Bree: It depends on what state you live in and what state's law controls the financing contract. Most of these financing agreements arise out of other states (even if you sign it in your state) and under most circumstances they will be structured in such a way as to allow the finance company to use the maximum interest rate from that state. Obviously the finance companies chose to structure the agreements in such a way as to allow them to charege the highest rate possible. Texas, for example, allows interest rates of up to 27% on used car loans. Here is a good guide for how to find a car loan with bad credit:
If you feel you are being overcharged, you should speak to a local attorney and show him or her your actual agreement. Only personal counsel and advice from your attorney can tell you whether your agreement is legal. This information is provided for general information purposes only and is not intended as legal advice. Good luck!