Red Rocks Credit Union agrees to refund auto loan customers | Business

Red Rocks Credit Union will issue more than $ 300,000 in refunds after more than six years for property repurchase guaranteed automobile protection payouts, according to Colorado Attorney General Phil Weiser.

Customers can get guaranteed automobile protection (GAP) from their lenders if they have a total car accident.

GAP protection covers the amount of insurance companies will pay, most likely only “fair market value,” and the amount consumers must still pay on those auto loans.

The lender, according to Colorado law, says that any “unearned GAP payments” if the borrower pays off the loan early, or the car is repossessed before the loan is repaid.

In a settlement, Red Rocks Credit Union officials agreed to pay 1,328 customers $ 312,268 – with an 8% interest – for failing to issue those refunds from October 2014 to July 2020, according to a news release.

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“This settlement reflects our office’s efforts to ensure that hard-working customers are not cheated out of money, even by trusted lending firms whose business practices must comply with Colorado law,” Weiser said in the release. “Denying a Consumer GAP Refunds to which they are entitled to unfair and illegal.”

Weiser’s office has secured more than $ 19 million in GAP refund settlements in recent years, including from Wells Fargo, BBVA USA (formerly Compass Bank), Ent Credit Union, Premier Members Credit Union and Credit Union of Denver.

The release alleges Red Rocks Credit Union officials are aware of ongoing investigations and GAP enforcement actions against those competitors and sought to settle “any legal action from the credit union.”

Red Rocks Credit Union officials did not return a call seeking comment from The Denver Gazette.

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