Lenders offering subprime auto loans prey on – and profit from – consumers with the poorest credit.
If you thought the 2008 US housing crash was the end of subprime bonds, think again. In this article, former New York Times reporter Gary Rivlin charts the rise of Wall Street’s latest billion-dollar baby: the subprime auto loan. He mainly focuses on the history of subprime auto-lending “pioneer” Don Foss’s auto-financing company Credit Acceptance, but Rivlin’s pointed analysis of the ongoing fight to regulate predatory auto lending carries broad, future-looking implications. getAbstract recommends this article to readers with an interest in the auto and financial markets.
In this summary, you will learn
- How used-car salesman Don Foss pioneered the subprime auto loan industry in 1972,
- How lenders profit by preying upon people with poor or no credit, and
- What difficulties stand in the way of successful regulation of and litigation against predatory auto lending.
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