Notice: We are still operating during the COVID-19 crisis. However, we are not allowing visitors to our office and most of our staff is operating remotely. Our attorneys and staff are still available to help you by phone and email. If you get our voice mail, please leave a message and it will be returned promptly. There may be delays with mail due to the crisis, so please try to send documents by email after submitting a contact form here or fax to 312-419-0379, if possible.

Massachusetts sues Credit Acceptance Corporation

AG Healey Sues Major Subprime Auto Lender for Unfair and Deceptive Practices in Its Subprime Auto Loan Business in Massachusetts

AG Claims Company Misled Investors, Sold Unfair and Illegally High Interest Loans and Engaged in Illegal Debt Collection Practices

FOR IMMEDIATE RELEASE:

8/31/2020

  • Office of Attorney General Maura Healey

BOSTON — A lawsuit has been filed against national auto lender Credit Acceptance Corporation (CAC) for allegedly making unfair and deceptive auto loans to thousands of Massachusetts consumers, providing investors with false or misleading information regarding auto securities they offered, and engaging in unfair debt collection practices, Attorney General Maura Healey announced today.

The complaint, filed in Suffolk Superior Court, alleges that since 2013, CAC failed to inform investors that the company topped off the pools of loans that they packaged and securitized with higher-risk loans, despite claiming otherwise in disclosures to investors. The complaint also alleges that CAC has made high-interest subprime auto loans to Massachusetts borrowers that the company knew borrowers would be unable to repay, in violation of state law. While the company profited, borrowers experienced ruined credit, lost vehicles or down payments, and were left with an average of approximately $9,000 of debt. Additionally, CAC borrowers were subject to hidden finance charges, which resulted in CAC loans exceeding the usury rate ceiling of 21 percent mandated by state law.

“This company made unaffordable and illegal loans to borrowers, causing them to fall into thousands of dollars of debt and even lose their vehicles,” said AG Healey. “We are taking a close look at this industry and we will not allow companies to profit by violating our laws and exploiting consumers.”

In its lawsuit, the AG’s Office also alleges that the company took excessive and illegal measures to collect debt from defaulted borrowers, including sending faulty notices to borrowers with repossessed vehicles, harassing consumers with unlawfully repetitious collections calls, and overcharging consumers on their deficiencies.

The state is seeking relief for Massachusetts borrowers harmed by these alleged practices, as well as civil penalties and injunctive relief.

Categories: