Ford engine Credit, the unit of Ford Motor business that produces car and truck loans, has been taken fully to court in a class-action suit contending that the business’s financing practices enable dealers to discriminate against minorities.
A federal judge in Nashville will begin hearing a case on Tuesday that accuses Ford dealers of discriminating against minorities by tacking on additional percentage points that raise the overall interest rate on their loans in the first trial over discriminatory practices in auto lending.
The difference or split it with the lender in the practice, known as markups, dealers charge an interest rate higher than a lending institution would offer and either pocket. Solicitors for the plaintiffs stated studies have shown that minorities in many cases are susceptible to greater markups than nonminorities.
Ford engine Credit isn’t the very first loan provider to be accused of indirect bias whenever lending cash to minorities. The financing divisions of General Motors, Nissan and Honda have all settled suits that are similar they went along to test, since have other financing organizations.