Credit Acceptance Corporation has agreed to a $710 million settlement with 40 states and Washington, D.C., that will erase roughly $634 million in remaining car debt for more than 55,000 borrowers. The agreement resolves allegations that the subprime auto lender placed borrowers with low incomes or damaged credit into auto loans it knew many could not afford, with loans originated between November 2015 and November 2025. Under the deal, Credit Acceptance will also pay $60 million in restitution to thousands of other borrowers and a $15.5 million penalty, while denying wrongdoing. New York Attorney General Letitia James said the company preyed on consumers with false promises of affordable loans, and CEO Vinayak Hegde called the agreement constructive, customer-focused and consistent with the direction of regulatory expectations in the industry. Borrowers must be covered by one of the 40 participating states or Washington, D.C., and meet the settlement's criteria for debt cancellation, which include a Credit Acceptance score below 56 and payments equaling at least 13% of monthly income.
Credit Acceptance CorporationCredit Acceptance agreed to a $710M multistate settlement, forgiving $634M in car debt and paying restitution and penalties over predatory subprime lending.
Yulon Finance Corp