Earlier today, the Justice Dept. and the Consumer Financial Protection Bureau announced the largest auto loan discrimination settlement in U.S. history with the news that Ally Bank has agreed to pay $98 million, including $80 million in refunds to settle allegations that it has been charging higher interest rates to minority borrowers of car loans. [More]
Most people know that having a less-than-perfect credit score makes it more difficult to get a loan. And for those who can manage to be approved for a loan or new credit card, it also means they will end up with higher payments. [More]
Jennifer took out a car loan from Regions bank way back in 2005, and paid it off in 2009. She never received the title, but that wasn’t an urgent matter until she was ready to get a new car, and sell or trade in her old one. Then she kind of needed the title. Thanks to the stunning incompetence of everyone at the branch where she originally took out the loan, this process somehow took six months. [More]
A man in Chicago has filed a lawsuit against the company that serviced his car loan for allegedly ruining his marriage by revealing, via a voice mail, that another woman was making loan payments for him. [More]
Every day, people in America get married. Some of them change their last names. Evidently, though, no one in the history of Chase Bank has ever done this while they were in the middle of paying off their car loan. See, until the loan is paid, the bank has a lien on your car’s title. If you want to change the name on your car title and the loan hasn’t been paid off yet, Chase won’t let that happen. This isn’t a problem unless you have to move and register your car in a different state after your name change but before the car is paid off. That’s what happened to Michael’s wife, and how she ended up in a loop of bureaucracy sending them back and forth from Chase to the Maryland Vehicle Administration. [More]
Even though you’ve traded in your old car, made a down payment on your new one and driven it off the lot, make sure you are 100% sure that any financing you have on your vehicle is complete. If it’s not, you might soon find yourself out your down payment and without your new wheels — or even the car you traded in. [More]
People trying to get ahead on their car and house payments are sometimes shocked to discover the default way that banks handle their extra payments. Instead of paying down the existing principal, they apply it to the future interest. Not only that, but you can’t just call them up one time and ask for them to change how they handle your payments. You need to call them every month you make a payment. Here’s a tale from reader Katherine: [More]
Tom is angry at Wells Fargo, because they’re borrowing $377.09 from him without his permission. When Wells Fargo purchased Wachovia a few years ago, Tom’s car loan came along with it. Every month, the bank would draft a payment of $384.43 from Tom’s account. His last payment was due in March, and it was only $6.34, but Wells Fargo just went ahead and took the entire $384.43 out of habit. [More]
If you want to pay down the principal on your Chase car loan by adding a little extra to your payment when you pay online…well, don’t bother. Sean discovered that paying a little extra on your auto loan isn’t so simple. Any extra money you might send is considered an early payment for next month…not applied to the principal. Sneaky. [More]
Richard bought a vehicle, returned it and bought another from the same dealership. He says Wachovia erroneously paid off the second loan instead of the first. Once he got the finance department to correct the mistake — a process that took a month — Wachovia started hassling him to make a payment for which he was never billed. [More]
Repossessing cars is so old-fashioned. All that driving, locating people’s houses, towing the cars away… with the mess credit markets are currently in, who has time for that? Car lenders don’t.
Toyota, long resistant to the sort of interest-free financing deals that their domestic counterparts survive on, is offering 0% interest financing on 11 of their vehicles, including Corolla and Camry, the Tundra full-size pickup truck, Matrix; RAV4, Highlander, FJ Cruiser, 4Runner and Sequoia SUVs; Sienna minivan; and Tacoma pickup truck.
In an effort to spur sales, General Motors is offering no-interest, six-year loans on new vehicle purchases through June 30th. Unfortunately, only the slow-selling models (i.e., not very fuel efficient) are included in the sale. Oh, also they’re raising prices on 2009 models. [New York Times]
Gone are the days of the three-year car loan. The length of the average automobile loan hit five years, four months in October, up more than six months from 2002, according to the Federal Reserve. And nearly 45% of loans written today are for longer than six years. Even some staid lenders owned by the carmakers, such as Toyota Financial Services and Ford Credit, are offering seven-year financing. And a few credit unions, particularly in the West, are tinkering with the eight-year note.
The ongoing subprime meltdown is merely the first destructive wave of credit catastrophe to wash over Wall Street, according to Slate’s resident explainer. Americans drunkenly bandy credit around in several forms: mortgages are the most prevalent loans turning sour, but credit card debt, student loans, and auto loans are silently conspiring to threaten our macroeconomic well-being.