- Associated Press - Wednesday, April 2, 2014

ALBANY, N.Y. (AP) - New York’s attorney general has announced agreements with 10 repossession businesses expected to help limit the marketing of short-term loans using cars as collateral.

With so-called title loans, the short-term borrowing by consumers with poor credit histories often carry high interest rates, making them difficult to pay off and easier to roll over for additional interest.

At the end of the loan, borrowers may face balloon payments or loss of their cars.

According to authorities, 10 companies have agreed not to repossess vehicles at the request of title-loan companies.

Under New York law, unlicensed lenders may not charge an interest rate of more than 16 percent.

In an attempt to skirt this law, they say title loan companies sell and take consumer applications online.



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