The business model for many “Buy Here Pay Here” Car Dealerships is questionable at best. Often times we find that these car dealerships own their own finance companies under a different name and provide the financing for many transactions. The car dealerships usually charge a large down payment and then stick consumers with loans that are nearly impossible to pay. For instance, we recently came across a case where our client paid $4,000 down for a car and then was required to pay $400 per month which included a 24% interest rate. These car dealerships lock consumers into these impossible loans and then repossess the car immediately upon the first late payment or default and proceed to sell the car again to another consumer at the same terms. We have found car dealerships will resell the same car as many times as possible only repossess the car a few months after collecting the down payment. Reselling the same car over and over again at these exorbitant prices and terms seems like it should be illegal. The result of such practices is that consumer get ripped off and these car dealerships are incentive to sell cars at extremely high interest rates to ensure default. Moreover, the car dealership is incentive to sell cars that don't work well so the consumer will walk away once the mechanic bills add up and the car dealership can repossess the car and sell it again. We recently came across a case where a car dealership and finance company went a step further. The consumer voluntarily turned the car in due to mechanical issues and within 48 hours the consumer received a letter from the finance company stating that they had a deficiency of $10,000 owed to the finance company. The finance company in question didn't give any of the proper notices regarding the resale of the car and thus were not allowed to attempt to collect such a large deficiency. This particular car dealership and finance company took this shady business model to the next level. They sell broken down cars at high prices and impossible terms, then repossess the cars upon the first missed payment, resell the car at similar terms to the next buyer, and try to collect large, made up deficiencies from the past buyers that defaulted. This is a business model built around corruption and greed and there can be no justification for allowing lenders to take advantage of consumer in this way. This type of business model ensures that consumers will never gain upward mobility in their economic standing because they will always have bad credit and will never be able to borrow money for a mortgage or car payment at a rate that is affordable. The system is truly broken. But, if you find yourself in a similar situation call us and we may be able to help.