<PAGE>   1
                                                                    EXHIBIT 10.1




                                 August 17, 1998

Mr. James G. Steckart
President and CEO
Home Choice Holdings, Inc.
714 E. Kimbrough
Mesquite, Texas  75149

         Re: Waiver and Second Amendment ("Waiver and Amendment") under the
         Amended and Restated Revolving Credit Agreement dated as of April 1,
         1998 (as amended, the "Credit Agreement") among Home Choice Holdings,
         Inc., as successor by merger to Alrenco, Inc. (the "Company"), the
         Banks named therein and Comerica Bank as Agent for the Banks (the
         "Agent")



Ladies and Gentlemen:

         Reference is made to the Credit Agreement. Except as specifically
defined to the contrary herein, capitalized terms used in this Waiver and
Amendment shall have the meanings given them in the Credit Agreement. This
Waiver and Amendment shall not become effective unless and until countersigned
by the Company and returned to the Agent within five (5) days from the date of
this letter.

         As you know, for the fiscal quarter ending June 30, 1998, the Company
is required to maintain the following financial covenant levels under the Credit
Agreement: (a) pursuant to Section 8.10, a Positive Net Income of not less than
$1.00; (b) pursuant to Section 8.11, a Fixed Charge Coverage Ratio of not less
than 1.75 to 1.0; and (c) pursuant to Section 8.12A, a Total Debt to EBITDA
Ratio of not more than 4.0 to 1.0. The Company has advised the Agent and the
Banks that for its fiscal quarter ending June 30, 1998, the Company was not in
compliance with these financial covenants and the Company requested that the
Agent and the Banks waive compliance under the Credit Agreement with these
Sections of the Credit Agreement. The Agent and the Banks have given the Company
a verbal waiver and are formalizing such waiver in this Waiver and Amendment.

         The Company has also requested that the Agent and the Banks agree to
certain amendments to the Credit Agreement.







<PAGE>   2

James G. Steckart
President and CEO
Home Choice Holdings, Inc.
August 17, 1998
Page 2





         Based on the Agent's receipt of the approval of the requisite Banks and
subject to the conditions set forth in the penultimate paragraph of this letter
agreement, this letter agreement will confirm that the Banks hereby:

         (a) waive compliance by the Company under the Credit Agreement with
Section 8.10 (Positive Net Income), Section 8.11 (Fixed Charge Coverage Ratio),
and Section 8.12A (Total Debt to EBITDA Ratio) of the Credit Agreement for its
fiscal quarter ending June 30, 1998, and

         (b) amend the following Sections of the Credit Agreement:

                (i)   The definition of "EBITDAR" is hereby amended and restated
                in its entirety as follows:

                           "`EBITDAR' of any Person shall mean, for any period,
                      the sum of (a) Net Income for such period (without giving
                      effect to (i) any one-time cash charges in an aggregate
                      amount not to exceed $10,000,000 and any one-time non-cash
                      charges in an aggregate amount not to exceed $1,000,000
                      arising from the Merger and (ii) any reasonable and
                      customary investment banking fees, accountant's fees, and
                      legal fees incurred by the Company in an aggregate amount
                      not to exceed $500,000 for the four fiscal quarters then
                      ending arising from any acquisition and/or mergers other
                      than the Merger, in each case without netting the amount
                      of any taxes attributable thereto) plus (b) to the extent
                      deducted in the computation of such Net Income, (i) all
                      amounts treated as expenses for depreciation of fixed
                      assets, amortization of intangible assets and interest
                      paid or payable on the Debt of such Person for such
                      period, (ii) all accrued taxes on or measured by income
                      and (iii) the amount of all Rental Expenses, determined in
                      each case in accordance with GAAP."

