Bank: "Hmmm...no money, low income, previously bankrupt...HA! Well, we sure aren't lending you folks money...but we'll make you an offer to stupid no one in the right mind would accept it. Who the hell would take a 25% loan?!"

Bank: "...well I'll be damned."

Seriously, what the fuck are these people doing? There are plenty of $5k reliable cars on Craigslist. Buy a Corolla. Good luck breaking one of them without getting into an accident. Don't borrow money when you don't have a chance of paying it back or you're just asking for a world of pain.

1. im too lazy to read through all of the posts. they signed a contract... they didnt realize the rate was 25%.
2. they finance a car with no money
3. they have every right to ask for a printout of theyre payments
4. theyre retarded
5. theyre stupid
6. dealer and bank should countersue for damages after

They knew the rate was 25%. They thought it would decrease after the first year.

Indeed obvious. Yet also unfortunate. Having sales people discussing loan details and making promises while they should be selling cars. Giving impressions to people that they shouldn't and that are "impossible". Then they enter the business office with that "impossible" impression and read a contract, handed to them from a different person, which states the complete opposite? WTF? That, in itself, is where the trust dies for me.

Of course, anything passed that point is the complete responsibility of the customer. If they don't read that contract and blindly sign it then too bad for them. If they don't realize that someone with tarnished credit can't borrow at prime rates with easier payout options then they do not understand risk.

While any astute person would read the details and ask questions about the contract the general public is dumb and emotional. Car buying is emotional and people get caught up in it. We all chuckle at the Ian and Steve ads but there are tons of people that hear that and think, "holy fuck, I can't get a loan anywhere but these guys will give me a truck, tv, jet ski, and trip to disneyland and I don't gotta pay shit for 6 months!!" Sending that message combined with what I stated above is just a recipe for disaster.

Just my $0.02.

The book is only great for inspiration.

Judging by the intelligence of this couple, they would then get swindled for tens of thousands buying into the 'rich dad poor dad' real estate courses.

In all honesty, managing money is not that hard. It's all common sense. Don't spend more than you have or don't buy shit you don't need. Like, why do they need a $21,000 vehicle when they are broke ass joes?

^ That was what always puzzled me reading Rich dad Poor dad, it seemed like a massive advertisement for real estate investing.

read enough financial books and the majority of them lead to real estate investing... but this isnt really the thread.. and that wasnt the part i was referring to... more so the part about managing finances and reducing liabilities.

looks like they are ALLLLL coming out now looking for some sort of relief...?!


Car buyers say dealerships duped them over TD's costly loans - British Columbia - CBC News


Several dozen Canadians who have high interest car loans from TD have contacted Go Public, claiming they were deceived by dealers into believing the interest charges would be lowered after a year.

“I feel very misled and deceived,” said Ashley Franson, of Pitt Meadows, B.C., who said TD has since refused to give her a lower rate.

Go Public first reported on the high interest auto loans when a B.C. couple came forward to say they felt misled into a 25 per cent interest loan from TD.


The customers are being charged between 15 and 30 per cent interest, over terms as long as eight years, on their subprime car loans.

“I questioned the high interest rate and that's when I was told, ‘Don't worry about that. You're going to be refinanced in a year and your interest will be lower.'”

Franson has two children and works full-time as an administrative assistant. Several years ago, she said she was saddled with debts a former spouse racked up in her name, which damaged her credit rating.

In 2011, Coquitlam Chrysler sold her a 2009 Kia Hatchback for a sale price of $11,085.

The dealership arranged financing from TD at 22.92 per cent annual interest. Including all fees, charges and interest, the total cost to Franson was listed at $27,182 — more than twice the selling price of the car.

“It makes me sick to my stomach,” said Franson, who estimates her car is now worth $5,000. “It keeps me up at night because I'm paying more in interest than what the loan amount is.”

Many customers, same story

Franson and several other TD customers with similar loans insisted they only signed the papers because the dealership assured them if they made their payments they would get “refinancing” at a lower rate after a year.

