Settlement Includes Restitution for Consumers
Contact: Justin Kolber, Assistant Attorney General, 802-828-3171
Attorney General T.J. Donovan today announced a settlement with Santander Consumer USA, Inc. resolving complaints of unfair or deceptive practices relating to subprime auto loans. The settlement resolves the Attorney General’s claim that Santander Consumer USA’s subprime lending practices violated consumer protection laws by exposing consumers to unnecessarily high levels of risk and knowingly placing these consumers into auto loans that had a high probability of default.
Under the terms of the settlement, Santander Consumer USA will provide relief to eligible consumers by:
- paying $75,000 in restitution to certain subprime consumers who defaulted on loans between January 1, 2010, and December 31, 2019;
- giving consumers with the lowest quality loans — those who defaulted as of December 31, 2019, and who have not yet had their cars repossessed — the titles to their cars and waiving any balance on these consumers’ loans;
- waiving deficiency balances and attempting to buyback deficiency waivers the company no longer owns; and,
- engaging in credit repair for affected consumers.
Consumers who are eligible for relief under the settlement will be contacted by the Attorney General’s Office.
The State of Vermont will also receive a $30,000 payment to resolve the matter.
In the future, Santander Consumer USA will take steps to minimize the risk of consumers defaulting on their loans, including refusing financing to consumers that have no income remaining after considering their monthly debt obligations.
Here are links to the complaint and consent judgment.