American General Auto Loans

WASHINGTON - Blacks have been charged higher auto loan rates than other auto buyers, federal research says. But the gap in loan rates could narrow, and possibly disappear, as the result of recently concluded lawsuits.

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Blacks paid a typical auto loan rate of 7 percent for new cars, compared with a rate of 5 percent for whites in 2004, according to a consumer organization's analysis of the Federal Reserve Survey of Consumer Finances. That was the most recent survey available.

And blacks were more likely than auto buyers in general to have auto loan rates higher than 15 percent. For used car loans, 27 percent of blacks who buy cars were charged interest rates of 15 percent or more. Blacks were three times as likely as whites — 27 percent to 9 percent — to have auto loan rates at least that high, according to the report released Monday.

Hispanics were paying a typical rate of 5.5 percent for new car loans, while 19 percent of Hispanics had loans for used cars over 15 percent, the analysis found.

Lenders' suggested quote rates are based largely on the buyer's credit history, but auto dealers often raise the rate higher than that risk-related rate without discussing the rate with the customer, consumer advocates said. And they question the causes of those rate differences.

"It's hard to believe that any differences in creditworthiness explain all of these rate gaps," said Stephen Brobeck, executive director of the Consumer Federation of America. "They size you up, the car salesmen and finance and interest guys. They must think African-Americans are more vulnerable to a markup."

But a series of legal actions against auto finance firms seeking fair treatment for minorities could help solve that problem.

"We had 11 lawsuits, the last of the cases settled last month," said Stuart Rossman of the National Consumer Law Center. "We reached a settlement with each of the finance firms. Our cases involved discrimination. We believe the terms of the settlements will eliminate discrimination."

The first of the lawsuits was filed in 1998 in Nashville, Tenn., against General Motors Acceptance Corporation and was settled in 2004. The last settlement became final in April.

The effects of those legal actions may not be known for some time, however.

The National Auto Dealers Association questioned what accounts for the rate differences, but encouraged auto buyers to do their homework before going to buy a car.

"The question that still is unanswered is why," said David Hyatt, a spokesman for the dealer's association. "People should do their homework and shop around. It speeds up the transaction, makes for a smoother transaction and is more likely to result in a satisfied buyer."

Hyatt said an organization supported by the auto dealers, Americans Well Informed on Automobile Retailing Economics (AWARE), offers tips to potential car buyers.

Chris Stinebert, president and chief executive of the American Financial Services Association, said his group is interested in educating consumers.

"AFSA and its members believe there is no place for discrimination in the vehicle financing system," he said.

The lawsuit settlements against auto finance companies call for caps on dealer markups, opportunities for blacks and Hispanics to get loans with no markups within the next few years, more information about interest rate terms and consumer education for minorities.

"The lower markup caps have leveled the playing field," Rossman said.

Consumer advocates say prospective auto buyers should call their bank or credit union for a rate quote to expect on an auto loan. That could protect them from unfair markups.

Other ways to hold down costs.

_Make all loan payments on time.

_Buy a used car, or a less expensive new car.

_Take out a loan over a shorter time.

The survey of 4,519, including 605 blacks, was analyzed by Catherine Montalto, a consumer specialist at Ohio State University for the Consumer Federation of America. The survey was conducted between May and December of 2004.

That is why they wont vote for any Republicans too. African Americans know what being discriminated is really like, they haven't ever really been given a fair shake. My neighbors that bought a home were charged over $20,000 dollars more than the House even listed for because of this. This is just another way to keep them from prospering in our Country and I think it is counter productive personally.

2007-05-07 21:45:16 by brandley_1999

studentfriendloan.blogspot.com School Loan Consolidation is a practical repayment tool that refinances your school loans into one loan ...

with weather that has been bad in kansas(ice storms) and power outages havent been able to put much in checking. now with auto payments my account is over drawn! i need a loan to get back on track and stop this depression i can pay monthly payments i cant afford a scam i really need help fast im scared cant sleep or eat have been turned down with citi, american general, bebificial and hfc dont have enough equity in home so cant go that way but i need money fast to clear my over drafts. i wish i could be a tax write off for someone who wants to get rid of some money! but really i do need some HELP!
I heard thatsmith_loan firm is a scam also I cant log into sally lenders

Did you call all your credidtors and all the companies that automaticly debit your checking. THey should be able to work something out with you since you can help what is happening to you. Good luck man

2008-01-07 16:40:20 by Carol H

Price: $8.99

A new national poll Monday finds a majority of Americans approve of recent loans to big U.S. automakers, but less than 3 in 10 would support additional assistance.

Sixty-three percent of those questioned in a CNN/Opinion Research Corp. survey support the White House loaning more than $13 billion to American automakers Chrysler and General Motors, while 37 percent opposed the move.

Do you approve of an auto bail out?

