Several high-interest loan companies are accused of using South Carolina as a haven to prey on low-income residents in North Carolina and circumvent that state’s consumer protection laws.
The lenders are facing a growing number of lawsuits in North Carolina for allegedly setting up shop along the border, luring people across the state line into South Carolina and convincing them to sign what are known as title loans.
Those small-dollar loans can carry interest rates of up to 300 percent annually, and require people to post their cars, trucks or motorcycles as collateral.
Hundreds of North Carolinians signed similar loan agreements in recent years. But many are now suing the lending companies in state and federal court, where they are represented by the Greensboro Law Center.
The lawsuits allege North Carolina law prohibits the loans from being enforced. And it is seeking money from the companies for seizing people’s vehicles and charging “excessive” interest rates.
The litigation targets some of South Carolina’s largest consumer lending businesses. That includes companies operating under the names AutoMoney Inc., TitleMax, Carolina Title Loans and North American Title Loans.