Ashley Franson's auto loan interest rate
Franson has been paying 22 per cent interest on her TD car loan since 2011. She said her car is now worth about $5000, but she still owes more than twice that amount. (CBC)

“It’s not advice. They are asking a question and we are answering it. They are asking when can they come in and apply for a new loan and typically that answer is a year,” said Mark Hamilton, general manager of Coquitlam Chrysler.

He stressed lower rates are only possible if the customer pays all of their bills – not just their loan – and they don’t change jobs.

He also acknowledged customers are often not given those details.

“We’ve got literally 10 different people who sit down and negotiate these loans and everybody is going to say something different…I am more than happy to sit down with Ashley now and look at her overall deal and see what we can do.”


Franson’s story is almost identical to many others – customers who dealt with several dealerships in different provinces.

They all had a bad credit history or no credit history at the time of signing the deals. Many said they were desperate and vulnerable because they needed a vehicle and couldn’t get other financing.

They said the dealerships assured them paying the loans would help their credit ratings so the high interest rate was short-term pain for long-term gain.

“The finance manager worked some “magic” and was able to get me a preapproval with TD Auto Finance at 25.99 per cent,” said Jennifer Long, of Spencerville, Ont.

“I was specifically told that I could renegotiate the rate in a year, after I take the time to build my credit score. I remember this conversation very clearly.”

Turned down later by TD

Long said she contacted TD directly after the year was up and was told a much different story.

“The lady on the other end listens to all I have to say…she tells me 'Ms. Long I am sorry, the term you are locked into is a set rate, there is no renegotiating with this loan option. I am not sure why the finance manager told you that you could refinance in a year; that is not an option with your loan,'” said Long.

Greg Sentance of Thorold, Ont., is paying 22 per cent interest on a loan for a 2005 vehicle. He said TD told him the only way he could get a lower rate is to buy a new vehicle, which he said is not what the dealer told him. (CBC)

“I was also promised the same thing — that my interest on the car loan would go down considerably if I do not miss any payments in one year,” said Sohail Anwar, from Calgary.

“I have spoken to the [dealership] manager three times. Last time when I spoke to him, he said he would ask the sales agent to look into your file and ... to give me a call. I never heard from him thereafter.”

“It's highway robbery, is what I've gotten into”, said Greg Sentance of Thorold, Ont.

He bought a 2005 Chevy Impala from Certified Affordable Cars in nearby St. Catharines in 2011. He is paying TD 22 per cent annual interest, because of problems he had years ago paying his student loans.

"What clinched the deal that the interest rate could be brought down," he said. "Basically, I feel like I was lied to."

He said he has had no hits on his credit rating since taking out the loan, but was taken aback when TD recently told him he would have to buy a new car to get refinancing.

"You're up against a brick wall...you call TD Auto Finance and they say they really don't have anything to do with it."

Matt Demarco, finance specialist for the dealership, told Go Public the dealership would never refinance a customer without selling them a new vehicle.

"We are just giving them the information the bank gives to us," said Damarco.

TD's one-year offer

He said the one-year timeline comes directly from TD Auto Finance’s dealer’s handbook for 2013.


The dealership Sentance bought his used car at insisted it follows TD's handbook for dealers, which says customers who make their payments can get financing at 10.9 per cent for a trade in, after a year, on approval of credit. (CBC)

“TD Auto Finance values its customers and offers current customers who have made 12 months of timely and consecutive payments an opportunity to trade in their vehicle with rates starting at 10.9 per cent or 9.9 per cent with the flex rate option on approved credit,” reads the handbook.

Many of the customers who were turned down by TD after a year said they weren’t told why.

Industry insiders who contacted Go Public said giving false or misleading promises of refinancing after one year is common practice among some dealers.

“They say it when it’s not true because the subprime deals are very lucrative,” said a 30-year veteran of the car business, who was a sales manager who oversaw the business office.

He asked to not be named because he still works in the industry and fears he will lose his livelihood for speaking out. He said dealers often sell the used cars they can’t sell to regular customers to the people with bad credit, with a significant markup in price.

