Section 1 Short title
This Act may be cited as the “Expanding Rent-to-Own Protections Act of 2016”.
Expanding Rent-to-Own Protections Act of 2016
A BILL
To amend the Consumer Financial Protection Act of 2010 to establish requirements relating to rent-to-own transactions, and for other purposes.
Sec. 2 Rent-to-own transactions
Definition of rent-to-Own transaction— Section 1002(5) of the Consumer Financial Protection Act of 2010 (12 U.S.C. 5481(5)) is amended—
by redesignating subparagraphs (A) and (B) as clauses (i) and (ii), respectively (and conforming the margins accordingly);
in clause (ii), as so redesignated, by striking the period at the end and inserting “; or”;
by striking “means any financial product or service that is described in one or more categories under—” and inserting
“(A) any financial product or service that is described in one or more categories under—”
by adding at the end the following new subparagraph:
“(B) a contract in the form of a terminable lease or bailment of personal property (other than a lease or bailment of a motor vehicle as defined in section 1029(f)) used by a consumer primarily for personal, family, or household purposes, under which—
“(i) a consumer has the right of possession and use of such property and has the option to renew the contract periodically by making payments specified in the contract; and
“(ii) a seller agrees, in writing or orally, to transfer ownership of such property to the consumer upon the fulfillment of all obligations of the consumer under the contract for that transfer.”
Regulations relating to rent-to-Own transactions— Pursuant to authority granted under section 1031 of the Consumer Financial Protection Act of 2010 (12 U.S.C. 5531), the Bureau of Consumer Financial Protection shall prevent unfair, deceptive, or abusive acts or practices in connection with any contract described in section 1002(5)(B) of the Consumer Financial Protection Act of 2010 (as added by this Act) and, not later than 1 year after the date of the enactment of this Act, shall issue regulations identifying methods to protect consumers from entering into such contracts.