Memories of a 20-year-old subprime auto case

When researching for a current case, I found a Chicago Tribune article from 1997 about a case I was working on back then concerning finance charges hidden in the price of subprime auto contracts.  Subsequent court decisions has made this type of case much harder to bring, but the practice still continues at dealerships across the country.  You shouldn't be charged a higher price for merchandise when purchased on credit than cash buyers - or if you are, the credit premium should be disclosed as a finance charge.

Be on the lookout for car dealers that have a separate inventory just for buyers with problem credit.  The reason this inventory is separate is the prices are much higher, and the reason the prices are higher is to get around statutory interest rate caps.  Because it is hard to bring these cases successfully, your only remedy may be to not get into the deal in the first place.  A contract to buy these cars at inflated prices can plunge you into debt that you can't get out of and choke the financial life out of you.

Beware, the minute you come inside a dealership that advertises it can help you with your credit, you will be targeted by professionals who know how to take your money.  If you pay three times what a vehicle is worth, for the entire contract period you are really depending upon that vehicle being trouble-free. All too often the vehicle konks out, and you will have to swallow all the negative equity. Often this is too much, and bankruptcy is the unavoidable result.