Home & Garden

Woman hit with $32,000 bill to break furnace, air conditioner rental contract, after paying $7000 in rental fees

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  • Feb 8th, 2020 9:47 am
[OP]
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Woman hit with $32,000 bill to break furnace, air conditioner rental contract, after paying $7000 in rental fees

https://www.cbc.ca/news/business/home-e ... -1.5439572

After paying more than $7,000 total in monthly rental fees since 2016, she was told she'd have to pay another $32,406 to buy out her contract, giving her ownership of the appliances.

According to her contract, Spence's furnace and air conditioner had a combined "cash selling price" of $10,798. That's a far cry from the approximately $40,000 she'd be out for renting the appliances and then buying out the rest of her 10-year contract — which includes service and warranty protection.

"I feel so completely stupid for getting myself involved in this," said Spence, who was sold on the rental deal by a door-to-door salesperson.


Crown Crest's external legal counsel said that an error had been made in quoting Spence a $32,406 buyout price.

"It was just something everyone missed," said lawyer Alfred Apps. "We're going to step in and resolve this positively in favour of the customer."
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May 10, 2005
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So, a mistake was made in the calculation. It is unknown what the real buyout cost is? This is now a non story.

Having said that, It mystifies me what people expect when the sign a contract to pay $XX per month for XX years and then cry when they want to buy it out and realize they owe the contractual amount.
The Government cannot give to anybody anything that the Government does not first take from somebody else.
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Sep 6, 2017
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Pete_Coach wrote: So, a mistake was made in the calculation. It is unknown what the real buyout cost is? This is now a non story.

Having said that, It mystifies me what people expect when the sign a contract to pay $XX per month for XX years and then cry when they want to buy it out and realize they owe the contractual amount.
Read the koodo phone deals.
[OP]
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Mar 23, 2009
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Pete_Coach wrote: So, a mistake was made in the calculation. It is unknown what the real buyout cost is? This is now a non story.

Having said that, It mystifies me what people expect when the sign a contract to pay $XX per month for XX years and then cry when they want to buy it out and realize they owe the contractual amount.
It was a "miscalculation" only after CBC got involved. Several checks had determined that $32400 number quoted to her.

Any of their agents should have picked up such a "miscalculation", considering that $32400 is totally ridiculous.

In the meantime:

The company that brokered Spence's deal — Consumers Choice Comfort Services — appears to no longer exist.

Even so, it currently faces 18 charges under the Ontario Consumers Protection Act, including charges of false or misleading business practices, according to the Ontario government.
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Aug 5, 2002
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Won't be much off anyways, $32,400 was probably day 1 of the contract, if they had cancelled it right after it was installed. These companies are crooks, taking advantage of people that either don't understand English or are vulnerable. Door to Door sales should have been banned a long time ago and glad that it is now.
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EugW wrote: It was a "miscalculation" only after CBC got involved. Several checks had determined that $32400 number quoted to her.

Any of their agents should have picked up such a "miscalculation", considering that $32400 is totally ridiculous.

In the meantime:

The company that brokered Spence's deal — Consumers Choice Comfort Services — appears to no longer exist.

Even so, it currently faces 18 charges under the Ontario Consumers Protection Act, including charges of false or misleading business practices, according to the Ontario government.
Does not change my comment about people’s obligations when they sign a contract.
The Government cannot give to anybody anything that the Government does not first take from somebody else.
[OP]
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Mar 23, 2009
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Jeff146 wrote: Won't be much off anyways, $32,400 was probably day 1 of the contract, if they had cancelled it right after it was installed. These companies are crooks, taking advantage of people that either don't understand English or are vulnerable. Door to Door sales should have been banned a long time ago and glad that it is now.
So I just made up some high prices and did some calculations using a ridiculous 15% interest rate:

Furnace and AC: $8000
15% interest
10 year payment plan

Total cost $15225.65, or $126.88 per month over 10 years.

Add $9.99 per month HVAC maintenance plan:
$126.88 + $9.99 = $136.87 per month + 13% Ontario tax = $154.66 per month = $18559.57 over 10 years / 120 months.

She had been paying since 2016, so let's say about 45 months which works out to $6959.84, which is very close to the $7000 she claimed to have already paid. So, what that would mean is she would have still owed about $11000-12000, which is over $20000 less than that $32400 quote she got.
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Aug 5, 2002
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EugW wrote: So I just made up some high prices and did some calculations using a ridiculous 15% interest rate:

Furnace and AC: $8000
15% interest
10 year payment plan

Total cost $15225.65, or $126.88 per month over 10 years.

Add $9.99 per month HVAC maintenance plan:
$126.88 + $9.99 = $136.87 per month + 13% Ontario tax = $154.66 per month = $18559.57 over 10 years / 120 months.

She had been paying since 2016, so let's say about 45 months which works out to $6959.84, which is very close to the $7000 she claimed to have already paid. So, what that would mean is she would have still owed about $11000-12000, which is over $20000 less than that $32400 quote she got.
The big assumption is putting the cost of furnace and AC at $8000 which is what an average person would pay including installation but they could basically charge anything they want including exorbitant installation fees. You also forgot I believe they is probably a fee, maybe a couple of grand to break the contract.


