Predatory Puppy Loans Make Consumer Groups Growl

Having a pet is expensive enough without paying exorbitant interest rates when you finance the purchase of your pup. (Of course, you should adopt not purchase but that’s another story).

The problem with the puppy loans arises when consumers finance their new animal friend through the pet store. Many of these stores use EasyPay Finance to handle the loans, which consumer groups say can lead to interest rates up to 189%.

That’s because some of EasyPay’s loans are issued by Transportation Alliance Bank (TAB), a Utah-based organization that the National Consumer Law Center calls a “rent-a-bank.”

Most states prohibit such sky-high interest rates but EasyPay, owned by Duvera Billing Services, launders loans through TAB to get around state laws, NCLC charges. Hundreds of consumers have filed complaints with the Consumer Financial Protection Bureau, Better Business Bureau and Ripoff Report.

The NCLC quoted a New Jersey consumer who bought a cocker spaniel. He said “[I] found that I am being charged 151.97% which is five times the legal limit of 30% that can be charged in New Jersey.”

A Georgia consumer complained that the pet store didn’t tell her that Easy Pay Finance charges 180% interest. “My puppy was supposed to cost $2500 now cost almost $7000.”

Other published complaints cited by NCLC include:

• Interest rates of 130% to 189%, with payments that mostly go to interest.
• Deceptive interest-free promotions, with consumers often unaware of the high interest rates on the loans.
• High interest rates charged to servicemembers.
• Debt collector harassment.
• Refusal to cancel loans for puppies that were sick and died.
• Credit reporting problems.

Social media storm planned

To call attention to the problem, NCLA is organizing a “social media storm” consisting of:

• February 17, Twitter crusade – using #PredatoryTABbank, #PredatoryPuppyLoans, #LoveYourPetDay, and #RentaBank.
• Sign NCLC’s petition urging the FDIC to stop banks like TAB Bank from helping EasyPay and other predatory lenders evade state interest rate limits;
• Help NCLC collect stories from people impacted by predatory puppy loans.