                (ii)  The definition of "Fixed Charge Coverage Ratio" is hereby
                amended and restated in its entirety as follows:

                           "`Fixed Charge Coverage Ratio' shall mean as of any
                      date of determination, a ratio (i) the numerator of which
                      shall be equal to the sum of EBITDAR for the Measuring
                      Period then ending, and (ii) the denominator of which
                      shall be Fixed Charges for the Measuring Period then
                      ending. For purposes of this definition, "for the
                      Measuring Period then ending" shall mean (x) for the
                      fiscal quarter ending on June 30, 1998, the period
                      beginning on January 







<PAGE>   3

James G. Steckart
President and CEO
Home Choice Holdings, Inc.
August 17, 1998
Page 3





                      1, 1998 and ending on June 30, 1998; (y) for the fiscal
                      quarter ending on September 30, 1998, the period beginning
                      on January 1, 1998 and ending on September 30, 1998; and
                      (z) for the fiscal quarter ending on December 31, 1998 and
                      for each fiscal quarter ending thereafter, the period of
                      four consecutive fiscal quarters ending on the date of
                      determination."

                (iii) The definition of "Fixed Charges" is hereby amended and
                restated in its entirety as follows:

                           "`Fixed Charges' of any Person shall mean, for any
                      period of determination, the sum, without duplication, of
                      (i) all interest expense paid or payable during such
                      period on the Total Debt of such Person plus (ii) the
                      amount of all Rental Expenses of such Person during such
                      period, all determined in accordance with GAAP plus (iii)
                      all cash dividends paid by Company pursuant to Section 9.6
                      hereof."

                (iv)  The definition of "Permitted Acquisition" is amended as
                follows:

                                   (A) Paragraph (c) thereof is amended and 
                      restated in its entirety as follows:

                                   "(c) in the event that the value of such 
                           proposed new acquisition, computed on the basis of
                           total acquisition consideration paid or incurred, or
                           to be paid or incurred, by the Company or its
                           Subsidiaries with respect thereto, including all
                           indebtedness which is assumed or to which such
                           assets, businesses or business or ownership interests
                           or shares, or any Person so acquired, is subject, and
                           including in the calculation of the value of such
                           acquisition the value of any common shares
                           transferred as a part of such acquisition,

                                        (i) shall be greater than or equal to
                                   Ten Million Dollars ($10,000,000), determined
                                   as of the date of such acquisition, or

                                        (ii) when combined with the value of all
                                   other acquisitions conducted as Permitted
                                   Acquisitions in the same fiscal year shall be
                                   greater 








<PAGE>   4

James G. Steckart
President and CEO
Home Choice Holdings, Inc.
August 17, 1998
Page 4


                                   than or equal to (x) for fiscal year 1998,
                                   Sixteen Million Five Hundred Thousand Dollars
                                   ($16,500,000), determined as of the date of
                                   such acquisition, (y) for fiscal year 1999,
                                   Thirty Five Million Dollars ($35,000,000),
                                   determined as of the date of such
                                   acquisition, and (z) for fiscal year 2000 and
                                   thereafter, Fifty Million Dollars
                                   ($50,000,000), determined as of the date of
                                   such acquisition,

                              then not less than thirty (30) nor more than
                              ninety (90) days prior to the date each such
                              proposed acquisition is scheduled to be
                              consummated, the Company provides written notice
                              thereof to Agent, accompanied by (A) draft of the
                              letter of intent and, when available, all material
                              documents pertaining to such proposed acquisition,
                              (B) detail setting forth the acquisition price
                              with supporting documentation and historical
                              financial information (including income statement,
                              balance sheet and cash flows) covering at least
                              three complete fiscal years of the acquisition
                              target prior to the effective date of the
                              acquisition or the entire credit history of the
                              acquisition target, whichever period is shorter
                              (provided, however, that, if the financial
                              information referred to in this subparagraph (B)
                              is not available, Company shall furnish Agent with
                              financial information otherwise reasonably
                              satisfactory to the Majority Banks, and (C) Pro
                              Forma Projected Financial Information, whereupon
                              Agent shall promptly notify each of the Banks of
                              its receipt thereof and upon the written request
                              of any Bank distribute copies of all notices and
                              other materials received from Company under this
                              clause (c) to each Bank;"

                          (B) Paragraph (d) thereof is amended and restated as
                          follows:

                                   "(d) in the event that the value of such
                              proposed new acquisition, computed on the basis of
                              total acquisition consideration paid or incurred,
                              or to be paid or incurred, by the Company or its
                              Subsidiaries with respect thereto, including all
                              indebtedness which is assumed or to which such
                              assets, businesses or business or ownership
                              interests or shares, or any Person so acquired, is
                              subject, and including 








