TitleMax customer warns of deceptive car title loans

SAVANNAH, Ga. (WTOC) - It’s something people will do when they’re desperate for money: relinquish their car’s title for quick cash.

But financial experts say car title loans are risky business. That’s because people often can’t pay off the loan in time and either lose their car or end up paying the lender way more than they owed in the first place.

We recently told you about TitleMax: the giant title-lender founded in Savannah. They’ve once again been fined millions of dollars by the Consumer Financial Protection Bureau for deceptive sales practices and high interest rates.

One man said his agreement with TitleMax turned his life upside-down.

Drive across the Southeast and you’ll notice many lenders offering fast-cash for your car’s title. But one in particular seems to stand out. From their familiar jingle to the multi-million-dollar fines they’ve faced, TitleMax has made a name for itself.

Former Pooler resident Rodney Paylor said he found out first-hand why the Consumer Financial Protection Bureau calls TitleMax a “repeat offender.”

“I don’t want them to take my car, because that’s how I get to work,” Paylor said.

Paylor signed an agreement at the TitleMax off Highway 80 in Pooler back in October, handing over the title to his Lexus LS for a $3,600 loan. TitleMax gave him a month to pay it back with interest, meaning he owed that plus an extra roughly $450. But Paylor said the TitleMax agent did not explain that to him. He said she told him he could pay it off over time in $450 installments.

All these months later, Paylor now sees he’s only been paying off the interest, not the roughly $4,000 he owed from the principle loan. It’s something he said the salesperson did not explain to him.

“She didn’t even have the screen towards me!” Paylor said. “She said, it’s a whole lot of words, don’t worry about it. I’ll take care of it for you,” he added. “I didn’t see anything until she told me where to sign.”

Paylor’s agreement has him paying a more than 150% annual percentage rate, or APR. He estimates by the time he pays-off his car title, he will have given TitleMax nearly $10,000 for a $3,600 loan.

Paylor said he went to TitleMax, because he needed cash to help pay for childcare for his son. He feels the agent took advantage of his desperation.

“That’s entrapment at its finest! Because they find, they find people that are in a hurry for cash,” he said.

The Federal Trade Commission calls car title loans “expensive,” and warns that you could lose your vehicle. They add that some lenders insist on installing a GPS system and starter interrupt devices so they can locate your car, disable it remotely and repossess it. They can then sell your car and keep all of the money.

Paylor’s advice for you? If an agreement sounds too good to be true, “Nine times out of ten, it is” Paylor said. “Especially if you’re dealing with TitleMax.”

After WTOC Investigates interviewed Paylor, we reached out to TitleMax to ask about their agreement. The next day, Paylor said TitleMax contacted him and agreed to let him out of the contract and give him his car title back.

TitleMax also responded to WTOC’s request for comment. TitleMax Sr. Communications Manager & Social Media Strategist Josie Gregory provided us with the following statement:

“We always work with our customers on any alleged issues and have taken the opportunity to do so with this customer,” Gregory said.

In March, the Consumer Financial Protection Bureau fined TitleMax $15 million for violating the Military Lending Act and making prohibited loans to service members and their families. They also call TitleMax a repeat offender.

In 2016, the Bureau also fined the company $9 million for violating the Consumer Financial Protection Act. TitleMax has more than 900 locations nationwide and posted more than $900 million in revenue in 2019 alone.

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