BOSTON (AP) — A subprime auto lender has agreed to pay more than $5.5 million in Massachusetts to resolve allegations that it failed to provide proper explanations about its auto loan debt collection practices to consumers, the state attorney general’s office said Friday.
Disclaimer insurance filed in Suffolk Superior Court alleges that Santander Consumer USA failed to provide certain consumers with sufficient information about calculation methods for any defaults left on their auto loans after repossessing their cars.
The information is important to consumers trying to determine how best to respond to a lender’s collection efforts, the bureau said.
More than 1,000 Massachusetts borrowers are expected to be eligible for relief under the agreement.
Santander Consumer cooperated with the investigation without admitting wrongdoing.
An email requesting comment was left with a Santander Consumer spokesperson.
“Consumers struggling with auto loan debt should get clear information from lenders to help them navigate repossession and other collection actions,” Attorney General Maura Healey said in a statement. “This settlement, which combines cash payments with debt relief and credit repair, will help many subprime borrowers in need.”