Is it legal for Dealer's (NJ) to place on an additional 1%-10% interest rate on loan before customer signs lender's contract?

Asked over 1 year ago - Port Charlotte, FL

My Husband in 2009, purchased a Mustang GT. He placed $7,ooo down to cover NJ State taxes of $1,766 (& $189 title transfer), Gap insurance of $600, SOLU fee ( Extended Service plan ,which he never requested,or used either ) in the amount of $1,695. He had great credit around a 750-800 and he was told the only Lender offer was an interest rate of 24.99%. Is it LEGAL for Dealership to tack on an additional 1%-10% rate point system for their own financial benefit? Believe it's called a "reserve rate". My Husband was never shown the original % rate from lender, even though he requested it. He was given the run around & then being told it was 24.99%. We currently live in Florida now & have to buy another vehicle soon. We want to know our legal rights if we can decline that extra %.

Additional information

If not legal to do this, is there a way to locate the original lender offer without the Dealer's additional rate % on it,so we can legally do something about that charge? And which type of Atty would we hire to review this case? My Husband and I hadn't know one another at that time either. If so.. I would of intervened in that sale. Ignorant decision which has followed him....Us now, for the last several years. Paying $544 monthly. This loan we are upside down on with being unable to refianance, or trade in... All of this due to from a higher % rate... He bought this car several months before his company merged with laying off over 3,ooo people, him being one of them. He worked there for 18 years.

Attorney answers (1)

  1. Galen J Criscione

    Contributor Level 13

    Answered . You may have some kind of case. An attorney would need to look at the contract that you signed. That is an extremely high rate (even before the tacked on part) for a person with that high of a credit score.

    This answer should not be construed as creating an attorney-client relationship, and is for informational purposes... more

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