Consumer complaint received 2024-08-22
Product: Vehicle loan or lease — Loan
Issue: Repossession — Loan balance remaining after the vehicle is repossessed and sold
Company: CREDIT ACCEPTANCE CORPORATION (MD)

XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX, Maryland XXXX XXXX XXXX Date : XX/XX/XXXX Consumer Financial Protection Bureau XXXX XXXX XXXX Washington, XXXX XXXX Subject : XXXX XXXX XXXX XXXX and XXXX XXXX To Whom It May Concern, I am writing to file a formal complaint against Credit Acceptance and XXXX XXXX regarding a deceptive loan agreement and the subsequent mishandling of my account. Below, I detail the issues I have encountered, including specific violations of consumer protection laws : Account Information : Credit Acceptance Account Number : XXXX Name on Account : XXXX XXXX XXXX XXXX Vehicle Purchased : XXXX XXXX XXXX VIN Number : XXXX Phone Number : XXXX Dealership Information XXXX XXXX XXXX Address : XXXX XXXX XXXX, XXXX, VA XXXX Phone Number : XXXX Description of the Complaint : Bait and Switch Tactics : I purchased a vehicle from XXXX XXXX on XX/XX/XXXX, which was advertised at {$6400.00}. However, the final contract amount was significantly higher. This may constitute a violation of the Virginia Consumer Protection Act ( VCPA ), specifically 59.1-200, which prohibits deceptive practices and misrepresentation in consumer transactions. 

Deceptive Practices and Misrepresentation : I obtained a {$3000.00} loan from my mother for the down payment, assuming the total cost was within my budget. After my XXXX XXXX XXXXXXXX in XX/XX/XXXX, I discovered from Credit Acceptance that the payoff amount was over {$10000.00}, contrary to my initial understanding. This may violate the Truth in Lending Act ( TILA ) ( 15 U.S.C. 1601 et seq. ), which requires clear and accurate disclosure of loan terms and conditions. 

Contradictory Information : XXXX from XXXX XXXX informed me that Credit Acceptance altered my contract and added fees. XXXX XXXX claimed to have received {$5000.00}, not {$10000.00}, from Credit Acceptance, creating a conflict with the information I was provided. This may involve violations of the Federal Trade Commission Act ( FTC Act ) ( 15 U.S.C. 45 ), which prohibits unfair or deceptive acts or practices in commerce. 

Negligence and Additional Issues : Despite complaints to the Attorney General, XXXX XXXX XXXXXXXX XXXX, and FTC, I have not received relief. The vehicle had major issues, including a faulty radiator, which I had to repair at my own expense. Due to these issues and financial strain, I could not maintain the vehicle, leading to its repossession by Credit Acceptance. This lack of resolution could also violate the Fair Credit Reporting Act ( FCRA ) ( 15 U.S.C. 1681 et seq. ), which mandates accurate and fair reporting of credit information.

Credit Reporting and Housing Impact : Credit Acceptance reported a {$12000.00} balance on my credit report, leading to multiple rental denials and contributing to my homelessness. I am using a Military XXXX voucher through HUD for relocation but have been denied three times for rental applications. The failure to send a required deficiency notice after repossession may be a violation of Virginia Code 8.01-29, which mandates that creditors provide such a notice. 

Impact on My Life : The financial hardship and stress from this situation have been extreme. I have missed legal deadlines for seeking counsel due to my inability to work or obtain transportation. Additionally, I sought mental health treatment in XX/XX/XXXX through the Department of Veterans Affairs due to exacerbated issues. I am also a XXXXXXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXXXXXX who depends on me, and the ongoing stress and instability have significantly impacted both our lives. 

XXXX. Dispute with Credit Acceptance and Refusal to Investigate Upon discovering discrepancies in my loan account with Credit Acceptance, I promptly disputed the inaccuracies with the company. Despite my efforts to address these issues, Credit Acceptance refused to investigate or resolve the discrepancies. This failure to act constitutes a violation of federal regulations regarding dispute resolution and accurate credit reporting. 

XXXX. Violation of the Fair Credit Reporting Act ( FCRA ) Obligation to Investigate Disputes : Under the FCRA, Credit Acceptance is required to conduct a reasonable investigation when a consumer disputes information on their credit report. The companys refusal to investigate my dispute violates this requirement. 
15 U.S.C. 1681i : This section mandates that when a consumer disputes the accuracy of information on their credit report, the credit reporting agency or furnisher must investigate and correct any inaccuracies. 
XXXX. Violation of the Fair Credit Reporting Act ( FCRA ) - Accuracy of Information Accuracy and Fairness : The FCRA requires that credit information be accurate and fairly reported. By refusing to investigate and correct the disputed discrepancies, Credit Acceptance failed to comply with this obligation.

15 U.S.C. 1681e ( b ) : This provision requires that credit information be accurate and complete, which includes responding appropriately to disputes and correcting inaccuracies. 
XXXX. Violation of the Consumer Financial Protection Act ( XXXX ) Consumer Rights Protection : The CFPA, which is enforced by the Consumer Financial Protection Bureau ( CFPB ), protects consumers from unfair or deceptive practices, including the mishandling of disputes. 
XXXX XXXX. XXXX : Prohibits unfair, deceptive, or abusive acts or practices, including failing to address valid disputes related to credit reporting. 
Additional Statutes and Regulations : **1. Federal Trade Commission Act ( FTC Act ) Prohibition on Unfair or Deceptive Practices : The FTC Act prohibits unfair or deceptive acts or practices in commerce ( 15 U.S.C. 45 ). If a lender knowingly enforces a fraudulent contract, they could be in violation of this law.