<PAGE>   5

James G. Steckart
President and CEO
Home Choice Holdings, Inc.
August 17, 1998
Page 5



                              the value of any common shares transferred as a
                              part of such acquisition is less than Ten Million
                              Dollars ($10,000,000) determined as of the date of
                              such acquisition, then not less than ten (10)
                              Business Days after date each such proposed
                              acquisition has been consummated, the Company
                              provides written notice thereof to Agent (with
                              certified copies of all material documents
                              pertaining to such acquisition), whereupon Agent
                              shall promptly notify each of the Banks of its
                              receipt thereof and upon the written request of
                              any Bank distribute copies of all notices and
                              other materials received from Company under this
                              clause (d) to each Bank;"

                  (v)    The definition of "Total Debt to EBITDA Ratio" is
                  hereby amended and restated in its entirety as follows:

                              "`Total Debt to EBITDA Ratio' shall mean as of the
                         end of each fiscal quarter, a ratio (i) the numerator
                         of which shall be equal to Total Debt as of the last
                         day of such fiscal quarter and (ii) the denominator of
                         which shall be EBITDA for the Measuring Period then
                         ending. For the purposes of this definition, " EBITDA
                         for the Measuring Period then ending" shall mean (x)
                         for the fiscal quarter ending on June 30, 1998, EBITDA
                         for the period beginning on January 1, 1998 and ending
                         on June 30, 1998 multiplied by 2.00; (y) for the fiscal
                         quarter ending on September 30, 1998, EBITDA for the
                         period beginning on January 1, 1998 and ending on
                         September 30, 1998 multiplied by 1.33; and (z) for the
                         fiscal quarter ending on December 31, 1998 and for each
                         fiscal quarter ending thereafter, EBITDA for the period
                         of four consecutive fiscal quarters ending on the date
                         of determination."

                  (vi)   Section 2.10 (Optional Increase in Commitment) is
                  amended by amending the first line thereof by replacing the 
                  first word "Provided" with "provided" and by inserting at the 
                  beginning of the sentence the phrase "With the prior written 
                  approval of the Majority Banks and".

                  (vii)  Section 8.1 is amended by adding new clause (c) 
                  immediately following clause (b) thereof, as follows:

                              "(c) during each month in fiscal year 1998 and, if
                         requested by the Agent, during any subsequent fiscal
                         year, as soon 








<PAGE>   6
James G. Steckart
President and CEO
Home Choice Holdings, Inc.
August 17, 1998
Page 6


                         as available, but in any event not later than twenty
                         (20) days after the end of each month, the unaudited
                         consolidated and consolidating financial statements of
                         the Company as at the end of such month and the related
                         unaudited statements of income, accumulated earnings,
                         cash flows and balance sheets of the Company for the
                         portion of the fiscal year through the end of such
                         quarter, certified by a Responsible Officer as being
                         fairly stated in all material respects.".

                  (viii) Section 8.10 (Positive Net Income) is hereby amended
                  and restated in its entirety as follows:

                              "8.10 Positive Net Income. Maintain (a) during
                         fiscal year 1998, as of the end of each month beginning
                         with the month ending July 31, 1998, and (b) during
                         fiscal year 1999 and thereafter as of the end of each
                         fiscal quarter, Net Income (exclusive of any tax
                         benefit resulting from a loss carry forward or
                         otherwise, plus to the extent deducted in the
                         computation of such Net Income, all accrued taxes on or
                         measured by income, and without giving effect, but
                         without duplication, to one-time cash charges in an
                         aggregate amount not to exceed $10,000,000 and any
                         one-time non-cash charges in an aggregate amount not to
                         exceed $1,000,000 arising from the Merger for the first
                         two fiscal quarters ending after the Merger, as such
                         charges were given effect prior to giving effect to any
                         taxes on or measured by income) greater than zero."

