When Mary Bolender's young daughter fell ill with a high fever, the mom knew medical care was needed fast. Instead of going on a quick trip to a nearby Las Vegas emergency room, the family's minivan sat dead in the driveway. But it wasn't a mechanical failure that kept them from potentially lifesaving medical care. The mom's auto lender had engaged a remotely operated kill-switch on the family car.
Bolender was only three days late on her car payment after taking off work to care for her sick daughter. To get a subprime auto loan, she had accepted a "starter interrupt device" installed on the car. It allows the lender to remotely deactivate the car's ignition switch when a payment is late.
You might say that it's all Bolender's fault for being late on her payments or for having bad credit in the first place, but according to payment records she wasn't officially in default any of the four times her loan company shut down her car. According to some legal professionals, it's a predatory scheme. The New York Times reports:
“No middle-class person would ever be hounded for being a day late,” said Robert Swearingen, a lawyer with Legal Services of Eastern Missouri, in St. Louis. “But for poor people, there is a debt collector right there in the car with them.”
But there's something even scarier than Mary Bolender's situation, and it could deadly dangerous for the borrower and anyone around him or her in traffic.
Candice Smith was driving down a busy three-lane freeway in Las Vegas when suddenly the power steering went out and the engine shut down. The car was stranded in the middle of the freeway as high speed traffic whizzed by. She ended up having to get out and push her car to the shoulder. She was scared for her life. The GM ignition issues that caused the recall of 800,000 vehicles showed us the danger of what can happen when your car loses power on the road.
Smith claimed her lender's starter interrupt device shut her car down in the middle of a busy freeway. Though the lender claims that's impossible, it settled with Smith out of court for an undisclosed sum. Would you feel safe knowing that any car around you could be remotely shut down by a lender?
And that's not even the whole of it. These gadgets can track your GPS location and send the information back to repossessors. That's an extreme privacy invasion. One Texas woman who fled her abusive husband says her car was tracked down and repossessed because of a clause restricting her from driving outside of a four-county radius. The shelter she was hiding in was outside of that radius:
“She was terrified her husband would be able to find out where she was from the tow truck company,” said Ms. Kleinpeter, a consumer lawyer in Austin, who said a growing number of her clients had the devices installed in their cars.
What do you think about starter interrupt devices? Are they helpful in getting people with bad credit much-needed auto loans? Or are they predatory and dangerous? Let me know in the comments below.