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Auto lending is a dynamic market second only to housing in size, with nearly $900 billion in outstanding auto loan balances. Banks hold approximately a third of all auto loan balances, followed closely by captive auto lenders, credit unions and auto finance companies. Under the Dodd-Frank Act, the CFPB has the authority to supervise all depository institutions with more than $10 billion in assets. However, the Bureau has also been granted the authority to supervise “larger participants” in consumer financial markets. The CFPB exercised this authority by issuing a rulemaking proposal to extend its supervisory reach over nonbank auto lenders, such as the captives and auto finance companies. CBA is largely supportive of this effort as consumers should expect to receive the same level of protection no matter where they receive their auto loans.
- July 1, 2015The Consumer Financial Protection Bureau remains frustrated that most auto dealers were carved out of the CFPB’s jurisdiction when Congress created the bureau in 2010. The issue came up multiple times in a recent meeting between CFPB Director Richard Cordray and a delegation from the Consumer Bankers Association, said Reagan Anderson, CBA senior vice president for congressional affairs. She...
- June 30, 2015The Consumer Financial Protection Bureau says consumer “narratives” are the “heart and soul” of consumer complaints it receives, but to lenders on the receiving end, the narratives amount to “public shaming,” with no way to adequately respond. Over the objections of trade groups, the CFPB re-launched its consumer complaint database late last week with the addition of consumer narratives, altered...
- June 19, 2015CFPB Issues Mid-Year Update of Student Loan Market On Thursday, June 18, 2015, the CFPB Student Loan Ombudsman issued a Mid-Year Update about complaints received regarding private student loans, and debt collection complaints about federal student loans. The report highlighted lenders policies regarding co-signer release, and found more than 90 percent of consumers who applied for co-signer...
- May 5, 2015“One study estimates that these auto dealer markups cost consumers $26 billion a year. Auto dealers got a specific exemption from CFPB [Consumer Financial Protection Bureau] oversight, and it is no coincidence that auto loans are now the most troubled consumer financial product. Congress should give the CFPB the authority it needs to supervise car loans – and keep that $26 billion a year in the...
- April 2, 2015In five years, the dealership F&I office will no longer exist, at least not in the traditional sense, Peter Grady, vice president of network development for Fiat Chrysler Automobiles, told auto financiers in a session last week at CBA Live.
- April 1, 2015The Consumer Financial Protection Bureau sees the combination of easier credit, a rise in credit losses from historic lows and longer terms in subprime auto loans as an “emerging” risk worth keeping an eye on, said Steven Antonakes, deputy director.
- April 1, 2015When asked which banking product should "die," during a CBA Live debate titled Banking: Live and Let Die , Camden Fine, president and chief executive of Independent Community Bankers of America, answered "long-term, fixed rate loans," adding that 60-month auto loans are too long.
- March 31, 2015The Consumer Financial Protection Bureau has a 'moral obligation' to respond to a study that found its methodology to determine disparate impact in an auto lender's portfolio to be flawed, said Michael Benoit, partner at Hudson Cook LLP, during a CBA Live 2015 session last week.
- March 31, 2015Almost half of all Uber drivers are working only to pay their car loans, according to Gus Fuldner, head of insurance at Uber Technologies, who spoke at CBA LIVE last week. More specifically, "49% of Uber drivers work for the company for only as many hours as it takes to make their car payment, and that's enough for the month," Fuldner said.
- March 25, 2015A shift in consumer behavior is coming for both auto lenders and dealers when dealing with car shoppers in the near future, according to Monica Orluk, director of sales engineering for Fiserv, and Peter Kidd, senior vice president of consumer auto business at Fifth Third Bank. The two spoke at the Consumer Bankers Association Live 2015 conference Tuesday in Orlando, Fl. Many consumers are...