Leave Alone the Lease-to-Own

1 Minute Read

There is a new way to buy at Kmart.

On November 22, the retail chain is introducing a program that will allow customers to purchase products on a lease-to-own basis. The program is aimed at consumers who do not qualify for credit, thus giving them the option of buying a big-ticket item such as a television.


Local experts you can trust.

Find an ELP

The program is encountering some controversy because it charges an annual interest rate that is the equivalent of more than 100%. Over the course of the payoff period, a $300 item would end up costing about $415. Critics have expressed concern that this program can financially hurt low-income customers.

Note to Kmart: It will financially hurt anyone who buys something this way. That’s what happens when you introduce a payment method with an interest rate high enough to make Tony Soprano’s collection guy blush.

When you do rent-to-own, the “rent” owns you. And those sky-high interest rates happen everywhere you do rent-to-own, not just at Kmart. Want to avoid hurting your money? Avoid leasing.

Jump-Start Your Goals!

Jump-Start Your Goals!

Get our 8-Day JUMP START series and weekly newsletter that are packed with articles and tools to help you win with money.

Reach Your Money Goals

Reach Your Money Goals

Start with a budget. Join the millions already budgeting with EveryDollar!

Create My (FREE) Budget

Thank You!

Your 8-Day Jump Start is on its way to !

More from the Blog