Watchdog poised to crack down on rent-to-own shops

[citizenB]

I am unable to find any other articles on this and sadly this site doesn't allow you to read the full article

 

 

Linda Woodall, director of consumer lending at the Financial Conduct Authority, said that initial correspondence with BrightHouse, PerfectHome and Buy As You View had revealed “concerning statistics”. Half of all customers buying household goods on rent-to-own contracts failed to pay in full, she said, with a further 22% either surrendering their products or having them repossessed.

 

Rent-to-own companies offer high-interest credit on household items such as fridges and TVs. The industry argues that it gives poor families a way to finance essential purchases with weekly repayments of less than £10, but critics say the annual interest rates — between 64.7% and 79.9% in BrightHouse’s case — make them “legal loan sharks”.

 

 

 

http://www.thesundaytimes.co.uk/sto/business/Finance/article1516387.ece

[citizenB]

I caught something on the wireless in the car and the reporter was pointing out the "compulsory insurances" that are now built into Brighthouse contracts.

[Michael Browne]

 

The City watchdog has been urged by MPs to take action against controversial rent-to-own retailers which charge sky-high prices for household goods.

 

 

 

Stores such as BrightHouse, PerfectHome and Buy as you View have been accused by the All-Party Parliamentary Group on Debt and Personal Finance of forcing people to take out expensive warranties and insurance when buying fridges or sofas through high street stores.

 

MPs have also accused the stores of possibly misselling insurance and services people don’t need.

 

They are today demanding the introduction of "health warnings" to ensure customers are aware of the total cost of agreements and the risks of repossession.

 

Vulnerable customers should also be protected against losing essential items that they have mostly paid for, the MPs said.

 

Their research uncovered the shocking fact that more than a fifth of customers in arrears have had goods taken back by the firms.

 

 

http://www.independent.co.uk/money/spend-save/mps-demand-crackdown-on-renttoown-firms-overcharging-the-poor-10034611.html

 

 

 

 

http://www.standard.co.uk/business/business-news/mps-demand-end-to-ripoff-tactics-of-renttoown-shops-10035314.html

Edited February 10, 2015 by citizenB

[SabreSheep]

 

Hundreds of thousands of customers who buy household goods through rent-to-own schemes are being "ripped off", a group of MPs has concluded.

 

It said some of the poorest people in the UK are being charged interest rates of up to 94% a year to buy TVs or washing machines.

 

The All Party Parliamentary Group on Debt and Personal Finance now wants the regulator to take action.

 

BrightHouse, the largest company, said it was disappointed by the report.

 

Under the rent-to-own model, consumers take out an agreement to buy a product, and then pay weekly instalments until they own it - similar to a hire purchase agreement.

 

But usually customers have to take out compulsory insurance and warrantees, which can double the eventual cost.

 

 

 

http://www.bbc.co.uk/news/business-31356150

Edited February 10, 2015 by citizenB

[citizenB]

Thanks Guys, much appreciated.

[citizenB]

Michael Brown reported that this might happen in September of last year.

 

 

http://www.consumeractiongroup.co.uk/forum/showthread.php?432580-Brighthouse-to-face-parliamentary-scrutiny

[beth0o0]

Why should you be forced to take there 5 star service when you have your own home insurance. would this then be classed as miss selling? hope so as its made items even higher and on longer terms. I have a laptop which thank fully finishes this year. Anyway the frame around the screen has cracked and is coming apart so I contacted them explaining this and they told me to bring it in and they'll send it for repair. I asked them for a loan one whilst its being repaired and they said they can't do that as the loan one is out and they only have one loan laptop in each store.

 

I've just looked at there site and it states 'loan products when required" I still haven't handed it in as its the only thing I have for my online course so I can't be without a computer.

[Jason BrightHouse Web Rela]

Dear Beth0o0

 

We've simplified our proposition to offer every customer our “5 Star Service” package. It gives them peace of mind from expensive repair bills when the screen on their tablet cracks or the washing machine leaks. To see further details on what our 5 Star Service covers, please visit our website at: http://www.brighthouse.co.uk/about-us/5-star-service/

 

I’m sorry to hear that the frame around your laptop screen has cracked. I’d like to try and help you, please can you email me at [email protected] and confirm your account details (Account holders name, Address and store). Please also don’t forget to include you CAG reference number in the email subject line and we’ll get back to you as soon as we can. Alternatively if you would rather speak to someone, then please contact our Customer Relations Team on 0800 526 069.

 

Many Thanks,

 

Jason

Web Relations Team

[dx100uk]

but no customer NEEDS to take out any extra insurance on HP goods!!

there are no laws whatsoever that state HP goods must be insured.

 

 

the sale of goods act protects all purchased items for upto 6yrs for FREE.

 

from day one it was always a part of such rent to own companies business plan to make profits out of these compulsory insurances

else the companies would never have gone into business in the first place offering such goods

 

 

to now 'hide' them, and make them compulsory is daylight robbery

 

 

dx