Getting Yourself Spared With The High Interest Of Auto Financing Companies


“Jane Doe”, a single parent and low-wage earner, who secured financing an auto loan from Credit Acceptance Corporation (CAC). It proved to be a financial mishap for her. Thrilled by the fact that she got the loan without the help of her ex or her family members, Jane didn’t worry about it when the financing company inserted a device on her Ford Focus in order to ensure payments were made on time. Below are 3 reasons signing on the dotted line with this Auto Financing company was a mishap for “Jane Doe”:

high interest auto financing1. After two years of on-time payments, you’re suddenly 18 days late for a payment, and the finance company repossesses your car. After talking with the finance company, customer service gives you an option. Provide three months payment in advance, and provide a $600 security deposit. If “Jane Doe” had a problem getting up the $300 for December’s payment, how could she afford more than $1500 to recover her car? Apparently Credit Acceptance Corporation depends on this. Within 2 months, the company elected to auction off the vehicle. Jane Doe never had the chance to recoup the car.

2. In most cases, companies like this can’t lose on high interest loans because they can always repackage a loan for a used car or auction it off completely.

3. Finally, high interest auto financing companies depend on bad credit borrowers skipping a payment, and the companies waste very little time in repossessing the car and re-selling the car. So do high finance companies prefer to repossess your car?

In some cases, they do. According to, “a company will only take on significant amounts of debt when it believes that return on assets (ROA) will be higher than the interest on the loan.” For example, you are a low-income worker who got an auto loan from a high finance auto financing company. You get in a bind and miss a single payment. The auto loan company takes your car after you’re 18 days late. That’s less than thirty days! That’s what happened to Jane Doe, a low-income person in her 40s.

Try one of these three solutions:

1. Speak directly with the Consumer Litigation Manager of the Auto Financing Company. “Jane Doe” tried this approach. However, the company maintained that it was Credit Acceptance Corporation’s policy to repossess cars within thirty days of a consumer being late.

2. Write the Attorney General of the state in which the business resides. Jane Doe did that. Unfortunately the Attorney General’s office can’t make a judgment and suggests the consumer take the financing company to court.

3. Hire an attorney and go to court.

For assistance with a high interest auto finance company, you may want to contact an attorney.

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