Credit Acceptance is one of America’s largest subprime car lenders, and it turned a massive profit in 2020 during the midst of the COVID-19 pandemic. Now, several states are investigating the company for predatory auto loans that take advantage of its customers, many of whom are already suffering from tarnished credit.

This story comes from , which profiles a woman named Monique Williams, who took out a high-cost auto loan with Credit Acceptance back in 2016. As the pandemic swept through the country, Williams lost her job, and she and her husband were struggling to make ends meet. But Credit Acceptance wouldn’t allow her to defer her payments on a car that was no longer functioning. From the article:

While the company offered some Covid-19-related accommodations — halting late fees and repossessions — deferrals were not an option.

“I have been paying for this car for four years — over $12,000 — and I couldn’t even get a deferment,” Williams said. The car died in December 2019, she said, but about $2,000 on the loan remains outstanding.

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Early in the pandemic, many lenders filled the gap left by the government, offering deferments and halting late fees; as a result, auto loan defaults last year fell to their lowest rate in 15 years, said Jonathan Smoke, chief economist at Cox Automotive, a company that provides services to the car industry.

Credit Acceptance, however, did not offer such deferrals. The company says it froze reporting on borrowers’ credit reports and suspended late fees and collection activities, such as phone calls and repossessions, for 90 days for customers hurt by Covid-19. After that, however, borrowers must make their monthly payments; if they don’t, the lender’s website says, the company may resume repossessions and late charges.

In this day and age, cars are an essential for many folks, especially those that were working essential jobs during the pandemic or who were attempting to find a job anywhere. With no federal aid or mandates regarding auto loans, however, many folks were left to struggle with payments.

And while many people are still struggling to get back on their feet, subprime auto lenders are ceasing any accommodations they were previously providing at the country begins opening back up. The world may not be back to ‘normal,’ but the expectation is that you will begin paying again or suffer a repossession. Now, Credit Acceptance is under legal scrutiny in 44 states.

One of those states, Massachusetts, settled out of court. From the NBC article:

Last summer, Massachusetts Attorney General Maura Healey sued Credit Acceptance, saying its lending and collection practices were predatory and illegal in the state. The company announced Thursday that it had agreed to settle with Healey, paying $27.2 million.

“Credit acceptance made high-interest loans to borrowers that the company knew they couldn’t repay,” Healey told NBC News before the settlement was announced. “What I consider predatory about these practices is that they’re specifically targeting vulnerable people, people who may not be able to qualify for normal loans, normal finance arrangements.”

Credit Acceptance did not respond when contacted for comment.