I recently wrote about some of the abuses of Pay Day or Title Loan companies when they collect debts and a natural question is “WHY” do they do this? Or why do they think they can get away with it?
First, most of these lenders are not considered debt collectors so they are not controlled by the Fair Debt Collection Practices Act (FDCPA). Thus, they think they can get away with all sorts of high-handed abuse towards consumers. They have forgotten about Alabama state law – such as invasion of privacy, false imprisonment (when they block your driveway), and other similar causes of action.
Second, all of these agreements have arbitration provisions in them and the thought among most consumers (and frankly lawyers also) is a consumer can’t win in arbitration. To be clear – I do not like arbitration or more specifically I don’t like mandatory arbitration. But it is possible to win in arbitration.