It is easy to see how auto buyers can be cheated when they are able to get auto financing through Maryland’s auto dealer that charged illegal fees and discriminated against Black customers.

According to a Federal Trade Commission complaint filed Oct. 18, 2022 by the Federal Trade Commission, the dealer also allegedly charged customers hundreds of dollars or more in “junk fees” and imposed higher financing costs on Black and Latino customers.

Key Takeaway: These allegations against the dealer serve as a reminder to protect your rights and understand your options when it involves dealer auto financing.

Protect against unjustified auto loans

Passport Automotive was accused by the FTC of charging excessive fees for certifications, reconditioning, and inspections it claimed were necessary. You might be more susceptible to aggressive or shady selling tactics if you feel pressured, excited or just plain curious about buying a car.

What can you do

  • Be aware of your rights. Dealers cannot sneak additional fees into your deal, or lie about them.
  • Take charge. Before you go to a car lot, explore all financing options. Find out where the best places to get a car loan are for you, especially if your credit is poor. Then shop around for the best deal. Dealership financing may not be the best option.

Report discrimination

Dealers and lenders cannot use the federal Equal Credit Opportunity Act to discriminate against qualified borrowers because they may not be able to offer an auto loan with different terms than they would to a similar borrower.

What can you do

How to get out of a bad loan

Refinancing your car loan may be an option if you are unhappy with your loan. You technically can refinance your car loan at any time, even during the first three months. However, you will need to wait until all paperwork is completed.

What can you do

  • Calculate the numbers. However, before you go this route, be sure to consider the cost. You should check to ensure that your contract does not have a prepayment penalty. This could prove costly. If you are able to get a lower interest rate, refinancing your car loan can help you save money. A loan with a longer repayment term could reduce your monthly payments if you are unable to find a lower interest rate. An auto refinance calculator will help you to figure it all. Be aware that you will likely pay more interest if your payments are spread out.
  • Be careful. Check with your existing lender first to determine if they are willing to refinance the loan. You can also apply for prequalification with different lenders to compare offers and find the best car loan for you.
  • Beware of Auto loan refinancing scams Don’t fall for companies promising to lower your car payment after you have paid them upfront. Scammers will simply take your money and do little to help.