“The one-year promise is a tool to help seal the deal when the consumer’s resistance to the high rate has them thinking about walking away,” he said.

Dealers lie, say insiders

“It’s an outright lie. But it will never be put in writing. And that’s the challenge the consumer has.”

“Some dealers are unscrupulous and go for the throat,” said a current credit manager for a Chrysler dealership in Ontario, who claims his salespeople don’t lie to customers.

Doug Longhurst of the Motor Vehicle Sales Authority of B.C. said it's against the law for dealers to make misleading promises about refinancing, even when they are only verbal. (CBC)

He also didn’t want to be named, fearing repercussions from the industry.

“It’s the way it’s explained. Those dealers just want to get the deal signed. They don’t care about them in a year’s time. Some salesmen think about today’s paycheque, not next year.”

Even when the bank does agree to give a lower rate after a year, the ex-dealer said the subprime customer still ends up with the short end of the stick.

“Then the payment goes up and they give you the longest term they can. So it goes from bad to worse when the dealer offers refinancing,” he said.

Whatever amount is still owed on the high interest loan is rolled into the new deal, usually resulting in higher payments on another car that is also worth far less than the money owed.

That’s exactly the kind of deal Franson said the dealer came back with for her, 18 months after making all of her payments on the initial loan. She said Coquitlam Chrysler offered her $5,000 for a trade-in, when she still owed more than twice that much on the car.

“I would have been in a deeper hole,” said Franson, who said the dealer offered to finance a $20,000 vehicle, at a lower interest rate. “I still would have owed $30,000 on a $20,000 vehicle.”

She said she turned down the deal because she said she couldn’t afford the higher payments.

“It’s taking advantage of people who don’t have a choice. The dealer is doing that in the bank's name and they [TD] should look into that,” she said.

Regulator warns dealers

As a result of Go Public’s initial story, the regulator that oversees dealerships in B.C. is issuing a bulletin, warning dealers it’s illegal to make misleading promises about refinancing.


TD stressed it doesn't offer refinancing on loans for existing vehicles and it will 'reach out' to dealers to re-confirm its program as a result of Go Public's stories. (CBC)

“Everything that the salesperson says throughout the whole process, everything that the manager says, all of those are part of that transaction…part of the contract,” said Doug Longhurst of the Motor Vehicle Sales Authority of B.C.

Longhurst said the authority has heard this type of complaint before and will also investigate any new consumer complaints, with the possibility of penalizing the dealership.

"We’re an indirect lender. That means the dealer originates a car loan with each customer based on their individual information and vehicle needs," said a statement from TD. "To be clear, we don’t offer refinancing programs for existing car loans."

"Based on feedback Go Public has received, we will reach out to our dealers again to reconfirm our program."

Not surprising that others are now coming out of the woodwork and speaking out about feeling duped or mislead. These type of stories do that. From a risk assessment point of view I can obviously understand why these people are in a high interest loan however, salespeople making false claims to get deals signed is just plain wrong and clearly illegal. It's this behavior that has destroyed the customers opinion of the auto industry. Instead of the process being fun and exciting it's now defensive and met with resistance.

All these whiners should be careful what they wish for. A lot of them are fresh out of bankruptcy with $0 in their bank accounts. They don't have the option of buying a $5k car for cash. If they didn't get a subprime loan, they'd be taking the bus. That's not exactly an option for a lot of soccer moms.

They seem to think that the option is whine to the media and somehow the government will mandate that TD will finance them at 10%. This couldn't be further from the truth - in the crazy world that that happened, TD would just tell them to take a hike. Nobody is taking on the massive risk of a person who just admitted to being irresponsible with credit to the point of being declared legally bankrupt for 10%.

Mark

+1, Rich Dad Poor Dad has some good basic fundamentals but is overdramatized. Plus Robert Kiyosaki is a scam artist with his RDPD franchised seminars and programs.

http://www.forbes.com/sites/helaineo...-bankrupt-dad/

http://www.thesimpledollar.com/decon...bert-kiyosaki/

http://www.johntreed.com/Kiyosaki.html

Buys a car that they clearly can not afford (required a loan) then complains that they did not READ any of the information in the loan BEFORE signing it.....

