DES MOINES, Iowa (Legal Newsline) - Iowa Attorney General Tom Miller announced an agreement on Thursday with an Urbana used car dealer to resolve allegations it collected finance charges and fees it was not allowed to collect.
Urbana Motors Inc. allegedly violated Iowa's Truth in Lending Act and the Iowa Consumer Credit Code. The dealer also allegedly improperly repossessed vehicles. Under state law, creditors must give consumers a 10-day payment grace period before a customer is in default. If the default is the customer's first in a 365-day period, creditors are required to give consumers a notice of their right to cure default.
Additionally, creditors are required to offer consumers the chance to cure the default within 20 days.
Under the terms of an assurance of discontinuance, Urbana Motors agreed to refund fees it was not entitled to collection, including late fees assessed before 10 days after a payment due date. The dealer also agreed to comply with the Truth in Lending Act going forward. Compliance with the law includes accurately disclosing total sales prices, annual percentage rates, total payments and total amounts financed.
Urbana Motors also agreed to forgive any outstanding balance owed for any consumer who had their vehicle repossessed improperly in the last two years, refund consumer charges associated with improper repossessions and contact consumers within 90 days regarding refunds.