On its website, Wags Lending offers happy testimonials from effusive but anonymous pet owners who used lease financing to buy pups. When asked to furnish a satisfied customer for an interview, the company suggested Elizabeth Harvey, a college student, and Kristin Smith, a Reno salon owner.
Harvey, 24, used a Wags lease to take home a Chihuahua from an Erie, Pennsylvania, pet store. In the past, Harvey said, she had adopted rescues. The contract was expensive, but she was already enamored of the pooch, which she named Little. Later, once she’d taken Little home and realized she was leasing him, she called Wags to complain, and the company waived several months’ worth of payments. “I probably wouldn’t feel so thankful if it was any other dog,” she said. “For some reason, I just connected to this one.”
Smith, 40, has used leases from Bristlecone for two dogs, both Morkies—a Maltese-Yorkie hybrid. She bought the first dog, Julius, on a whim after walking into a local pet store without a credit card. “It was like, I didn’t want to leave without him,” she said. After Julius was killed in a traffic accident, Smith worked with Bristlecone to craft a lease for a new dog, which she named Monsieur Fluffington (“the smaller the dog, the longer the name”). “I can’t say enough good things about Wags,” she said.
Last summer, a consumer watchdog lawyer named Margot Saunders got a call from a friend in West Virginia, asking her to take a look at an unusual contract. The papers described a lease transaction for two teacup Yorkies underwritten by Wags Lending.
Saunders, of counsel to the National Consumer Law Center, thought the contract looked like it might not hold up as a lease in court.
Under the federal Consumer Leasing Act, the defining characteristic of a lease is that the lessor can take back and remarket the underlying asset. That distinction, Saunders said, has been crucial to convincing lawmakers that leases are different from loans and shouldn’t be subject to caps on interest rates.
Saunders didn’t think the contract for the teacup Yorkies met that standard. Before she could pursue a lawsuit, though, the lessee settled her complaint for a refund.
Now, Saunders is looking for another aggrieved customer so she can test the legality of the contract in court, on the theory that a dog can’t be redeemed and resold at the end of a lease, as a car might be. “There’s no real contemplation with a dog that you’re going to run it back in.”
Wunderlich says his company’s contracts legally qualify as leases. When the company can’t get pet stores to take back dogs, he said, Bristlecone itself works to find new owners, sometimes flying the dogs back to Nevada.
Last July, Wunderlich traveled to Sun Valley, Idaho, for a conference attended by attorneys general of Western states—part of a regular effort to assure regulators he’s complying with state leasing law. He says he’s also met with staff from attorney general’s offices in New York, New Jersey, Kansas, and Virginia.