Whenever Brenda Ann Covington required cash some time ago, she had only 1 big product left to pawn: her Chevy vehicle.
Covington utilized the 2005 Silverado as security to borrow funds from 1 associated with the growing wide range of Virginia companies that provide cash against someone’s vehicle.
aided by the loan’s rate of interest of about 240 %, Covington will probably pay almost $4,100 to possess borrowed $1,500. Worst of all of the, before she took out the new loan if she defaults, the lender can seize her truck, which was paid for.
“we can not blame anybody but myself,” stated Covington, 61, of Manassas. “but it is highway robbery.”
Company is booming for Virginia’s vehicle name loan providers, but consumer advocates state it is absolutely nothing to commemorate.
The state has become a magnet for people who need cash but live in Washington, Maryland or another neighboring jurisdiction where laws capping interest rates have effectively driven such lenders out of business since a change in Virginia law last year.