One of the Country’s largest “Buy Here, Pay Here” dealerships is now in Pittsburgh, Pennsylvania. DriveTime Automotive Group, Inc., better known simply as DriveTime, is a used car dealerships that almost guarantees to finance anyone who walks in the door. Much like JD Byrider, who has been selling cars in Pittsburgh for years, DriveTime caters to lower income families by offering them financing agreements for used cars when no other reputable dealership will do the same. We predict that we will see the same legal issues from DriveTime that we see from JD Byrider.
The “Buy Here, Pay Here” finance opportunity is just shy of a subprime lender. Often times, loans are give to individuals who can barely afford to make the payments with the hope that the buyer will default on the loan. That allows the car dealership to legally repossess the cars, clean them up, and resell them to new buyers while keeping all of the money from the first buyers. This means huge profits for the dealership who may be able to turn over a car again and again.
These car dealerships are also known for harassing phone calls if the buyer misses even one payment. In 2014, the Consumer Finance Protection Bureau fined DriveTime $8 million for harassing phone calls. It becomes an endless cycle that only benefits the dealership: A person receives financing for a used vehicle with a huge interest rate. That individual misses a payment and the phone calls start coming from the dealership’s in house finance company (DriveTime’s is DT Acceptance Corporation). Eventually, the dealership repossess the vehicle, killing the individual’s credit even more. The dealership then turns the car around and sells it to another person.
Because these “Buy Here, Pay Here” dealerships are so focused on making as much money from each car as possible, they often sell junkie cars leading to potential claims of auto fraud. The best place to find cheap cars is an auto auction. Everyone knows that auto auction cars are there for a reason, there is something wrong with them. Getting the car for a cheap price at the auction allows the dealership to sell the car to the consumer for a huge profit. However, if you start to experience issues with your used car, there may be something wrong that the law requires the dealership to disclose before selling it to you.
If you recently purchased a car from DriveTime, and you are having trouble with it, give us a call. You may have repossession problems, auto fraud problems, or more. Call us at 412-348-8600.