Millions of Americans who are unable to stump up the thousands of dollars needed to furnish their homes turn to companies like Rent-A-Center, which markets its services as a way for people with bad credit to "live large without making large payments."
The deal is pretty simple: instead of buying a couch with cash, or using store financing — typically only offered to people with good credit — rent-to-own companies let you pick a payment plan for furniture which you can choose to return at any time, much like a rental car.
Yet those contracts come with a serious and little-known risk. While falling behind on an installment plan can lead to late fees, debt collectors and a black mark on your credit record, missed rental payments can escalate to police involvement. If your state is one of the many with criminal rental theft laws on its books, possessing a rental item that you're not paying the bills for can be considered theft.
Instead of a call from a debt collector, rent-to-own customers can end up in handcuffs, as Taylor Flaim, a 26-year-old roofing contractor in Sarasota, Florida, recently learned.
Flaim, a former medical student who now works for his father's roofing company, had never had run-ins with the law before his Rent-A-Center ordeal. He and his former girlfriend agreed to rent a few pieces of furniture and a cell phone from the company, but in August 2015 they broke up and moved out of their home, he said.
The company came by to pick up the items they had rented together, said Flaim. He changed his number to keep his ex from contacting him and moved on with his life.
Flaim was shocked to learn last June that he had a felony warrant out for his arrest. Rent-A-Center accused him of theft for failing to return the cell phone, which he says was in the possession of his ex-girlfriend.
He was charged under a Florida state statute, which considers theft of rented property valued at more than $300 a third-degree felony. Florida is one of at least 38 states that criminalize consumers for not returning rental property. In some states it's treated as a misdemeanor, but in most states the crime can be escalated to a felony depending on the claimed cost of the rented goods.
"It was like a scam," said Flaim, who said he'd never heard from the company before being charged with a felony. "Instead of just going and hitting my credit like other creditors do, they filed a felony for failure to release property like I stole it or something."
He called the company and was told by the district manager that if he paid $200, the warrant would be dropped. He paid the amount in July to finally settle the charge.
He thought the ordeal had been resolved. But this January, when he was pulled over for speeding, the officer ran a check and found that he still had a warrant out for his arrest. He spent the night in a cell at a police precinct and bailed himself out for $1,500, according to court records reviewed by BuzzFeed News.
Rent-A-Center accused Flaim of stealing $3,593.79 in property from the company, according to his attorney Peter Lombardo, who has prosecuted and defended rental theft cases over the course of his 29 year career.
"They got all the items back except the cell phone," Lombardo told BuzzFeed News. "He never really had the phone. To me, this is typical abuse of the system."
Lombardo said rental theft laws allow companies escalate what would typically by a civil dispute into the criminal arena, using the state to act as a collections agency. The company said it would drop charges if Flaim paid an additional $784 in restitution. He paid and the case was dismissed this week.
Rent-A-Center told BuzzFeed News that it understands "that life happens and some of our customers can’t make payments." But it defended its use of state statutes to go after people who fail to return rented property.
"If someone decides that he or she wants to keep the merchandise without paying for it, then we will take steps to follow the law and recoup what was stolen," it said.
About 4.8 million US households use rent-to-own services, according to the Association of Progressive Rental Organizations, an industry group, which estimates the total market is worth $8.5 billion. Most rent-to-own customers make less than $36,000 a year, according to the association.
Richard May, its executive director, told BuzzFeed News it is very rare that companies resort to criminal measures to retrieve debts. About 6% of merchandise was considered stolen in 2016, according to an upcoming industry survey of 36 rent-to-own stores reviewed by BuzzFeed News.
"If they fail to make payments and give the product back, there is no theft," said May. "If they quit making payments and don't give the product back, that tips over to saying you're stealing our stuff."
Flaim argues the laws are not aimed at retrieving stolen property, but to use the justice system as a way to ensure the company makes a profit.
"They take advantage of people who can’t afford to buy things, and they jack their prices up and they make money off of pretty much poor people," said Flaim. "And if you don't pay them then God forbid you're going to have a felony."