Again, crooks.
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Aug 5, 2002
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Pete_Coach wrote: So, a mistake was made in the calculation. It is unknown what the real buyout cost is? This is now a non story.

Having said that, It mystifies me what people expect when the sign a contract to pay $XX per month for XX years and then cry when they want to buy it out and realize they owe the contractual amount.
I don't disagree with you but not everyone understands or reads English and the door salesman probably telling them what they want to hear or speaking their language and conning them. If they actually tell them what they are paying and what the actually contract obligations, I doubt a lot of people would agree to it.
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Jeff146 wrote: I don't disagree with you but not everyone understands or reads English and the door salesman probably telling them what they want to hear or speaking their language and conning them. If they actually tell them what they are paying and what the actually contract obligations, I doubt a lot of people would agree to it.
Well, if a person does not understand the language the contract written, the should get help. I am not being harsh but it is getting more and more common that folks complain (to the media) about things they willingly did. Just call the media and get out of your deal.
At a point, a person needs to take responsibility for themselves and ownership of their action.
The Government cannot give to anybody anything that the Government does not first take from somebody else.
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Dec 4, 2016
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EugW wrote: So I just made up some high prices and did some calculations using a ridiculous 15% interest rate:

Furnace and AC: $8000
15% interest
10 year payment plan

Total cost $15225.65, or $126.88 per month over 10 years.

Add $9.99 per month HVAC maintenance plan:
$126.88 + $9.99 = $136.87 per month + 13% Ontario tax = $154.66 per month = $18559.57 over 10 years / 120 months.

She had been paying since 2016, so let's say about 45 months which works out to $6959.84, which is very close to the $7000 she claimed to have already paid. So, what that would mean is she would have still owed about $11000-12000, which is over $20000 less than that $32400 quote she got.
$10 a month for HVAC maintenance might be a little low. In Ottawa, good annual furnace service can easily cost 200, so $20 a month is probably a reasonable assumption.
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Aug 5, 2002
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Pete_Coach wrote: Well, if a person does not understand the language the contract written, the should get help. I am not being harsh but it is getting more and more common that folks complain (to the media) about things they willingly did. Just call the media and get out of your deal.
At a point, a person needs to take responsibility for themselves and ownership of their action.

Don't disagree with you there but again, it's the door to door sales tactics and making you sign right there .. etc. That's what they are trying to get you to do so they make the commission. They don't tell you, don't worry I'll come back another day where someone can translate this for you and explain it to you.

Now if they weren't going door to door and not pressuring you and someone's signs it, definitely no sympathy there and own up to your actions but those types of contracts are definitely there to trick the more vulnerable.
[OP]
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BlueSolstice wrote: $10 a month for HVAC maintenance might be a little low. In Ottawa, good annual furnace service can easily cost 200, so $20 a month is probably a reasonable assumption.
I was going by this article, which said $100-120 a year:

https://www.thestar.com/business/person ... th_it.html

However, it's an older article, so I'll take your word for it that it would be closer to $200. However, even if we were to assume $19.99 per month, or ~$240 per year, that's only $120 more per year than my original calculation, or only $1356 more over 10 years including tax. That would bring the total pricing to just under $20000, which is still nowhere near the ~$40000 total she was going to have to pay until she got CBC involved.
Jeff146 wrote: The big assumption is putting the cost of furnace and AC at $8000 which is what an average person would pay including installation but they could basically charge anything they want including exorbitant installation fees. You also forgot I believe they is probably a fee, maybe a couple of grand to break the contract.


Again, crooks.
I actually was thinking $8000 was a bit on the high side, unless she lives in a big house, or went with uber high end stuff. But yeah of course, they could have just ripped her off there too.

BTW, the article called her a single mom. I take issue with that. While technically true, her two sons that live with her are actually adults. So unless they are disabled or sick or something, her being a single mom probably shouldn't be relevant here.
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Lol the comments on the CBC site are going to town on the shifty use of “single mom sympathy card”

But it’s the CBC, everything has to be filtered thru their PC lens.

It’s not enough anyways to ban door to door. Appliance rentals should be banned full stop. It just allows this predatory pricing with the backing of the legal system (liens). It’s infuriating since builders tie it into new build housing for water heaters. And now they can sell the Eco angle are pushing tankless and Polaris which are about $5,000 and is way more than one of these should cost for simply a machine that provides hot water.
"It is in times of great fear or greed that the most opportunity exists."
[OP]
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cartfan123 wrote: Lol the comments on the CBC site are going to town on the shifty use of “single mom sympathy card”

But it’s the CBC, everything has to be filtered thru their PC lens.

It’s not enough anyways to ban door to door. Appliance rentals should be banned full stop. It just allows this predatory pricing with the backing of the legal system (liens). It’s infuriating since builders tie it into new build housing for water heaters. And now they can sell the Eco angle are pushing tankless and Polaris which are about $5,000 and is way more than one of these should cost for simply a machine that provides hot water.
I don't think appliance rentals should be illegal. I agree they can be the source of predatory pricing, but nonetheless that in itself isn't a good justification.

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