**2. Truth in Lending Act ( TILA ) Transparency and Accuracy in Lending : Under the TILA ( 15 U.S.C. 1601-1667f ), creditors are required to provide clear and accurate disclosures of the terms and costs of a loan. If a contract was entered into fraudulently, the lender may have failed to comply with these requirements, which could render the contract voidable.

**3. Fair Credit Reporting Act ( FCRA ) Obligation to Correct Errors : The FCRA ( 15 U.S.C. 1681 ) mandates that lenders report accurate information to credit reporting agencies. If a lender continues to report adverse information based on a fraudulent contract, they could be in violation of the FCRA. The FCRA also requires lenders to correct inaccurate or incomplete information when notified of a dispute by the consumer. 
XXXX4. Uniform Commercial Code ( UCC ) Good Faith and Fair Dealing : Under the UCC, which governs commercial transactions in the U.S., all parties to a contract are required to act in good faith ( UCC 1-304 ). Enforcing a fraudulent contract would be a violation of this obligation. The UCC also allows for the rescission of a contract that was entered into under fraud.

**5. State Consumer Protection Laws State-Specific Regulations : Most states have their own consumer protection laws that are often modeled after federal laws like the FTC Act and TILA. These laws prohibit fraudulent, deceptive, or unfair business practices and may allow consumers to seek damages or rescission of a fraudulent contract.

**6. Fair Debt Collection Practices Act ( FDCPA ) Protection from Harassment : If a lender or a debt collector attempts to enforce a fraudulent contract through collection efforts, they could be in violation of the FDCPA ( 15 U.S.C. 1692 ). This law prohibits debt collectors from using unfair, deceptive, or abusive practices in the collection of debts.

**7. Restitution and Rescission Contract Law Principles : Under common law principles of contract law, a contract that was formed through fraud is generally considered voidable. This means the defrauded party can choose to rescind the contract and seek restitution for any losses. Courts may also require the return of any money or property exchanged under the fraudulent agreement.

**8. State Fraud Statutes Fraud and Misrepresentation Laws : Each state has its own statutes that address fraud, often providing remedies for victims. These laws typically allow for rescission of the contract, compensatory damages, and in some cases, punitive damages. 
**9. Equal Credit Opportunity Act ( ECOA ) Non-Discrimination in Credit : While this law primarily focuses on preventing discrimination in lending, it also requires lenders to treat borrowers fairly. Enforcing a fraudulent contract could be viewed as a violation of the borrowers rights under ECOA ( 15 U.S.C. 1691 ).

**10. Federal Deposit Insurance Corporation ( FDIC ) and Office of the Comptroller of the Currency ( OCC ) Regulations Bank and Lender Oversight : Federal banking regulations require institutions to adhere to safe and sound banking practices, which include ethical and legal lending practices. If a lender is federally regulated, failure to address fraudulent agreements could lead to enforcement actions by these agencies. 
XXXX*11. State Attorney General Investigations Enforcement Actions : State Attorneys General often have broad authority to investigate and prosecute consumer fraud. They can take action against lenders who engage in unfair or deceptive practices, including enforcing fraudulent agreements.

**12. Breach of Fiduciary Duty In some cases, if a lender has a fiduciary duty to the borrower ( e.g., in a mortgage or auto loan situation where the lender is required to act in the borrower 's best interest ), enforcing a fraudulent agreement could be considered a breach of that duty.

Remedies for Consumers : Rescission : Allows the consumer to void the contract and return to the status quo.

Damages : Consumers may be entitled to compensatory, statutory, or punitive damages depending on the circumstances.

Attorney 's Fees : Some statutes allow the consumer to recover attorneys fees from the lender if successful in proving the fraud. 
If a lender knowingly enforces a fraudulent contract, they could face legal actions from consumers, regulatory agencies, or even criminal prosecution, depending on the nature and severity of the fraud. 

Desired Resolution : I am seeking the following resolutions : Correction of the contract terms and removal of unjust fees. 
Accurate reporting of my account status to credit bureaus. 
Compensation for financial and emotional distress, including assistance in securing stable housing. 
Removal of negative reporting from XXXX, XXXX, and XXXX related to this account. 
I hope the CFPB can assist in addressing these concerns and ensure that Credit Acceptance and XXXX XXXX comply with consumer protection laws. 

Thank you for your attention to this matter. I look forward to your assistance in resolving these issues. 

Sincerely, XXXX XXXX XXXX XXXX References to Legal Violations : Virginia Consumer Protection Act ( VCPA ) Va. Code Ann . 59.1-200 : Prohibits deceptive acts and practices in consumer transactions. 
Truth in Lending Act ( TILA ) 15 U.S.C. 1601 et seq. : Requires clear disclosure of credit terms and costs.

Federal Trade Commission Act ( FTC Act ) 15 U.S.C. 45 : Prohibits unfair or deceptive acts or practices.

Fair Credit Reporting Act ( FCRA ) 15 U.S.C. 1681 et seq. : Ensures accurate and fair reporting of credit information.

Virginia Code 8.01-29 Requires a deficiency notice after repossession.