                  (ix) Section 8.11 (Fixed Charged Coverage Ratio) is hereby
                  amended and restated in its entirety as follows:

                              "8.11 Fixed Charge Coverage Ratio. Maintain a
                         Fixed Charge Coverage Ratio of not less than the ratio
                         set forth below during the applicable period set forth
                         below:


<TABLE>
<CAPTION>



--------------------------------------------------------------------------------
               Quarter(s) Ending                                       Ratio
<S>                                                              <C>
--------------------------------------------------------------------------------
         September 30, 1998                                          1.35 to 1.0
--------------------------------------------------------------------------------
         December 31, 1998                                           1.60 to 1.0
--------------------------------------------------------------------------------
         March 31, 1999                                              1.80 to 1.0
--------------------------------------------------------------------------------
         June 30, 1999                                               2.15 to 1.0
--------------------------------------------------------------------------------
         September 30, 1999 through March 31, 2000                   2.25 to 1.0
--------------------------------------------------------------------------------
         June 30, 2000 and thereafter                                2.35 to 1.0
--------------------------------------------------------------------------------
</TABLE>

<PAGE>   7

James G. Steckart
President and CEO
Home Choice Holdings, Inc.
August 17, 1998
Page 7




                  (x) Section 8.12A (Total Debt to EBITDA Ratio) is amended in
                  its entirety as follows:

                         "8.12A Total Debt to EBITDA Ratio. Maintain, as of
                  the last day of each fiscal quarter, a Total Debt to EBITDA
                  Ratio of not more than the ratio set forth below as of the
                  last day of the applicable fiscal quarter set forth below:

<TABLE>
<CAPTION>

--------------------------------------------------------------------------------
             Quarter(s) Ending                                     Ratio
<S>                                                              <C>
--------------------------------------------------------------------------------
       September 30, 1998                                        5.25 to 1.0
--------------------------------------------------------------------------------
       December 31, 1998                                         3.75 to 1.0
--------------------------------------------------------------------------------
       March 31, 1999 and thereafter                             3.50 to 1.0
--------------------------------------------------------------------------------
</TABLE>



                  (xi)  Section 9 is hereby amended by adding new Section 9.13
                  immediately following Section 9.12, as follows:

                             "9.13. Limitation on Opening of New Stores. Except
                        (x) with the prior written consent of the Majority
                        Banks, or (y) in connection with stores acquired
                        pursuant to a Permitted Acquisition, during fiscal year
                        1998 (beginning on August 1, 1998) open any new stores,
                        and during fiscal year 1999 open more than twenty-five
                        (25) new stores."


                  (xii) New Schedule 1.1 (Applicable Fee Percentages and
                  Eurocurrency Margins), attached hereto as Attachment I, shall
                  replace existing Schedule 1.1 in its entirety.

         This Waiver and Amendment shall be come effective (according to the
terms and as of the date hereof) upon satisfaction by the Company of the
following conditions:

                  1.    The Company shall have delivered to the Agent the 
         following documents which were to have been executed and delivered to
         the Agent in connection with the reincorporation of the Company by way
         of merger on June 


<PAGE>   8

James G. Steckart
President and CEO
Home Choice Holdings, Inc.
August 17, 1998
Page 8





         23, 1998 and with the First Amendment to the Credit Agreement dated as
         of June 22, 1998: 

                  (a)    Assumption Agreement to be executed by Home Choice
                         Holdings, Inc.;

                  (b)    Reaffirmation of Certain Loan Documents to be executed
                         by Home Choice Holdings, Inc;

                  (c)    Incumbency Certificate for the list of persons
                         authorized to sign on behalf of Home Choice Holdings,
                         Inc. (that is James G. Steckart, John T. Egeland and
                         Tracy Schrader);

                  (d)    Legal Opinion of King & Spalding; and

                  (e)    Financing Statements (both UCC-1's and 3's) to be
                         executed in connection with the reincorporation and the
                         acquisition of certain new stores; and

                  2.     the Company shall have paid (a) to the Agent, for
         distribution to the Banks, as applicable, all fees (including any
         Revolving Credit Commitment Fees) and other amounts, if any, accrued to
         the effective date of this Waiver and Amendment and a waiver fee as
         agreed to between the Company and the Agent and (b) to the Agent for
         the account of its counsel all accrued and unpaid legal fees.

