Kansas car dealer liable for $14.8 million for falsified loans, highlighting consumer risk in debt accrual leading to repayment issues

Posted on November 27, 2023 at 4:58pm by

In a recent lawsuit against a Kansas car dealership, an independent arbitrator found the dealership to be liable for more than $14.8 million in damages for customers whose information was falsified on their credit applications. For these customers, this resulted in higher loan payments and increased financial stress.

In a report from Missouri Lawyers Media, the lead attorney for the 31 claimants, Ken McClain, said that the dealership was falsifying the information on the applicants’ credit applications. Information like income and job titles were inflated to ensure the applicants would qualify for larger loans, likely loan amounts that these customers would have trouble making repayments on.

For example, McClain described that one claimant who works as a front desk clerk at a hotel was described as a ‘front end logistics specialist’ on the credit application submitted for her.

With this falsified information, customers were receiving larger loans, which the dealership took advantage of to sell add-ons for the customers’ vehicles. As customers qualified for these larger loans, this resulted in higher loan payments as well as increased financial distress that resulted from the increased payments.

While the arbitrator found the dealership liable for the damages in the end, the stress these customers faced is reflective of the reality of millions of Americans facing loan repayments. In an article from First Republic, it is estimated that more than 340 million Americans carry some form of debt. And as interest rates only continue to rise, customers continue to feel the pressure on their finances and monthly payments.

If you are feeling overwhelmed and uncertain about meeting your monthly loan payments, filing for bankruptcy may be an option to help relieve some financial stress and help you on your way to financial freedom. If you have questions about bankruptcy, contact a member of our team at Sader Law Firm today at (816) 561-1818 for a free phone consultation and information on what options will work best for you.