What Happens If You Don’t Pay Progressive Leasing?
Ignoring your Progressive Leasing payments can lead to serious consequences, including legal action, damaged credit, and the loss of the leased item. Ultimately, failing to fulfill your lease agreement means you won’t own the property and could face significant financial repercussions.
Understanding Progressive Leasing
Progressive Leasing offers a lease-to-own option for consumers who may not qualify for traditional financing. This allows individuals to acquire desired items, such as furniture, electronics, and appliances, with manageable payments over a set period. However, it’s crucial to understand that this is a lease, not a purchase, until all obligations are met. Progressive Leasing partners with retailers, essentially purchasing the product and then leasing it to the customer. The customer then makes periodic payments until they either exercise an early purchase option or pay the full amount due.
The Benefits and Risks of Lease-to-Own
Lease-to-own arrangements like Progressive Leasing can be attractive for individuals with limited or no credit history, or those who need an immediate solution to acquire necessary items.
Benefits:
- Access to products without requiring upfront credit checks.
- Flexible payment options, often weekly, bi-weekly, or monthly.
- Opportunity to acquire ownership of desired items.
- Early buyout options, potentially reducing the total cost.
Risks:
- Significantly higher total cost compared to purchasing outright or using credit.
- Risk of losing the item if payments are missed.
- Potential impact on credit score if debt is sent to collections.
- May encourage the acquisition of items that are not financially feasible.
The Progressive Leasing Process
The process typically involves the following steps:
- Application: Apply online or at a participating retailer. Approval is often quick and based on factors other than traditional credit scores.
- Selection: Choose the desired item from the retailer’s inventory.
- Agreement: Review and sign the lease agreement, carefully noting the terms and conditions, including payment amounts, frequency, and buyout options.
- Possession: Take possession of the leased item.
- Payments: Make regular payments according to the agreed-upon schedule.
- Ownership: Exercise the early buyout option or complete all scheduled payments to gain full ownership.
Consequences of Non-Payment
Failing to pay Progressive Leasing has several negative consequences that escalate over time:
- Late Fees: Progressive Leasing will likely charge late fees for each missed or delayed payment. These fees can add up quickly, increasing the overall cost of the lease.
- Demand for Return: After a period of non-payment, Progressive Leasing will demand the return of the leased item. You are legally obligated to return the item if you cannot fulfill the lease agreement.
- Collection Efforts: If you fail to return the item or resume payments, Progressive Leasing will likely engage in collection efforts, which may include phone calls, letters, and emails.
- Damaged Credit: Progressive Leasing may report the defaulted account to credit bureaus, which can negatively impact your credit score. A lower credit score can make it difficult to obtain loans, credit cards, and other forms of credit in the future.
- Legal Action: In some cases, Progressive Leasing may pursue legal action to recover the outstanding balance or the leased item. This could result in a lawsuit and a judgment against you.
- Wage Garnishment: If Progressive Leasing obtains a judgment against you, they may be able to garnish your wages to recover the debt. This means a portion of your paycheck will be automatically deducted and sent to Progressive Leasing.
- Repossession: Progressive Leasing may attempt to repossess the leased item if you refuse to return it willingly. Repossession can be a stressful and embarrassing experience.
Early Purchase Options and Alternatives
Progressive Leasing typically offers early purchase options that allow you to acquire ownership of the item before the lease term expires. These options can often be more cost-effective than making all the scheduled payments. Consider the following alternatives if you are struggling to make payments:
- Contact Progressive Leasing: Discuss your situation with Progressive Leasing and explore potential solutions, such as a temporary payment plan or a reduced buyout offer.
- Negotiate a Settlement: Attempt to negotiate a settlement with Progressive Leasing, where you agree to pay a reduced amount in exchange for the cancellation of the lease.
- Return the Item: If you cannot afford to continue making payments, returning the item may be the best option to avoid further penalties and legal action.
- Seek Financial Counseling: Consult with a financial counselor to explore your options and develop a budget to manage your debt.
Frequently Asked Questions (FAQs)
Does Progressive Leasing Report to Credit Bureaus?
Progressive Leasing typically does not report payment activity to the major credit bureaus unless the account is in default and sent to collections. However, a default account in collections will significantly damage your credit score.
Can I Return the Item if I Can’t Afford Payments?
Yes, you absolutely can and should return the item if you cannot afford payments. This is often the best way to avoid further penalties and potential legal action.
What is the “Early Purchase Option”?
The early purchase option allows you to buy out the lease before the full term is completed. This option is usually cheaper than making all the scheduled payments. The price is usually determined by the remaining payments plus a small purchase fee.
What Happens if Progressive Leasing Sues Me?
If you are sued by Progressive Leasing, it’s crucial to respond to the lawsuit. Ignoring the lawsuit can result in a default judgment against you, which can lead to wage garnishment or other collection actions. Seek legal advice immediately.
Can Progressive Leasing Garnish My Wages?
Progressive Leasing can garnish your wages only if they obtain a court judgment against you.
How Does Late Payment Affect my Credit Score?
While Progressive Leasing generally doesn’t report to credit bureaus, if the account is sent to a collection agency, that collection agency will likely report the debt, leading to a negative impact on your credit score.
Can Progressive Leasing Repossess the Item?
Yes, Progressive Leasing has the right to repossess the leased item if you fail to make payments and refuse to return it voluntarily.
What if the Item is Damaged or Stolen?
You are usually responsible for the item while it’s in your possession. Your lease agreement likely outlines your responsibilities in case of damage or theft, which could include paying for the cost of the item.
Can I Negotiate with Progressive Leasing?
Yes, you can and should attempt to negotiate a payment plan or settlement with Progressive Leasing. Be prepared to explain your situation and offer a reasonable solution.
What is the Difference Between Leasing and Financing?
Leasing is essentially renting an item with the option to buy it later. Financing involves taking out a loan to purchase the item outright. Leasing typically has higher total costs than financing.
How Long Does Progressive Leasing Have to Sue Me?
The statute of limitations for debt collection varies by state. It’s crucial to understand the laws in your jurisdiction. Generally, after a specific time period (typically 3-6 years), Progressive Leasing cannot sue you to collect the debt.
Is Progressive Leasing a Good Option for Me?
Progressive Leasing can be a viable option if you have limited credit and need immediate access to an item. However, carefully consider the total cost and your ability to make payments before entering into a lease agreement. Consider all alternatives before making a final decision.