Vote May Occur As Early As Monday, May 17
Issue
The Senate financial regulation bill (S. 3217) would create a Bureau of Consumer Financial Protection (BCFP), which would have new and extremely broad authority to regulate most financial products, including dealer-assisted financing. The auto finance model is sound, based on due diligence, and decreases the cost of credit to consumers. NADA supports an amendment by Sen. Sam Brownback (R-Kan.) to the financial regulation bill. Dealers are already effectively regulated by the Federal Reserve Board, the Federal Trade Commission (FTC) and state consumer protection agencies.
The Brownback Amendment is necessary because the broad authority granted to the BCFP seriously threatens to limit dealer-assisted financing and the convenience and competition this financing offers consumers at all economic levels. Since 94 percent of all vehicle sales in 2008 involved financing, it is essential to preserve dealer-assisted financing and affordable credit for consumers.
Background
The House financial reform legislation (H.R. 4173) which passed in December 2009 included a bipartisan amendment that would not subject motor vehicle dealers (except for “buy here, pay here” financing) to regulation by the proposed Consumer Financial Protection Agency (similar to the Senate-proposed BCFP), but would maintain consumer protection regulations administered by the Federal Reserve, the FTC, and state agencies. This amendment was offered in the Financial Services Committee by Rep. John Campbell (R-Calif.) and passed on a 47-21 vote. An amendment to nullify the Campbell amendment on the House floor was withdrawn.
Key Points
The Amendment Has Bipartisan Support
- Democratic Senators have indicated they would support the Brownback amendment if changes are incorporated ensuring that any financial activity unrelated to automotive retailing by dealers would be regulated by the CFPB. Senator Brownback has agreed to this change and has offered it as a compromise.
The Amendment is Pro-Consumer Because It Keeps Auto Credit Affordable
- Dealer-assisted financing provides more convenience, more competition, and more choices for consumers. Because dealerships have multiple relationships with lenders (community banks, local credit unions, national banks, and captive finance companies), they are able to help find consumers the best rate.
- Consumers can always rely on their own banking relationships, but dealers can regularly meet or beat the bank or credit union rate.
The Amendment Strengthens Consumer Protections
- Under the Brownback Amendment, every auto lender and auto loan would be directly regulated by the CFPB. The banks, credit unions, buy-here-pay-here dealers and finance companies that fund auto loans would be fully regulated by the CFPB. Dealers are not banks. They help arrange financing and help consumers find affordable credit. This competition helps keep auto financing affordable.
- The Brownback Amendment expressly protects all existing Federal consumer protection statutes that govern dealer-assisted financing. Dealers’ retail financing activity would continue to be effectively regulated by the Federal Reserve Board and the Federal Trade Commission and 50 state consumer protection agencies. Dealers would continue to be subject to the full range of federal laws and regulations that currently apply (e.g., Truth In Lending Act, Federal Consumer Leasing Act, Equal Credit Opportunity Act, Fair Credit Reporting Act, Gramm-Leach-Bliley Act, Federal Trade Commission Act, etc.).
Are you looking for things you and your family can do this Christmas season in the Omaha area? If so, you have come to the right place. There are a variety of activities that everybody can enjoy regardless of the amount of time you have. Here are just a few things that will help you appreciate the spirit of Christmas without going far from home.
If you’re looking for something to do the Halloween in or around Omaha, your 