A car dealership in New York. More people are borrowing money against their cars, sometimes to devastating effect.It is a tempting offer: Convert that beaten-up car in the driveway into hard cash with a simple loan.

But car title loans, which allow owners to borrow money against their cars, are having devastating financial consequences for a growing number of Americans who don’t realize how much they truly cost. As the loans proliferate, regulators are beginning to crack down on them.

The Federal Trade Commission took aim at two car title lenders on suspicions that they misled borrowers by failing to accurately disclose the terms and costs of the loans. On Friday, the agency announced that it had reached a settlement with the two lenders, First American Title Lending and Finance Select, which are based in Georgia. The agreement requires the companies to overhaul how they advertise and promote their loans.

“This type of loan is risky for consumers because if they fail to pay, they could lose their car – an asset many of them can’t live without,” said Jessica Rich, director of the agency’s Bureau of Consumer Protection.

Neither company returned calls for comment.

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