center to return the item or consider transferring the rental to someone else.
Additionally, you can explore other rental or purchase options that better suit your financial situation. Remember, there are always alternatives available!
Conclusion
Rent-A-Center generally works with customers who fall behind on payments initially. But continued non-payment can lead to repossession and damage to your credit.
Your best bet is to understand your obligations, make payments on time, communicate with Rent-A-Center if issues arise, and consider alternatives like financing if the rent-to-own model no longer fits your budget.
With some planning and proactive steps, you can avoid the major consequences of not paying Rent-A-Center. But if you do end up in arrears, act quickly to work out a solution, get back on track and minimize the impacts.