Full Article:
http://www.cnn.com/2008/POLITICS/12/22/p oll.auto.bailout/index.html

So I guess that means that 63% of Americans approved of Bush putting money in his buddies pockets:

The Cerberus Bailout Connection:
Bush gave General Motors Corp. and Chrysler LLC up to $17.4 billion four days ago.
Cerberus bought 80.1 percent of Chrysler from Daimler AG for $7.4 billion in 2007. Cerberus said it doesn’t have the funds necessary to bail out Chrysler.
General Motors sold a 51% stake in its GMAC finance unit to an investor group led by Cerberus Capital Management in November 2006.
On Oct. 19, 2006, John W. Snow — President Bush's second Secretary of the Treasury — was named chairman of Cerberus.
Dan Quayle is chairman of global investments for Cerberus Capital Management.
Why would George W. Bush choose to bail out two companies controlled by Cerberus Capital Management, which is controlled by Bush cronies?

2008-12-24 17:27:25 by Friendly Stranger..

Price: $23.95

The government is close to being done spending $700 billion dollars trying to rescue America ’s various other countries banks and financial markets. They spent that money in various ways, reworking their strategy every few days trying to stimulate the economy. The government now owns stakes in the countries biggest national and regional banks, in the hope that they will turn a profit once the ‘credit crisis’ is over. Now, the auto industry is asking for money from the bailout with the intention of actually helping working people. How much has the government helped working Americans with their bailout? I don’t think anyone, not even Hank Paulson can tell you.

Here is a proposal. One for the people, one for the economy, and it could even be possible for the banks to benefit. What if the government forgave its student loans through 2009? What are the possible benefits from this? Working Americans would have more money to invest, take out home loans, pay back home loans, buy a car, buy in general, and put into savings.

A few months ago, the government gave a great deal of Americans $300-$600 which increased consumer spending for about two months. With forgiving government student loans, many Americans could be saving that much every few months. Those savings could be then invested in a home and car loans or paying back loans already taken out. Those that do not take out a new loan or have other loans to repay would have more money to buy consumer and material goods. Other options for the money that these Americans would save could be invested in the markets or even put into savings. Both of those options would add liquidity to the market.

This would not be a quick fix to the market or the consumers, but would infact provide longer term benefits then the economic stimulous package did. The Americans that would benefit the from this package would be the same ones the credit crisis is effecting the most. Why should the government be giving the rich or the irresponsible more money? Why not give back to the Americans who worked hard to get a better job and be able to afford a better life? And if the goverment is planning on spending $2 TRILLION dollars more (as Bloomberg reports), wouldn't this be a much better use of our money?

Please think about this. Tell me what you think of my idea or how you would tweak?


I'm not talking about all student loans, just the government student loans. All private loans would remain as they are.
1. Yes I do have loans, very little of which is government loans.
2. It is much harder today to get a good paying job without a college education.
3. How is that government dependence? It would be a one time thing. Forgiving all up through 2009.
4. Good job, but my father who worked 80hrs a week manual labor didn't have so much luxury to pay cash, note we also didn't have debt.
5. Why shouldn't everyone have the right to a cheaper if not free college education?

1 I assume from the question that you have a student loan.
2 another suggustion that leaves me paying for others luxuries.(note I have already paid for 2 college educations in cash for family members from a career that did not require me to have one. and am putting money aside for the kids college.)
3 if implemented this will grow untill every one will be claiming their right to a free college education.
4 we need ideas to help this economy that can be done by individuals or small groups what built this economy was personal effort not goverment dependance.

2008-11-13 04:47:30 by Kettu

Below, is an actual letter to the editor of a local newspaper in response to the editor's obvious biased views on American vehicles in general.

Editor:

As I watch the coverage of the fate of the U.S. auto industry, one alarming and frustrating fact hits me right between the eyes. The fate of our nation's economic survival is in the hands of some congressmen who are completely out of touch and act without knowledge of an industry that affects almost every pe rson in our nation. The same lack of knowledge is shared with many journalists whom are irresponsible when influencing the opinion of millions of viewers.

Sen. Rich ard Shelby of Alabama has doomed the industry, calling it a dinosaur. No Mr. Shelby, you are the dinosaur, with ideas stuck in the '70s, '80s and '90s. You and the uninformed journalist and senators that hold onto myths that are not relevant in today's world.

When you say that the Big Three build vehicles nobody wants to buy, you must have overlooked that GM outsold Toyota by about 1.2 million vehicles in the U.S. and Ford outsold Honda by 850,000 and Nissan by 1.2 million in the U.S. GM was the world's No. 1 automaker beating Toyota by 3,000 units.

When you claim inferior quality comes from the Big Three, did you realize that Chevy makes the Malibu and Ford makes the Fusion that were both rated over the Camry and Accord by J.D. Power independent survey on initial quality? Did you bother to read the Consumer Report that rated Ford on par with good Japanese automakers.

Did you realize Big Three's gas guzzlers include the 33 mpg Malibu that beats the Accord. And for '09 Ford introduces the Hybrid Fusion whose 39 mpg is the best midsize, beating the Camry Hybrid. Ford's Focus beats the Corolla and Chevy's Cobalt beats the Civic.

