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FTC charges two companies Scam California Auto loan.
Car owners beware launched a new scam in which fraudsters they offer to help car owners in difficulty redoing the conditions of their car loans, to take your money and run.
His familiar A similar fraud arose a few years ago at the height of the housing crisis that owners fought to avoid foreclosure, all kinds of sketchy companies seemed to offer help in getting a loan modification the companies collected upfront fees without delivering the promised aid.
This same type of fraud is now trying to invade the auto loan market, said Malini Mithal, associate director of the division of financial practices at the Federal Trade Commission Wednesday, the agency has filed charges against two companies of California allegedly duped car owners taken in the shed hundreds of dollars are the first cases that the FTC has brought against companies that offer car loan modifications.
We're concerned about mobile scammers mortgage arena in the automotive arena, Mithal said in an interview with The Huffington Post Now that the FTC rules against advertising companies mortgage modification and debt relief services , auto loans is an area of unhedged debt by our rules.
The FTC alleges that two companies - Hope for car owners and board of Auto Debt - engaged in a variety of problematic practices Not only do they charge upfront fees for the services they provided, they also refused to provide refunds to customers, despite reimbursement of advertising and guaranteed services, the agency said.
In other cases, companies have provided advice that led to the client`s lose the car - the exact scenario that the person intended to avoid by hiring the company, said Mithal.
Instead of paying their lenders, these car owners paid these companies, though some of them have ended up having their cars repossessed, said Mithal Some car owners have been told by companies to hide their cars to avoid possession, she said.
Hope for car owners could not be reached for comment.
Naythem NAFSO, founder of the Motor Consulting debt, denied the accusations Our services are quite exceptional, he said in an interview with The Huffington Post We help absolutely and help customers struggling with car payments and if we do not succeed we emit either a partial or full refund depending on the amount of work we have done so.
Buying a car is the second most expensive financial transaction that the consumer will make after buying a home, said Mithal, who said that his agency is increasingly interested in the automotive market.
As for car loans, Americans need a total of 730 billion dollars, more than the amount of credit card debt in the country, which is 693 billion, according to the Federal Reserve Bank of New York.
In 2009, the number of times of car ownership peaked at 1 9 million, according to Manheim Board Although this figure has since dropped to 1 3 million, Manheim provides that it will increase again after a increase in auto loans and some easing of credit standards by creating greater opportunities for fraudsters to try to defraud consumers.
Hope for car owners typically charged 200 to 500 before to get the elusive loan modification that allegedly reduce payments by the borrower as much as half of the Auto-board debt charge more - 350-799 - for changes loans that could reduce alleged payments by an even smaller amount - 25 percent to 40 percent, according to the FTC.
The FTC has asked a U S District Court to order the companies to stop functioning while the agency continues both.
For more information on fraudulent car loan scams and suggestions on how to negotiate with your lender if you are having trouble making car payments, visit the FTC on auto loan scams that includes also advice on what to do if your car has been repossessed.
FTC charges two companies California Auto Loan Scam The Huffington Post, charges, California businesses.