DES MOINES, Iowa (Legal Newsline) - Iowa Attorney General Tom Miller announced an agreement on Thursday with a Cedar Rapids used car dealer to resolve allegations of making loan disclosure violations, creating illegal loan contracts and charging excessive late fees.

Under the terms of an assurance of discontinuance, C.R. Cars agreed to modify its vehicle purchase and financing contracts to conform with the Iowa Consumer Credit Code, no longer finance consumer motor vehicles or engage in consumer credit transactions, refund all illegal or excessive finance charges, refund all repossession fees in cases of improper repossessions, and refund all excessive delinquency fees.

C.R. Cars will refund more than $30,000 to consumers as part of the agreement.

Miller alleged that C.R. Cars violated the federal Truth in Lending Act in its documents. The act requires that a lender conspicuously disclose certain pieces of information to a borrower prior to extending credit. The disclosures must include the annual percentage rate, the term of the loan and the total costs to the borrower.

The violations led to consumers paying higher finance charges than C.R. Cars disclosed in its agreements, repeatedly exceeding legal finance limits, Miller claims.

C.R. Cars also allegedly misrepresented the character, extent or amount of debt, charged and received late fees for delinquent payments that exceed legally permitted delinquency fees, contracted for and received default charges in excess of reasonable expenses incurred in collecting on debts or charges authorized specifically by law, required consumers to enter into financing agreements that illegally provide for the payment of the dealership's attorney's fees in default cases, required consumers to sign agreements authorizing the dealership to take the vehicle without a court order or judicial process, failed to provide notices of right to cure before repossession, and failed to file a required consumer creditor notification with the state.

C.R. Cars has since filed the consumer creditor notification with the state and has filed all required fees. The company agreed to stay current during all remaining open consumer credit transactions.

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