Solution: Stop trying to live beyond your means. Buy a $1000 beater and stop spending money you do not have on things you do not need.

Everyone needs to do their due diligence before entering into a financial contract. Can't blame anybody but themselves.

stupid is as stupid does

The bus is an option regardless of your position.
People these days some how think that they NEED a car but the reality of it is you don't NEED one you WANT one.
The world functioned and worked just fine before everyone had a car. Hell, my grandmother never drove her whole life and took care of 2 kids. Taking on the bus, walking etc etc. Never an issue, she still does not drive yet manages just fine.
20something mother of two who made some crap decisions in her life NEEDS a car......sorry, no sympathy here.

People need to stop living with such a sense of entitlement and start living within there means. If you make $12/hr and drive a 10-20k car....your an idiot.

Not directed towards you lowside :P

I would agree with most of that however, the real problem lies with the salesperson telling them about the 1 year finance renegotiating option; which is impossible if I'm not mistaken unless they trade in their current car(and take a massive loss that is rolled into the new deal). Not stating that fact is deceptive(and illegal according to the VSA). Making a client think that they can renegotiate their current loan/vehicle to convince them to sign the deal is straight up lying.

Don't get me wrong, I'm not trying to defend the sub-prime demographic as they can be a fickle bunch to deal with. I am more concerned with the process as to how their loan is achieved and what is said/done during that process.

As a lender, sub-prime is not all created equal though. The person who racks up their credit cards, has no financial responsibility and decides to bankrupt themselves to get out of the debt then bitches about high interest rate can go fuck themselves. However, the single mom with 2 kids who got sick and couldn't work to pay bills may have to declare bankruptcy as there is no other option for her. Although both are now considered sub-prime I would be more inclined to help the sick mom. This decision, however, is not up to the business office as they are only shopping deals to lenders and bound by their parameters.

Read the story...and there was someone complaining about their 11k car being worth half of that now...WTF? A car isn't an investment. Its a depreciating asset that you have to get you from point A->B. People know exactly how much they're paying in interest so I dont understand what there is to complain about other than a shady car salesman promising something that can't be done

I think poor people have more of an entitlement complex than rich people.
Need a car, need a smartphone. blame their finances on others or the HST. Abuse social housing and demand more sqft

Living in Canada no one has the excuse to say there isn't work, or their situation just 'is what it is'

immigrants come into this country with little more than the clothes on their back and a desire to succeed, and as a result will work any job as long as it helps them make ends meet -- within a couple years they can all establish themselves

this idea of entitlement is a rampant problem the current generation IMO

What always pisses me off is people who bitch and moan about their current financial situation, they talk about how "unlucky they are", how "it is what it is", and especially how they assume they should have a right to luxury items, yet they flat out refuse to do anything that improves their aforementioned financial situation.

Tell that to everyone who has a mortgage (in the context of the amount of interest that one pays).

Most of the stories on that Go! Public is reporting on are saying that they declared bankruptcy, didn't pay student loans, and/or let a spouse rack up thier credit cards...

So they lied to thier banks when they said they would pay on time, and then feel duped when the banks lie back? they dont deserve pity.

Disagree. I come from a small town where transit service ran twice a day. A car was a necessity unless you lived in the urban area itself, and even then you could be walking a half hour or so across town to get to work. In the summer, not such a big deal, but we know how wet B.C. is when its not August or September. Couple that with having children and taking them with you to run errands if you can't afford a sitter, and extended trips by foot (where transit is not an option) are a real problem.
There IS a real need for a car at times. Just not a brand new one.

