These transactions may be direct loans, indirect loans, or floor planning of automobile dealers’ inventory

22. Automobile loans. The principal area in which Section 7 violations are apprehended is that of lending money on the security of automobiles.

The plaintiff would have the court consider all these transactions as portions of the same line of commerce, and lump all competitive and statistical factors into one overall economic category. The defendants would have the different segments of the automobile loan business identified by their various characteristics, and would analyze the competition or possible competition for each segment on its own merits.

If neither bank nor captive finance company will handle the transaction, he then must turn to an independent finance company such as American

A direct loan is a loan direct from the lender to the borrower upon the security of an automobile or other property.

An indirect loan is a loan from the dealer to the customer which is in turn discounted by the dealer with a bank, a manufacturer’s “captive” finance company or an independent finance company like American Credit Corporation. Read more