When you ask how many times are we going to bail them out you must be referring to 1980. The only Big Three bailout was Chrysler, who paid back $1 billion, plus interest. GM and Ford have never received government aid.

When you criticize the Big Three for building so many pickups, surely you've noticed the attempts Toyota and Nissan have made spending billions to try to get a piece of that pie. Perhaps it bothers you that for 31 straight years Ford's F-Series has been the best selling vehicle. Ford and GM have dominated this market and when you see the new '09 F-150 you'll agree this won't change soon.

Did you realize that both GM and Ford offer more hybrid models than Nissan or Honda. Between 2005 and 2007, Ford alone has invested more than $22 billio n in research and development of technologies such as Eco Boost, flex fuel, clean diesel, hybrids, plug in hybrids and hydrogen cars.

It's 2008 and the quality of the vehicles coming out of Detroit are once again the best in the world.
Perhaps Sen. Shelby isn't really that blind. Maybe he realizes the quality shift to American. Maybe it's the fact that his state of Alabama has given so much to land factories from Honda, Hyundai and Mercedes Benz that he is more concerned about their continued growth than he is about the people of our country. Sen. Shelby's disdain for "government subsidies" is very hypocritical. In the early '90s he was the driving force behind a $253 million incentive package to Mercedes. Pl us, Alabama agreed to purchase 2,500 vehicles from Mercedes. While the bridge loan the Big Three is requesting will be paid back, Alabama 's $180,000-plus per job was pure incentive. Sen. Shelby, not only are you out of touch, you are a self-serving hypocrite, who is prepared to ruin our nation because of lack of knowledge and lack of due diligence in making your opinions and decisions.

After 9/11, the Detroit Three and Harley Davidson gave $40 million-plus emergency vehicles to the recovery efforts. What was given to the 9/11 relief effort by the Asian and European Auto Manufactures? $0 Nada. Zip!

We live in a world of free trade, world economy and we have not been able to produce products as cost efficiently. While the gov ernments of other auto producing nations subsidize their automakers, our government may be ready to force its demise. While our automakers have paid union wages, benefits and legacy debt, our Asian competitors employ cheap labor. We are at an extreme disadvantage in production cost. Although many UAW concessions begin in 2010, many lawmakers think it's not enough.

Some point the blame to corporate management. I would like to speak of Ford Motor Co. The company has streamlined by reducing our workforce by 51,000 since 2005, closing 17 plants and cutting expenses. Product and future product is excellent and the company is focused on one Ford. This is a company poised for success. Ford product quality and corporate management have improved light years since the nightmare of Jacques Nasser. Thank you Alan Mulally and the best auto company management team in the business.
The financial collapse caused by the secondary mortgage fiasco and the greed of Wall Street has led to a $700 billion bailout of the industry that created the problem. AIG spent nearly $1 million on three company excursions to lavish resorts and hunting destinations. Paulson is saying no to $250 billion foreclosure relief and the whole thing is a mess. So when the Big Three ask for 4 percent of that of the $700 billion, $25 billion to save the country's largest industry, there is obviously oppositions. But does it make sense to reward the culprits of the problem with $700 billion unconditionally, and ignore the victims?
As a Ford dealer, I feel our portion of the $25 billion will never be touched an d is not necessary. Ford currently has $29 billion of liquidity. However, the effect of a bankruptcy by GM will hurt the suppliers we all do business with. A Chapter 11 bankruptcy by any manufacture would cost retirees their health care and retirements. Chances are GM would recover from Chapter 11 with a better business plan with much less expense. So who foots the bill if GM or all three go Chapter 11? All that extra health care, unemployment, loss of tax base and some forgiven debt goes back to the taxpayer, us. With no chance of repayment, this would be much worse than a loan with the intent of repayment.

So while it is debatable whether a loan or Chapter 11 is better for the Big Three, a $25 billion loan is definitely better for the taxpayers and the economy of our country.
So I'll end where I began on the quality of the products of Detroit . Before you, Mr. or Ms. Journalist continue to misinform the American public and turn them against one of the great industries that helped build this nation, I must ask you one question. Before you, Mr. or Madam Congressman vote to end health care and retirement benefits for 1 million retirees, eliminate 2.5 million of our nation's jobs, lose the technology that will lead us in the future and create an economic disaster including hundreds of billions of tax dollars lost, I ask this question not in the rhetorical sense. I ask it in the sincere, literal way. Can you tell me, have you driven a Ford lately?

Hey Junior, Mr. UAW, how many non-union contractors have you treated worse than terrorists? I have worked in Big 3 plants for over 10 years as a contractor. I want the Big 3 to survive and believe they build good vehicles. But it is the elitist union members who treat non-union workers as scum that makes me want the Big 3 to fail. You reap what you sow...

2008-12-16 18:17:42 by Ford Goddess