Agree. Its 2014 (2012 at the time they probably bought that car) so having children was well within her control. If you're not financially stable, why are you having kids? Fail me all you want, but this was the most obvious thing to me. Why did she need to pop out a couple of kids if she couldn't handle it financially? She lives in Kelowna, not the lower mainland, so well-paying work will be MUCH harder to come by so what did she expect? Do we live in an alternate universe where Gregory Pincus does not help invent the birth control pill? Is this the timeline where Planned Parenthood doesn't exist to help women obtain birth control? Is that her excuse? Really? Well holy fuck.

Outside of the lower mainland I'd expect that would be the average wage for an unskilled worker with a little experience under their belt. Some of them probably feel they have money to burn because they "earn more than minimum wage".
And they can afford that loan, right? Because 25% of $20,000 is $5000 so they'd only have to pay back $25,000! because thats how it works, right? i don't need to read the fine print, right?


Best quotes of the article

Rich people, right guys?

How can you deny me? No, wait, how DARE you deny me!

How dare this financial institution not bend over backwards to make my life convenient when I've cracked under the pressure of credit in the past.

This is dubious. I don't actually believe this is true, but it makes them seem more victimized by a big rich car dealership so it was included in the story.

I wouldn't say that. A single loan rep surprised at the amount someone was willing to pay to buy a domestic that will literally bleed value over the term of the loan doesn't equate to a financial institution not knowing what is "going on with their own loans"

This should be the quote that child protective services uses in their case against Hauser. They saw a shiny that they wanted, made a really poor decision, and now their child is in a tough spot because of it. Thank goodness, and I'm being genuine here, that our tax dollars go to making sure that child doesn't go without.

It was caused by people buying things they couldn't afford or thought they could afford but neglected to read the fine print before proceeding. As much as this seems like a "murica" problem, its an "irresponsible person" problem and could happen here if we had the same easy lending they did between 04 and 08.

This is almost yellow journalism. It is a fact presented in such a way that it will make you believe it to be worse than it is. As lowside said, dealers do get a cut and receive referral fees, but they are not likely incentivized to stick people who are in a tough way with a shitty loan.

True. I completely agree, but nobody is forcing anybody to pay this.

And why do they keep trying to give TD a bad name? If anything, the dealership (or salesman) would be the one that 'mislead' them the most.

I don't understand why people are making TD out to be a villain in the general public.

TD isn't obligated to offer a god damn thing to these customers. They are offering sub-prime rates because the customers present them with EXTREME risk based on their financial history. TD isn't hiding the financial costs of these high-interest loans, it's in black and white in the contracts that these customers are signing. If these customers are upset about the promise of being refinanced when ultimately they were not eligible then they need to direct their frustration to the dealership where the promise happened. But even then, the customer should ultimately have asked for written confirmation that after 12 months they would have been eligible for a reduced rate, which they would never have received because it wasn't an option. Banks don't offer sub-prime rates and then magically re-up after a year at a massively reduced rate except in the most extreme circumstances. Twelve payments does not erase a history of terrible financial decisions.

At the end of 2012 I bought a two year old Range Rover Sport (used) from an Infiniti dealership. It was NOT a financially sound decision. It was an emotionally driven decision based on where I was in my life at that time. That said, as much as it was an emotional decision and as much as I loved the car I wasn't about to pour a horrific amount of dollars into financing and was willing to walk away. The dealership secured a loan for me with RBC at just over 3% over five years. I paid the car off last week and salvaged some of those interest dollars in the process.

If I couldn't get a good rate, I was perfectly content to continue riding transit and nursing my old car along.... I had wanted a Range Rover Sport for five years but wasn't able to sacrifice my future to do it.

These customers should be held responsible for THEIR buying decision.

If a sales manager/finance manager/salesperson is promising that you can be refinanced after a year HAVE THEM SHOW YOU IT IN WRITING OR HAVE THEM WRITE IT DOWN... they won't, because they know their is no guarantee.

In my business I constantly coach my staff to UNDER PROMISE AND OVER DELIVER.... especially with respect to financing and financial matters... we take supreme care to look after our customers so over promising only costs us and the customer in the longrun... if we lose a customer because we are unwilling to commit to something that is unfeasible than so be it.