Buy-here, pay-here lender DriveTime Automotive Group Inc is offering a radical new leasing product, which, it says, will allow customers to end their contracts early.
Called “Cancel Anytime,” the new leasing program offers 30-month contracts that allow customers to make a down payment — typically under $1,000, according to DriveTime — with the option of canceling anytime without a penalty, the company says.
Customers enrolled in the program can drive up to 24,000 miles per year and are given a warranty with the vehicle, according to a DriveTime press release.
Customers may want to read the fine print, however, due to DriveTime’s compliance history.
In late 2014, DriveTime was ordered to pay an $8 million civil penalty by the Consumer Financial Protection Bureau for allegedly making what the agency called “harassing debt collection calls” and providing inaccurate information to credit reporting agencies. The agency also ordered the company to take corrective actions, including free credit reports for the impacted consumers.
DriveTime works in the deep subprime space with credit-impaired customers, which is what makes a leasing product such as this a surprising offering.
“We understand the financial challenges that face American consumers today, and are dedicated to providing transportation to anyone, no matter your credit score,” Chris Braddock, vice president of DriveTime, said in the release. “By giving greater flexibility with our lease program, we are able to better serve our customers, giving them access to a vehicle on their own terms, so that they can experience many of the same benefits of vehicle ownership, without the drawbacks.”
DriveTime is offering the program at 126 dealerships across the United States. DriveTime says it has been testing out the Cancel Anytime program for more than a year.
