predatory lending on a vehicle?

[Lukek]

Jurisdiction

Missouri

I recently hired a nanny and she is having financial trouble. She purchased a car in February '19, made her first payment and missed the second. The car was repossessed last week. She was originally told that it would be $1400 to get the car back, which, I was willing to help her with now that we have her finances lined out. She was told that she would have 10 days to pay. When we called today (day 5) they said that she couldn't get her car back and that they were selling it at auction. She paid $13k for the car 3 months ago and they are auctioning it off for a 7k value. She was clearly taken advantage of because she knew nothing about cars or getting a loan. Is this predatory lending? Is there anything I can do to help her?

 

[justblue]

I recently hired a nanny and she is having financial trouble. She purchased a car in February '19, made her first payment and missed the second. The car was repossessed last week. She was originally told that it would be $1400 to get the car back, which, I was willing to help her with now that we have her finances lined out. She was told that she would have 10 days to pay. When we called today (day 5) they said that she couldn't get her car back and that they were selling it at auction. She paid $13k for the car 3 months ago and they are auctioning it off for a 7k value. She was clearly taken advantage of because she knew nothing about cars or getting a loan. Is this predatory lending? Is there anything I can do to help her?

Is she mentally challenged in some way that would limit her ability to understand the contract that she signed? Is she incapable of understanding that one must pay their bills or the repo-man comes and takes the shiny car?
If the answer to both these questions is "No", then she was not taken advantage of. If the answer is "Yes", she should not be nanny to your children.
If you feel the Christian need to help her...Buy a decent used car for her to use while at work. Remember to have her listed on the insurance policy.

 

[Lukek]

Is she mentally challenged in some way that would limit her ability to understand the contract that she signed? Is she incapable of understanding that one must pay their bills or the repo-man comes and takes the shiny car?
If the answer to both these questions is "No", then she was not taken advantage of. If the answer is "Yes", she should not be nanny to your children.
If you feel the Christian need to help her...Buy a decent used car for her to use while at work. Remember to have her listed on the insurance policy.

Thanks, I think. I was thrown off by the value of the loan. Seems odd / predatory to grant a loan for almost double the price of a vehicle.
Also seems odd to owe 6k in debt after having a car for 90 days and missing a payment?

 

[justblue]

Thanks, I think. I was thrown off by the value of the loan. Seems odd / predatory to grant a loan for almost double the price of a vehicle.
Also seems odd to owe 6k in debt after having a car for 90 days and missing a payment?

She could take her contract to an Attorney for a review.

I must point out you're an incredibly nice employer!

 

[Lukek]

She could take her contract to an Attorney for a review.

I must point out you're an incredibly nice employer!

I think we will. Thanks for taking the time to respond! Much appreciated.

 

[adjusterjack]

Seems odd / predatory to grant a loan for almost double the price of a vehicle.

That's not what happened. The car is being sold at a wholesale auction so the lender can get as much cash out of it as quickly as possible.

Has nothing to do with what she paid for the car.

 

[zddoodah]

Is this predatory lending?

You've provided no relevant facts, so no one here has any conceivable way of knowing. You claim that "She was clearly taken advantage of," but nothing in your post supports that assertion.

Is there anything I can do to help her?

From a legal standpoint, no. Anything she does will have to be done on her own, but you can offer financial and emotional support, help her find a lawyer, etc.

Seems odd / predatory to grant a loan for almost double the price of a vehicle.

I'm quite confident that the loan was for exactly the price of the car. Auto lenders wouldn't stay in business if they offered loans well in excess of the price of the vehicle. That the lender is now auctioning the vehicle with a starting bid of significantly less than the loan amount is completely irrelevant.

 

[Lukek]

You've provided no relevant facts, so no one here has any conceivable way of knowing. You claim that "She was clearly taken advantage of," but nothing in your post supports that assertion.



From a legal standpoint, no. Anything she does will have to be done on her own, but you can offer financial and emotional support, help her find a lawyer, etc.



I'm quite confident that the loan was for exactly the price of the car. Auto lenders wouldn't stay in business if they offered loans well in excess of the price of the vehicle. That the lender is now auctioning the vehicle with a starting bid of significantly less than the loan amount is completely irrelevant.

I may have misspoken, the car was purchased for 13k, hardly driven (so no real mileage or condition change) and the car bluebooks at 7k. It was obviously a poor purchase decision, but I'm shocked that she was able to get a 13k loan on a car worth only 7k.

 

[Zigner]

I may have misspoken, the car was purchased for 13k, hardly driven (so no real mileage or condition change) and the car bluebooks at 7k. It was obviously a poor purchase decision, but I'm shocked that she was able to get a 13k loan on a car worth only 7k.

Bluebook is but one valuation tool. In any case, since the car sold at the wholesale auction for $7,000, it's obviously worth considerably more at a retail dealership.

 

[justblue]

I may have misspoken, the car was purchased for 13k, hardly driven (so no real mileage or condition change) and the car bluebooks at 7k. It was obviously a poor purchase decision, but I'm shocked that she was able to get a 13k loan on a car worth only 7k.

What was the interest rate?