Auto Lender Credit Acceptance Corp sued by NY AG Letitia James and CFPB

New York Attorney General Letitia James and the Consumer Financial Protection Bureau, CFPB sued Credit Acceptance Corporation, CAC, one of the nation’s largest subprime auto lenders, for deceiving thousands of low-income New Yorkers into high-interest car loans. The lawsuit alleges that CAC pushed unaffordable loans onto tens of thousands of low-income consumers throughout the state without considering their ability to repay their loans in full. CAC misstated key terms on loan agreements, including the principal and interest amounts, and did not disclose thousands of dollars in credit charges. In addition, CAC packaged these illegal loans into securities that it sold to investors. These deceptive lending practices lowered consumers’ credit scores and cost New Yorkers millions of dollars. The lawsuit seeks to end CAC’s abusive and deceptive practices, reform or eliminate existing CAC loan agreements, and collect restitution for impacted consumers. "CAC claimed to help low-income New Yorkers purchase cars, but instead, drove them straight into debt," said Attorney General James. "CAC steered hardworking New Yorkers toward financial ruin by tricking them into unaffordable, high-interest auto loans while cutting backroom deals with dealers to protect their own profits. These predatory actions hurt innocent people and left them with mountains of debt. I thank the CFPB for their partnership to stop this harm and protect everyday New Yorkers." Reference Link