Auto Title Loan Litigation
Levy is cocounseling with auto fraud and lemon law attorneys Kemnitzer, Barron & Krieg (“KBK”) to challenge extraordinarily high interest “auto title loans.” Auto title lenders loan money against car titles at astronomical interest rates, often over 100% per year. The loans are fully secured by the borrower’s car, leaving the lender at little or no risk that the loan will not be paid. Lenders limit the amount they lend to make sure they have substantial “equity” for repayment. As a result, most of these loans are essentially risk free to the lenders; they can repossess the car and be made whole and then some. Because the lenders prey on financially desperate borrowers who are often unable to afford the high interest rates, auto title lending frequently comes down to auto “equity stripping” and the loss of critically important family autos. Levy and KBK contend that title lending practices and interest rates violate the California Finance Lenders Law and California’s prohibitions against unconscionable loans.
Levy and KBK have filed title loan challenges against 1-800Loanmart and Wilshire Capital.