"This new law will bring transparency to consumers and guarantee they are armed with enough information to make a well-informed decision.” - State Senator Dave Koehler (D-Peoria)

PEORIA – Legislation protecting consumers from deceptive leases was signed into law last week. Senate Bill 885 will protect renters from “rent-to-own” schemes that are often fraught with deceptive terms and conditions.

In a survey conducted by Housing Action Illinois, only 12% of housing counselors reported they believed people considering rent-to-own home ownership opportunities understand the differences between rent-to-own and home ownership with a mortgage.

State Senator Dave Koehler (D-Peoria) sponsored the Installment Sales Contract Act and issued the following statement:

“Deceptive lending practices are a recipe for financial disaster. Rent-to-own leases are often misleading and hit consumers with ballooning costs and hidden fees. This new law will bring transparency to consumers and guarantee they are armed with enough information to make a well-informed decision.”

Under the new law, renters who enter into rent-to-own contracts must be given information such a schedule of payments and a record of the contract. The law also expands eligibility for foreclosure protections and prohibits prepayment penalties.

The legislation was carried in the House of Representatives by Representative Jehan Gordon-Booth (D-Peoria).

The new law takes effect January 1, 2018.