Can You Go to Jail for Not Paying Rent-A-Center? Legal Consequences Explained

by | Apr 15, 2024 | Advices | 0 comments

Rent-to-own companies like Rent-A-Center offer customers the ability to lease household goods with the option to eventually own them. However, when customers fall behind on payments, some companies have resorted to threatening arrest or criminal prosecution. This has led to questions about the legal consequences of not paying Rent-A-Center and whether you can actually go to jail for missed payments.

Can You Be Arrested for Not Paying Rent-A-Center?

Rent-A-Center’s History of Threatening Customers with Arrest

In the past, Rent-A-Center has faced scrutiny for its debt collection practices. According to Universal Hub, the company received an $8.75 million fine for threatening to have some customers arrested when they got behind on payments and harassing others. This aggressive approach to collecting debts raised concerns about the potential for customers to face criminal charges for financial struggles.

However, the legal landscape in Texas has recently shifted to provide more protections for rent-to-own customers. In September, a new law went into effect that aims to prevent the criminalization of payment difficulties while still allowing companies to pursue intentional theft cases.

Texas Law Changes Protecting Rent-to-Own Customers

The new Texas law, signed by Republican Gov. Greg Abbott, seeks to balance the interests of both rent-to-own companies and their customers. It limits criminal prosecution for missed payments on household goods while still allowing criminal charges in cases of ill-intentioned customers who deliberately try to steal merchandise.

Jason Milam, president of the McLennan County Criminal Defense Lawyers Association, commented on the law, stating that it closes a loophole that previously allowed for the unconstitutional prosecution of people simply for being unable to pay. The law received input from various stakeholders, including criminal prosecutors, consumer advocates, and rent-to-own companies themselves.

Legal Consequences of Not Paying Rent-A-Center

When Criminal Charges Can Still Be Pressed

While the new Texas law aims to protect rent-to-own customers from facing criminal charges solely for payment struggles, there are still situations where criminal prosecution can occur. If a customer intentionally tries to steal merchandise or engages in fraudulent behavior, rent-to-own companies can still press charges.

The law differentiates between customers who are genuinely struggling to make payments and those who have ill intentions. This distinction is important to prevent abuse of the system while still holding individuals accountable for intentional theft.

Using the Civil Justice System for Debt Collection

Even with the limitations on criminal prosecution, rent-to-own companies like Rent-A-Center still have avenues for collecting unpaid debts. The civil justice system is designed for this purpose, allowing companies to pursue legal action against customers who fail to meet their payment obligations.

Through civil court proceedings, Rent-A-Center can seek judgments against customers for the amount owed. This can result in wage garnishment, property liens, or other legal remedies to recover the debt. However, these actions do not involve criminal charges or the threat of jail time.

How the New Texas Law Protects Rent-to-Own Customers

Balancing Protections for Companies and Customers

The new Texas law aims to strike a balance between protecting the interests of rent-to-own companies and ensuring that customers are not unfairly criminalized for financial hardships. By limiting the circumstances under which criminal charges can be pressed, the law helps prevent situations where individuals face jail time solely for being unable to make payments.

At the same time, the law includes provisions to protect companies from intentional theft. It allows for criminal prosecution in cases where customers deliberately try to steal merchandise or engage in fraudulent behavior. This helps ensure that rent-to-own businesses can still take action against those who abuse the system.

Differentiating Intentional Theft from Payment Struggles

One of the key aspects of the new Texas law is its focus on differentiating between intentional theft and genuine payment struggles. By drawing this distinction, the law seeks to prevent the criminalization of poverty while still holding individuals accountable for deliberate criminal acts.

Ann Baddour, director of the Fair Financial Services Project at Texas Appleseed, emphasized the importance of this differentiation. She noted that the law adds “guardrails” to limit what can be criminally prosecuted under the state’s theft-of-service statute. This helps ensure that rent-to-own customers who are sincerely trying to make payments are not unfairly targeted with criminal charges.

In conclusion, while not paying Rent-A-Center can result in legal consequences, the new Texas law aims to protect customers from facing jail time solely for payment struggles. Criminal charges can still be pressed in cases of intentional theft, but the law seeks to prevent the criminalization of poverty. Rent-to-own companies can still use the civil justice system to pursue unpaid debts, but customers should not fear arrest or imprisonment simply for falling behind on payments.

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