         This Waiver and Amendment is limited to the specific matters described
above and shall not be deemed to be a waiver or consent to any other failure to
comply with any provision of the Credit Agreement or any other Loan Document, or
to amend or alter in any respect the term and conditions of the Credit Agreement
(including without limitation all conditions and requirements for Advances and
any financial covenants), the Notes or any of the other Loan Documents, or to
constitute a waiver or release by of the Banks or the Agent of any right,
remedy, Default or Event of Default under the Credit Agreement or any other Loan
Documents, except as specifically set forth above. Furthermore, this Waiver and
Amendment shall not affect in any manner whatsoever any rights or remedies of
the Banks with respect to any other non-compliance by the Company with the
Credit Agreement or the other Loan Documents whether in the nature of a Default
or an Event of Default, and whether now in existence or subsequently arising.

                                      * * *
                      SIGNATURES FOLLOW ON SUCCEEDING PAGES

<PAGE>   9

James G. Steckart
President and CEO
Home Choice Holdings, Inc.
August 17, 1998
Page 9






         By signing and returning a counterpart of this letter to the Agent, the
Company acknowledges its acceptance of the terms of this letter.


                                           Very truly yours,

                                           COMERICA BANK, as Agent


                                           By:
                                           Its:
                                               ---------------------------------


Acknowledged and Accepted
as of           , 1998:
     -----------

HOME CHOICE HOLDINGS, INC.

By:
   ------------------------------
Its:
    -----------------------------

RTO OPERATING, INC.

By:
   ------------------------------
Its:
    -----------------------------

RTO HOLDING CO., INC.

By:
   ------------------------------
Its:
    -----------------------------

ATRO, INC.

By:
   ------------------------------
Its:
    -----------------------------


ACTION RENT-TO-OWN HOLDINGS OF SOUTH
CAROLINA, INC.

By:
   ------------------------------
Its:
    -----------------------------




<PAGE>   10

James G. Steckart
President and CEO
Home Choice Holdings, Inc.
August 17, 1998
Page 10





                      AUTHORIZATION OF WAIVER AND AMENDMENT

The undersigned Bank hereby consents to the waiver of Sections 8.10, 8.11, and
8.12A of the Credit Agreement, and to the amendments of the Credit Agreement set
forth herein, all on the terms and conditions set forth above, and authorizes
the Agent to issue the foregoing Waiver and Amendment to the Company.



<PAGE>   11

James G. Steckart
President and CEO
Home Choice Holdings, Inc.
August 17, 1998
Page 11



                                  ATTACHMENT I

                                  SCHEDULE 1.1

                            APPLICABLE FEE PERCENTAGE
                            AND EUROCURRENCY MARGINS

<TABLE>
<CAPTION>


===============================================================================
    BASIS FOR PRICING             LEVEL I                LEVEL II              
===============================================================================
<S>                         <C>                     <C>                        
  Fixed Charge                                      greater than or equal      
                                                    to 2.8 : 1                 
  Coverage Ratio            greater than or equal           but                
                            to 4.0 : 1.0                                       
                                                    less than 4.0 : 1          
-------------------------------------------------------------------------------
      Commitment Fee               0.30%                  0.375%               

-------------------------------------------------------------------------------
   Eurocurrency Margin             1.10%                  1.25%                
-------------------------------------------------------------------------------
   Letter of Credit Fee            1.10%                  1.25%                
===============================================================================

<CAPTION>

=====================================================================================
    BASIS FOR PRICING                  LEVEL III                        LEVEL IV     
=====================================================================================
<S>                                <C>                                <C>            
  Fixed Charge                      greater than                    greater than 
  Coverage Ratio                 or equal to 2.25 : 1            or equal to 1.75:1  
                                         but                             but
                                   less than 2.8 : 1                less than 2.25
-------------------------------------------------------------------------------------
      Commitment Fee                     0.425%                         0.50%       

-------------------------------------------------------------------------------------
   Eurocurrency Margin                   1.40%                          1.65%       
-------------------------------------------------------------------------------------
   Letter of Credit Fee                  1.40%                          1.65%       
=====================================================================================
</TABLE>