(DES MOINES, Iowa) The Attorney General’s Consumer Protection Division has settled an investigation of a Muscatine used vehicle dealership over the interest rates the dealership charged its customers.
The settlement with A-1 Quality Tire & Car Service, Inc., at 400 E. Third Street, also doing business as A1 Used Cars, at 613 Grandview Ave., is in the form of an Assurance of Discontinuance. The settlement reached this month resolves an investigation of the dealership for charging excessive interest rates in credit agreements with consumers who bought vehicles and financed them through the dealership.
Attorney General Tom Miller said that most of the car repayment plans involved vehicles older than two model years old, for which the Iowa auto loan interest rate cap is 27 percent, by law. “We found interest rates well into the 30 percent range and above,” Miller said. “We pursued this case to make sure that car buyers were not charged above the state maximum for interest.”
The settlement requires the dealership to refund the difference between the finance charge it imposed on consumers and the legally allowed maximum finance charge. Miller said refunds will come either as checks made out to the consumers or as an offset on money the consumers owe the dealership.
The settlement agreement also requires the dealership to comply with Iowa interest rate caps on auto loans in all future credit agreements with consumers.
Miller thanked the Iowa Department of Transportation, Office of Motor Vehicle Enforcement, for its assistance in alerting the Attorney General’s office in the conduct which resulted in the settlement.