Delaware-based TitleMax illegally charged customers interest rates of 132%, running a “sophisticated loan sharking operation,” a new class action lawsuit alleges.
The class action lawsuit was filed in Pennsylvania by lead Plaintiff David Mayo, who alleges TitleMax violated Pennsylvania’s Loan Interest Protection Law and Unfair Trade Practices and Consumer Protection laws.
According to the claim, Mayo experienced financial hardship over the past winter as a result of the COVID-19 pandemic and fell behind on bills and needed cash. Mayo has poor credit and was turned down for credit from conventional lenders, so, as a result of an internet search, he ended up applying for a loan from Titlemax.
On April 10, he got a 48-month loan from TitleMax for $7,751.39 at an annual percentage rate of 132.01%. He alleges that the total loan repayment, which includes a finance charge of $33,452.71, is $41,204.10.
“In total, TitleMax seeks to be paid a total of $41,204.10 to satisfy a loan for $7,751.39,” the claim states.
Mayo says in the class action lawsuit that the legal rate of interest for an unlicensed lender in Pennsylvania is only 6 percent per annum, meaning the permissible finance charge on his loan with TitleMax is only $986 and what the company says he owes exceeds the permissible charge by $32,466.71.
Mayo’s loan is secured by his 2020 Ford Fusion, which has a market value over $20,000, and TitleMax is threatening to come to Pennsylvania and repossess the vehicle unless he pays $33,452.71 in interest, the claim says.
“Mr. Mayo needs his Vehicle for transportation to work, and will suffer substantial and irreparable injury if the Vehicle is repossessed, including loss of income and the loss of ability to support himself,” the class action lawsuit reads.
At $858.42 per month, the payments on the loan are higher than Mayo can afford, and the $33,452.71 in interest he is scheduled to pay on the loan “is money Mr. Mayo needs for his own living expenses in Pennsylvania for basic necessities for things such as rent, food, clothing, healthcare, transportation, and communications,” according to the claim.
Mayo alleges that Titlemax hid the loan terms when he took out the loan, with the loan officer preparing the agreement on a computer with the screen facing the loan officer.
“The loan officer had Mr. Mayo accept the agreement on the computer, but the loan officer did not turnover control of the computer to Mr. Mayo so he could see the entirety of the agreement he was accepting. TitleMax did not let Mr. Mayo see the disclosure of the annual percentage rate, finance charge, total payments, or payment schedule,” the class action lawsuit claims.
According to the claim, TitleMax runs a “sophisticated loan sharking operation in which it makes small loans at triple digit rates of interest” to consumer borrowers secured by their cars.
“These loans are used to exploit borrowers with poor credit and a crushing need for cash,” it reads.
For each loan TitleMax makes to a customer in Pennsylvania, the company acquires a property interest in collateral located in the Commonwealth and records a lien on the collateral with the Pennsylvania Department of Transportation, the claim says.
However, the class action lawsuit says that TitleMax’s rates of interest violate Pennsylvania law, whose usury statute is unwaivable. It says that while TitleMax insists that it can make Pennsylvania borrowers waive the law’s protection by having them sign a loan agreement that contains a Delaware choice of law clause, that is not the case.
“The Delaware choice of law clause is unenforceable,” the claim reads.
Mayo wants to represent a class of Pennsylvania who may in the future enter into an agreement with TitleMax for a loan with an interest rate above 30 percent . He is suing for violations of Pennsylvania’s Loan Interest Protection Law and Unfair Trade Practices and Consumer Protection laws, and seeks certification of the Class, damages, attorney’s fees and costs.
Have you ever been charged an interest rate on a loan that was more than 30 percent? Tell us about you in the comments section!
Mayo is represented by Robert F. Salvin, Esq.
The TitleMax Interest Class Action Lawsuit is Mayo v. TitleMax of Delaware, Inc., in the Court Of Common Pleas, Philadelphia County, Pennsylvani
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264 thoughts onTitleMax Hides 132% Interest Rate When Loaning to People in Financial Hardship, Class Action Alleges
How do I get in on the lawsuit I have paid $12000 on a $1800 loan and I still owe $2600 title max should be ashamed of themselves
I have a title max loan and it’s horrible paying only for an extension that never goes towards the balance you owe and it seems like the balance gets further out of reach while paying for the extension should basically pay off the balance over time you’ll never be able to grasp the concept because the money goes literally towards nothing it’s predatory at its finest
I’m currently trapped in a TitleMax loan!!! I took out the loan in August for 3900, and have nearly paid that, but of course it is not going towards the principle…. No matter how much extra I pay each month. It will take me longer to pay off a 3900 loan than it took me to pay off my car!!! TitleMax needs to be held accountable for these illegal tactics.
Hi I’m in Texas and yes I am being charged double or more on a car title loan with Title Max I’m in Fort Worth Texas but the moved my location to Burleson Texas I started with 700.00 then I was able to get more on top of the 700.00 … That’s where I noticed that I was being double financed charged 💥 by their system…by the company of course I’m in the process of getting this resolved 02/07/2025
I also am in Texas with a 750. Loan from Title Max and am seeing these same predatory practices going on with my loan through them. Now they threaten the next day if you aren’t able to come in. Saying and calling daily without relenting.
I received a title loan from TitleMax and was not given information on interest rate, number of payments and signed electronically. I have an interest rate of 155.65%. My car has not been repossed and I’m not late in payments but feel the interest rate is illegal.
Please help.
I got a letter from titlemax saying I had been , well all my info had been involved in a data breach, they offered me credit monitoring services free for a year, I took advantage of that, I would Like to be a member of the class. Where do I sign upm
I got a TitleMax title loan for $2,000 initially I knew there would be a fee and interest but I’ve paid $900 and $700 payments over and over and the amount just kept climbing at an astronomical level I lost my job and they repossessed my car left me owing close to $6,000
I just saw titlemax in jasper Georgia
Repo neighbor’s suv without sending her text message when it’s dues. glad I don’t have them..They were brutal and never gave her title back after paying.I told her get a lawyer out of county..
I need help or a referral to someone who can help me. I got a title loan 30 days ago for 1700. I went to make a payment today and in 30 days .. now I owe over $2700. $1000 increase in one month. I will never get it paid for. They bought out my title loan because they told me they would give me better interest rate … But I’m worse off now, and I was in good standing with the company I originally had title loan with. Yet here I am 30 days later and owe $1000 more. This isn’t right. Not only that, they went to the company I was with and was soliciting business. Telling them to send business to them since they were no longer going to be doing title loans. I was standing there while they exchanged information. She knew they were not going to be helping me at all . I never even provided proof of income or anything. Nothing except copy of title. I’m on disability but I had to take a part time job.. but I will never get it paid for. I have never been evicted in my life. Been with landlord 8 years. But I’m going to lose everything. And my car. This is deception. Misleading. She never told me . Oh your getting a good deal where you are(cash max)…,and we can’t n’t beat that interest rate. Knowing I was going to be owing more going with title max.