Democratic congressman asks the CFPB to investigate ‘rent now, pay later’ companies
Summary
A Democratic congressman, Rep. Maxwell Frost from Florida, has asked the Consumer Financial Protection Bureau (CFPB) to investigate “rent now, pay later” companies. These companies let renters pay their rent in smaller installments but may charge high fees and cause confusion about costs.Key Facts
- Rep. Maxwell Frost sent a letter to the CFPB urging an investigation into rent now, pay later (RNPL) companies.
- RNPL services let renters split monthly rent into multiple smaller payments over the month.
- Some companies, like Flex and Livble, and the buy now, pay later firm Affirm, offer these rent payment plans.
- These plans can come with high fees; some renters pay up to $50 monthly in extra charges.
- RNPL products differ from services like Bilt, which uses credit cards and rewards points for rent payments.
- Frost compares many RNPL products to payday loans and calls for more clear information for consumers.
- The CFPB’s enforcement and regulatory activity has decreased under Acting Director Russell Vought.
- Consumer groups argue RNPL products should follow truth in lending rules, but the industry disagrees.
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