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Avoid Auto Loan Modification Scams

Companies advertising auto loan modifications are offering nothing more than a way to separate borrowers with damaged credit from their money
Avoid Auto Loan Modification Scams
Our experience

When it comes to auto loan modifications, it’s our opinion that most consumers with problem credit will get taken for a ride.

Here at Auto Credit Express we base this on that fact that for twenty years we’ve been helping car buyers with poor credit searching for online car loans find those dealers that can afford them their best opportunities for car loan approvals. And during all that time none of these dealers offers an auto loan modification program because there just aren’t that many lenders doing this.

So why are these offers out there and so visible?

According to an article from the Federal Trade Commission there are scammers out there advertising programs such as this to attract people who are having difficulty making their car payments.

Auto loan modification scams

In general the companies these scammers represent will make some or all of the following claims:

• They have close relationships with consumer lenders
• They can significantly lower your monthly car loan or lease payment
• They can help you avoid repossession
• If they can’t make a deal for you, they’ll refund your money

According to the FTC (which has sued a number of these companies) the promised loan modifications were never done, borrowers never received refunds and, in many cases, lenders were never even contacted by the loan modification companies.

Scam experiences

The victims of these scams shared much in common:

• After paying a fee for the promise of a loan modification, nothing was done as promised
• The scammers often added to the problem by telling clients to stop making car payments while they were in negotiations with lenders
• Some learned that nothing was being done only after being told by their lender that their vehicle was about to be repossessed
• In some cases scammers demanded additional fees to continue working on a client’s case

FTC recommendations

If you find yourself falling behind on your car payments, the Federal Trade Commission has these suggestions:

• Contact your lender directly to discuss your options as early as you can
• The longer you wait to call, the fewer options you will have
• Typical auto loan modifications involve deferring missed payments to the end of the loan or extending the term to reduce payments
• Any loan modification will also increase the amount of interest you’ll pay
• Creditors will rarely reduce the amount of the principal or the interest rate for an auto loan modification

Reporting fraud

If you’ve been taken for a ride by an auto loan modification scam you should file a complaint with the Federal Trade Commission at ftc.gov or by calling their toll-free number at 1-877-FTC-HELP (1-877-382-4357). You should also contact your state Attorney General.

The Bottom Line

Consumers having trouble making payments on a high-risk auto loan or any loan, contact the lender as soon as possible. As for auto loan modification programs, it’s always important to remember that if something sounds too good to be true, it probably is.

One more thing to remember: Auto Credit Express matches people with bad credit to those  dealers that can offer them their best opportunities for approved car loans.

So if you’re ready to reestablish your car credit, you can begin now by filling out our online car loan application.

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