Honda dealer accused of negligence in 2 more lawsuits for approving loans for allegedly unqualified customers

By Kyla Asbury | Apr 8, 2019

BECKLEY — John Howerton Honda has been named in two more lawsuits alleging it was negligent in allowing vehicle sales to go through that should not have.

The subjects of one lawsuit are Asia Brown and Melody Brown; the second lawsuit involves Shanda Brown. Both transactions for new vehicles were handled by John Howerton Honda, according to two lawsuits filed in Raleigh Circuit Court.

Asia Brown had purchased a 2014 Hyundai Elantra from John Howerton Honda in July 2015 and in October 2015 she was involved in a wreck and the car was damaged. Asia Brown then discovered that John Howerton Honda had failed to ensure that appropriate coverage was provided on the vehicle and she only had liability coverage. Asia Brown contacted John Howerton Honda about the issue and went in on Dec. 5, 2015, with her mother, Melody Brown.

Asia Brown claims John Howerton Honda approved the purchase of a 2013 Hyundai Elantra and dealt with three salespersons employed by Top Gunz Marketing who also acted as finance and insurance agents for Top Gunz on Howerton's behalf. John Howerton Honda knew or should have known that the plaintiffs were generally unsophisticated in the purchase of an automobile and automobile financing, according to the suit.

The salespersons submitted an online credit application to Santander Consumer USA (SCUSA) and SCUSA agreed to purchase the retail installment sales contract (RISC) for the plaintiffs' purchases, according to the suit, but at no time was Asia Brown or Melody Brown able to review the sign the application.

The paperwork was then "hurriedly signed without any explanation to the Browns," and was done so as part of a scheme to conceal the true cost of the transaction and to conceal that Melody Brown was the actual buyer of the vehicle and Asia Brown was the co-buyer, according to the suit.

The plaintiffs claim SCUSA never sought to confirm their incomes or other information that was provided by the salespersons. Later, they discovered that the salespersons used false information when submitting the loan applications. Later, Asia Brown and Melody Brown discovered the vehicle was financed at 25 percent interest for 72 months with a monthly payment of $350.76.

In Shanda Brown's suit, she claims she went to the dealership in July 2015 to purchase a 2014 Hyundai Elantra and informed the sales staff that she could not spend more than $300 to $350 per month on her car payment. She provided several pay stubs to verify her monthly income. 

The payments on the vehicle ended up being more than $400 per month and when Shanda Brown objected, she was told she could refinance the loan after several months to get a lower payment, so she agreed to purchase the vehicle.

Shanda Brown later discovered she could not refinance the loan. 

In 2017, SCUSA entered into settlements with the Maryland and Delaware attorneys general regarding unfair, high-interest rate loans to people who could not afford the vehicle purchases, according to the suits. John Howerton Honda allegedly failed to tell the plaintiffs they were not eligible to purchase vehicles without the submission of false information to SCUSA and the manipulation of the terms of the sales, according to the suits.

John Howerton Honda is accused of negligence and violating West Virginia code, according to the suits.

The plaintiffs are seeking compensatory and punitive damages. They are represented by Paul Roop II of Roop Law Office.

Howerton has been named in more than one dozen lawsuits alleging similar claims over the last year.

Raleigh Circuit Court case numbers 19-C-32, 19-C-33

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