Announcing Rent To Own Contracts Cannot Be Utilised By Centrelink Clients

In the early 2000’s the Government allowed clients to utilise their Centrelink Benefits to rent essential household goods and appliances which was a great system. However, like all new ideas, there were flaws and over the years these have been ironed out and the system greatly improved.

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One of the major changes, involved the fact that in the early days of renting goods, there were no real controls and terms like “Rent to Own,” Rent to Buy,” Rent to Keep” and other such terms were commonly used and like the term “Ugg Boots” they became a commonly used generic term.

Renting household appliances and other items is a great way for people who are struggling financially to save the dollars they need to buy quality goods outright.
In years gone by people had a couple of options to obtain the furniture and household appliances they needed.

One of those options was to buy cheap and often very poor quality 2nd hand goods. The goods were often dirty, broken or needing repair but the client often had no other option. Most people have a sense of pride in their home and this pathway did nothing to give them that sense of pride.

The other option was to borrow money from Loan Sharks who acted outside the law. This was potentially worse if a client defaulted on their loan as there were no controls on how these Loan Sharks could go about reclaiming their goods or their money and it often included threats and/or violence.

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Richard Van der Velde from Easy Rent Options told us “the problem now is that the Government has legislated that such terms are illegal because they indicate that a client will own the goods at the end of the rental term and therefore using those terms is just a sneaky way of selling goods. This means that rental companies cannot say to a client things like “Yes, this is a Rent to Own contract and yes at the end of this you will own the goods.” That is completely wrong and totally illegal.”

The government rules state that a client renting goods does not have the right or obligation to purchase the items and the supplier cannot imply that they will own them at the end or this becomes a sales by installment agreement which is controlled by a whole other set of rules and it’s much tougher to allow clients to use this.

Richard went on further to say “What is legal is a conversation along the lines of, after establishing a client cannot pay up front, to offer a rental contract where traditionally at the end of the contract a client can make an offer to purchase the goods and traditionally the value of this is minimal, often $1.00 and sometimes the goods are gifted to the client.”

Anyone who has a specific question about a past, present, or future articles can contact Easy Rent Options either by phone 1300 781 788 or via their website:
Easy Rent Options is a business name of CTR Rentals Pty Ltd which holds ABN 44 010 413 215 – Australian Credit License 388677.

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