Kentucky consumers will receive more than $10 million in debt relief and restitution through a proposed $694 million nationwide settlement with Credit Acceptance Corporation, Attorney General Russell Coleman announced Monday.
The settlement alleges that the auto lender made predatory loans to consumers it knew could not afford them. The agreement has been submitted to Scott Circuit Court for review and approval.
Kentucky also will receive more than $264,000 in monetary relief.
“This company preyed on our vulnerable neighbors, digging them into a hole of debt. Our Office will always fight for Kentucky consumers and their hard-earned dollars,” Coleman said.
Under the settlement, CAC must disclose loan risks, provide protections for consumers with certain high-risk loans and guard customers against unwanted vehicle service contracts and Guaranteed Asset Protection products.
The agreement includes several long- and short-term requirements intended to reform the company’s lending practices:
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Consumers with certain high-risk CAC loans issued beginning in December 2025 will be offered “off ramps” for loans that fail quickly. Qualifying consumers will receive 95% debt relief, and CAC will be prohibited from filing collection lawsuits against them. The company must offer the relief for five years beginning Nov. 2, 2026.
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CAC must establish a process to prevent the unlawful packing of vehicle service contracts and Guaranteed Asset Protection products into loans. The requirements include enhanced disclosures before purchase, post-purchase notices informing consumers about the products and a simpler cancellation process. CAC also must monitor dealers for compliance.
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The company must provide consumers with pre-loan disclosures explaining the risks of default and the value of the vehicle.
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For seven years, CAC must cap vehicle prices at 109% of retail book value for certain consumers.
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CAC must implement safeguards to prevent dealers from increasing vehicle prices based on a consumer’s creditworthiness or charging more than the advertised price.
The requirements take effect Nov. 2. CAC must notify eligible consumers about the relief available to them.
Kentucky and 38 other states are participating in the settlement.
Official photo of Russell Coleman courtesy of the Office of the Attorney General
