Tag Archives: FTC

Top 5 Consumer Complaints of 2011

We’ve all had that moment as consumers. That one phone call that just enrages us to such a degree that we have to tell someone about it. Sometimes it’s just telling a friend or significant other and just getting it off your chest. Other times, it’s more serious than that and that threat you made to the representative to report them to the Better Business Bureau seems like something you should do. Everyone has their tipping point before they finally do make a phone call to formally report a company. In 2011, the Federal Trade Commission received more than 1.8 million complaints from consumers. This is a mark increase from 2010, a 24% increase in fact. It’s also the fifth straight year that the number of complaints increased.

Fox Business put together a list of just what people are lodging complaints about. They broke it down to the top five offenders.

#1 – Identity Theft

This complaint has been on the top of the complaint list for the 12th year in the a row. It accounts for 15% of complaints and a quarter of those were related to tax or wage related fraud. What this kind of fraud is is when your Social Security number or other personal information is stolen and used to get a job. That holds you liable for any tax obligations from the thief’s employment. They also file a tax return in the victim’s name and then walk off with the tax refund. Make sure to protect yourself against this threat by guarding your Social Security number and monitoring your bank statements and credit reports.

#2 – Debt Collection

Debt collector has been an ugly word for some time now and there’s a good reason. The daily news cycle for the past many years seems to always have a section dedicated to some caller finding new and immoral ways of harassment as a means to collect on debt. No other industry receives more complaints from people than debt collectors according to David Torok, the director of the division of panning and information at the Federal Trade Commission. 2011 saw 180,928 complaints, or 1 in ever 10 complaints made. Torok also provides some advice with dealing with the nasty kinds of debt collectors. “Collectors can’t harass. That’s the simple bottom line. Know your rights.”

#3 – Banks and Lending

Definitely not a hard one to see given the state of the economy. The bailout hasn’t left anyone news cycle, nor has the predatory mortgage loan fiasco. That and there was this whole messy business with crashing the world economy. In this regard, the banks are receiving such complaints due to problems with customer service and problems with modifying their mortgage terms.

#4 – Auto-Related

The majority of complaints that are against dealerships come from the sales of new and used cars. In fact, 2 out of 5 auto complaints were over new-car sales. The issues that were most complained about were car rentals, parts & repair, and services. The recommendations to avoid running into these problems when going into the dealership is all about research. Know the car you’re purchasing so you can go into the negotiation process armed with the proper information.

#5 – Advance-Fee Loans

44,020 complaints were filed against advance-fee loans. What happens is that the promise of a loan or a credit card is held up in front of a consumer and requires a payment up front in advance. What usually happens is that the person offering the loan takes that fee and runs away, leaving the consumer with less money and no prospect for a loan. A good red-flag of this is if the lender is looking for just personal information such as a Social Security number or bank account number and doesn’t show interest in your credit history. Also, be weary of any offer made over the phone that requires you to pay in advance. Make sure to do some homework on a business before dealing with them to help avoid this issue.

There’s certainly a lot of people out there trying to pull the wool over the eyes of consumers. I feel that the number of complaints on the rise show that people are really starting to show they understand their rights and just what to do when they feel wronged by a company.

Approved Loan Store has a great history of working with customer to make sure they drive away satisfied. Just check out our testimonial page to see over a hundred happy customers that show our commitment to being professional with all our customers. Fill out an application to start the process and find out for yourself to get that car you’ve always wanted. You’ll find us on Facebook and Twitter, make sure to like us and follow us to stay current on the news coming out of the industry.

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Don’t Be a Yo-Yo: Avoiding the Latest Auto Scam

You go into a dealership and they set you up with car that you want. You sit down with the man in charge of finances and he gets you set up with a great deal. Everything is looking great and the dealership even lets you drive home with car even though the sale hasn’t been finalized. You get home and can’t help but smile at your good fortune. The house of cards doesn’t crumble until the next day, when the dealership calls to have you come back in. Suddenly the financing that you were offered has fallen through and now you’re being asked to sign a new deal with a higher interest rate or a much higher required down payment.

This dilemma has a name, and it’s one that has consumer groups asking the FTC to do something about it. It’s referred to as a “yo-yo scam.” The NY Times has an article on this very thing where they define the scam as where the salesperson “pulls the consumer back to the dealer, like a yo-yo on a string.”

Christopher Kukla, Center for Responsible Lending’s senior counsel for government affairs, says the the dealers will do this scam because once a consumer takes home the car, they believe the deal to be done. That means they aren’t in the market anymore, not researching for better loans at other dealerships. If the buyer refuses to the new agreement, they hit a road block on getting the down-payment back or their trade-in returned. Typically the trade-in has already been sold. The ones that are targeted by this scam are usually suffering from low incomes and bad credit.

The advocacy groups are asking that the FTC step in to put an end to this practice. They believe that it gives dealers an unfair upper hand in negotiations. The National Automobile Dealers Association has dismissed the claim however, saying that the practice is not prevalent. We here at Approved Loan Store would like to hear your thoughts on the matter. Have you ever been a victim of the yo-yo scam?

Approved Loan Store helps people with bad credit find the car they want. We are not in the business of deception, we pride ourselves on being honest with customers. Don’t take our word for it, we have over a hundred people providing testimonials on the quality of our business. Fill out the application, we would like to work with you. Like us on Facebook to see all the latest industry trends and be sure to also follow us on Twitter.

Fraudulent Car Loan Companies Charged by FTC

Scam artists are always looking for new ways to pull the wool over people’s eyes. One such case is a new fraud scheme that’s targeting car owners who are having troubles with car loans. It’s very similar to a scheme that was running rampant during the peak of the housing crisis where a company would offer assistance to struggling homeowners in securing a modification on their loan. They would collect up front fees from the unknowing victim and run with the money.

An article posted on the Huffington Post shows that the FTC is starting to target these fraud companies. The agency has filed charges with two California companies. The charges allege that the companies, Hope for Car Owners and Auto Debt Consulting, have been tricking troubled car owners with problematic practices. They charged up front fees on service they did not provide, refused to give any refunds, all of which went against the services they advertised and even guaranteed. These charges represent the first case the FTC has brought against companies that offer car loan modifications.

Businesses like this are what give loan modification companies such a bad name. It never ceases to amaze me just what people do to take advantage of those who are desperate for help in hard financial times. Many people are just starting to get back on the right track of paying back car loans with a rebounding economy. The last thing they need is someone looking to steal their hard earned cash. To make sure the decisions you make when times are rough, the FTC has a page dealing with auto loan scams worth checking out.

Be assured that Approved Loan Store is one of the legitimate companies looking to help you drive away in the car you want. We love working with people with bad credit. Go online and fill out an application to see how the process works for yourself. Also make sure to like us on Facebook and follow us on Twitter to see the latest in news and trends from the auto industry.

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