Rent to Own contracts have a set term to pay off. These rent to own contracts may or may not have a finance charge. If there is a finance charge, the finance charge is based on a fixed interest, declining rate. The interest disclosed at the time of contract issue is all the interest that can be collected on the contract. Contracts of this type usually have provisions for late charges to be collected if payments are late. If the contract is paid off early, the interest will be rebated off the balance (like most installment contracts). Rent to Own contracts may also be considered Lease Purchase rentals. Lease Purchase contracts would not have a finance charge but may instead have a lease fee that is an even amount calculated into each payment.

Sales contracts are similar to Rent to Purchase contracts with the exception being on a Sales contract the inventory is considered sold at the time of contract issue as opposed to the time the contract is paid off.

Simple Interest Rent contracts are rent to own contracts with a set term to pay off. These contracts do have a finance charge and the finance charge is based on a simple interest rate. Simple interest contracts calculate interest due on the principal from the time the last payment was made to the time of the current payment. For this reason, the amount of interest actually collected on the contract may be more than what was disclosed on the contract at the time of contract issue.

Simple Interest Sales contracts are similar to Simple Interest Rent contracts with the exception being on a Simple Interest Sales contract the inventory is considered sold at the time of contract issue as opposed to the time the contract is paid off.

Screen shot of the Details tab prior to clicking the Calculate button.

Screen shot of the Details tab after the Calculate button is clicked (with 15.9% interest).

If the contract default was set up to ask for the Student name and School the student attends, the Student and School boxes will be available. If this option was not selected on the contract default, the Student and School boxes will not appear on the Details tab. Refer to 'Rental Defaults' for more information.

Student

The name of the student (if applicable) renting the item selected on the Inventory tab.

School

The name of the school the student attends, if applicable. You may click in the School box and select the school from the drop down list. The schools are maintained in 'Add/Change Schools' on the Rental Maintenance menu. For more information, refer to 'Schools' .

Note: Whether tax is broken out of the amounts entered on the contract or calculated on the amounts entered is determined by the option 'Amounts Entered in the Rental Program Include Tax'. This option can be found on the Miscellaneous tab in Workstations on the General Maintenance menu. If this option is selected, the tax will be broken out of the amount entered. If this option is not selected, the tax will be calculated on the amount entered. Refer to 'Workstations' for more information.

Maint

If the contract has a monthly maintenance fee, type the amount in the Maint box.

If Maintenance is taxable in your state, the tax portion of the maintenance amount will be added to the amount appearing in bold next to the Payment box.

Lease Fee

If the contract has a monthly lease fee, type the amount in the Lease Fee box.

If the Lease Fee is taxable in your state, the tax portion of the lease fee amount will be added to the amount appearing in bold next to the Payment box.

Payment

Type the rental payment in the Payment box.

If rent is taxable in your state, the tax portion of the payment amount will be added to the amount appearing in bold next to the Payment box.

Note: If you want the software to calculate the payment amount according to a set term, leave the Payment box blank.

Total # Payments

The total number of payments the customer must make before the contract is paid off.

Note: If you want the software to calculate the term according to the payment amount entered in the Payment box, leave the Total # Payments box blank.

… Payments @ … with 1 Final Pay @ …

The payment terms of the contract will be calculated once you have completed entering the information pertaining to the contact and the Calculate button is clicked.

Previous Rent Credit

If the customer has rent accumulated from a previous contract that is to be applied to this contract, enter the amount in the Previous Rent Credit box. The Amt to Finance will be reduced by the amount entered as previous rent credit.

Previous Rent Credit Mos

If an amount was entered in the Previous Rent Credit box, enter the number of months the customer received rent credit for. The Previous Rent Credit Mos is for your information only and is not referred to on Rent to Own contracts. This may be left at 0.00.

DownPay

If the customer is making a down payment at the time of contract issue, enter the amount in the DownPay box. The down payment entered should exclude Maintenance, Lease Fee and Deposit. The tax portion of the down payment will appear in bold next to the DownPay box.

Amt to Finance

The amount to finance will calculate as the Price + Tax – Previous Rent Credit – Down Payment – Tax on Down Payment. It is this amount that the finance charge, if applicable, will be calculated on.

Finance Chg

If the contract default for the Rent to Own contract you are entering was set up with an interest rate, upon clicking the Calculate button the finance charge will be calculated according to the Amt to Finance and Interest Rate.

The Finance Chg box should be left blank as this amount is calculated.

Balance

The Balance will appear as the Amt to Finance. Once the Calculate button is clicked and if there is a finance charge on the contract, the Balance will calculate as the Amt to Finance + Finance Charge.

Calculate

Once the Down Payment has been entered, the Calculate button should be clicked in order to calculate the payment terms of the contract, the finance charge (if applicable) and the outstanding balance.

Maint Rcvd

If the customer is making a maintenance payment at the time of contract issue, enter the amount in the Maint Rcvd box.

Lease Fee Rcvd

If the customer is making a lease fee payment at the time of contract issue, enter the amount in the Lease Fee Rcvd box.

Deposit Rcvd

If the customer is paying a deposit on the contract, enter the amount in the Deposit Rcvd box.

Note: The Deposit refers to a security deposit that may either be refunded or applied to a payment at a later date.

Contract Date

The Contract Date will default to the system date of the workstation. If the contract was issued on a date other than the system date, change the Contract Date as necessary.

Down Pay Rcvd

The Down Payment Received Date will default to the Contract Date. If the down payment was received on a date other than the contract date, click in the DownPayRcvd box and change the date as necessary.

1st Pay Due

The First Payment Due Date will default to the Contract Date + Payment Frequency established on the contract default. If the payment frequency was set to monthly, the first payment due date will automatically appear as one month past the contract date. The day within the first payment due date determines the day of the month all subsequent payments are due.

Example: If all contract payments are due on the 15th of the month, you want to be certain the day within the first payment due date is 15.

Interest Date

Interest Date is applicable to the Simple Interest types of contracts only.

The Interest Date will default to the Contract Date + Number of Months of Free Interest established on the contract default. The date to begin charging interest may be changed if necessary.