Updated: May 17, 2025

If you need new furniture, electronics, or appliances but don’t have the cash to pay upfront, rent-to-own stores might seem like an easy solution. While these agreements can offer short-term relief, they often come with long-term costs that aren’t always clear at the start.

What Is Rent-to-Own?

Rent-to-own (also known as lease-to-own) is a type of purchase agreement where you rent an item with the option to buy it after making a set number of payments. It’s common with things like sofas, TVs, refrigerators, or even mattresses. You make weekly or monthly payments, and if you continue paying for the full term, you own the item at the end.

These agreements are often advertised as “no credit check” or “same-day delivery,” making them attractive to people with low income or bad credit. Because the approval process is easier than traditional financing, rent-to-own stores are common in low-income neighborhoods and appeal to people who feel like they have no other options.

How It Works

When you choose a rent-to-own item, the store sets a payment schedule—usually weekly, biweekly, or monthly. You agree to pay that amount for a fixed number of periods, which could range from a few months to a few years. If you make every payment, the item becomes yours.

You may also have the option to purchase the item early, either through a discounted buyout option or by paying the remaining balance all at once. Some stores offer a 90-day same-as-cash option, which means if you pay off the total price within the first 90 days, you avoid interest or extra fees. But if you go beyond that window, the total cost can increase dramatically.

If you stop making payments, the store can take back the item. In most cases, there’s no refund for the money you already paid.

The Pros of Rent-to-Own

The biggest advantage of rent-to-own is accessibility. These stores don’t require a high credit score or a large down payment. If you need a couch, refrigerator, or laptop right away, you can often walk out the same day with the item.

Rent-to-own can also be a short-term solution if you truly can’t afford an upfront payment but need the item urgently—like replacing a broken appliance. Some agreements include maintenance or replacement if the product breaks while you’re still making payments, which can be helpful for people who don’t have a lot of savings.

The payments are predictable, and for some, it’s easier to budget a weekly or monthly amount than to save a large lump sum. Rent-to-own stores may also deliver the items and handle setup, which can add convenience.

The Cons of Rent-to-Own

While rent-to-own may sound appealing, the long-term cost is usually much higher than buying the item outright. A TV that sells for $300 in a regular store might cost over $1,000 by the time you finish all the rent-to-own payments.

The price isn’t always clear at the beginning. Many agreements focus on the payment amount rather than the total cost, so it’s easy to underestimate how much you’ll end up paying over time. Always ask for the total purchase cost, not just the weekly or monthly rate.

You don’t actually own the item until the final payment is made. That means if you miss payments or need to return the item, you lose the item and the money you’ve already spent.

There’s also the risk of hidden fees. Some contracts include additional charges for delivery, repairs, or late payments. Others may raise the payment amount if you change the payment schedule.

Finally, rent-to-own doesn’t usually help build your credit. Even though you’re making regular payments, most stores don’t report them to credit bureaus. So if you’re hoping to improve your credit score by paying off your item, this won’t help in most cases.

Rent-to-Own vs. Other Payment Options

Before committing to a rent-to-own contract, it’s important to compare your alternatives. In many cases, a different option can save you money.

Layaway is one alternative where you make small payments toward an item, but you don’t take it home until it’s fully paid off. While you have to wait, there’s usually no interest, making it a more affordable choice in the long run.

Buy Now, Pay Later (BNPL) services like Afterpay or Klarna let you split your purchase into smaller payments, often without interest if paid on time. These are better suited for smaller items and can be found at many online and retail stores.

If you have a checking or savings account, consider saving a small amount each week until you have enough to buy the item outright. Even $10 or $20 a week can add up quickly and help you avoid the high cost of rent-to-own.

Another option is using a low-interest or 0% APR credit card if you qualify. These let you buy an item and pay it off over time, and if managed well, can help build your credit score.

Rent-to-Own vs. Other Options

Questions to Ask Before Signing

If you’re still considering rent-to-own, be sure to ask the right questions before signing anything. What is the total cost of the item if all payments are made? Are there any fees for late payments, delivery, or early payoff? Can you return the item without penalty if you change your mind?

Also ask whether your payments will be reported to credit bureaus. If not, and you’re hoping to build your credit, this may not be the right tool.

Take time to read the fine print. Don’t feel rushed to sign. Reputable companies will give you time to review the contract and answer your questions.

Final Thoughts

Rent-to-own agreements can be helpful in certain situations, especially for people with limited credit or cash on hand. But they come with significant downsides, including high costs and no ownership until the very end. Before signing a contract, explore other payment options and consider whether the item is something you truly need right now. In many cases, waiting, saving, or choosing a different path can lead to better financial outcomes and less stress.