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Car repair loans can charge extremely high interest

Loans for cheaper car repairs may not be as good as deals.

Consumer groups are warning about 189% interest rate loans on national car repair chains. A group has sent letters this week to AAMCO, Precision Tune Auto Care, Big O Tires, Midas, Grease Monkey, Jiffy Lube and Meineke.

Stores are being asked to stop offering financing through EasyPay Finance, which manages loans through the Transportation Alliance bank.

Consumer groups were offering high interest rate loans in states with lower interest rate limits.

“Banks are exempt from state interest rate limits,” said Lauren Saunders of the National Consumer Law Center. “So predatory lenders sometimes find a malicious bank and they clean up the loan through the bank and call it a bank loan. A company like EasyPay Finance cannot charge 189% directly in many states, but they are doing so because their loans are bank loans and are exempt from state law. ”

The loans didn’t promise any interest if they were paid in 90 days, but Saunders said a lot of people aren’t able to get that.

“They’re dealing with an expensive car repair,” Saunders said. “They don’t think about loans. They are told to click their hands on a tablet and here or there to do it on the phone and try to read the small print on a small three-inch screen. Make sure you always see the whole contract. ”

If the National Consumer Law Center takes out any of these loans, it is advised to opt out of the mandatory arbitration clause within 60 days. You can also file a complaint with the Office of Consumer Financial Protection or your state’s attorney general.

In response to us, Jiffy Lube said that he has no contact with EasyPay finance or is aware of the franchisees who work with them. The major tire company Midas and Big O said EasyPay Finance is one of the sources of funding that some franchisees choose to make available to their customers.

Banks must be licensed by the Federal Deposit Insurance Corporation.

There is a bill in Congress that would limit interest rates to 36% for all lenders, avoiding such loans in the future.

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Car repair loans can charge extremely high interest Source link Car repair loans can charge extremely high interest

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