I just put a client together with a reporter doing a story about high interest vehicle loans. I’ll leave the details to him and post here when the story comes out — but I did want to remind folks that there are ways out of these loans.
This particular loan was for 17.45% interest loan. The client made low six figures in income from a very reputable employer at the time. Why such high interest? I’m not sure what her credit score was at the time, but the incredibly high interest rate caused her to pay $58k for a used vehicle she bought at $35k. She made payments for approximately two years, but with a mortgage, and everyday expenses going up, she couldn’t keep it up.
Her solution was to file bankruptcy and surrender the car. This way they couldn’t come after her for the deficiency balance. Other things were addressed in the bankruptcy as well. But this vehicle and the 17.45% interest rate was a leading cause. We assist clients in obtaining other more sustainable vehicles during the bankruptcy – usually with a reasonable interest rate, warranty, sustainable payment. We get that you need a vehicle. You just need one that makes financial sense.