2. NADA Pushes Back on $945B Dealer Loans

Wall Street Journal

Speed Read:

Respond­ing to pres­sure from increas­ing scruti­ny from the CFPB, NADA has final­ly respond­ed with a 20 Guide­lines on how to ward off the Fed’s inter­ven­tion.

Rec­om­mend­ed deal­ers set a stan­dard inter­est rate to be mod­i­fied only for spe­cif­ic rea­sons, includ­ing com­pe­ti­tion.

The Drill-Down Details:

  • NADA is rec­om­mend­ing changes in how auto loans are done
  • Poten­tial Reg crack­down has prompt new loan stan­dards by deal­ers
  • Deal­ers encour­aged to set loan stan­dards, but can meet com­pe­ti­tion
  • NADA and deal­ers think they found a way to deal with CFPB con­cerns
  • Deal­ers would have less author­i­ty to deter­mine such charges
  • Rec­om­men­da­tions could raise the cost of inter­est for minori­ties
  • 20 pages of detailed guide­lines seeks to reduce the risk of dis­crim­i­na­tion


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