The Consumer Financial Protection Bureau is proposing an annual auto finance data collection initiative that would include details such as the margins dealerships applied to indirect loans. The proposal comes a year after the bureau surveyed nine large auto lenders in a pilot.
“The data collected as part of the Auto Finance Data Pilot project both confirmed the benefit of additional data collection to fully carry out the CFPB’s mission, to fulfill the CFPB’s mandate to monitor the auto finance market for risks to consumers, and to inform the way the CFPB would propose to collect data in the future,” the agency wrote in a Jan. 23 request to the U.S. Office of Management and Budget to approve broader research.
A representative of an auto finance trade group called collection of loan-level data unnecessary for the CFPB to do its job and a potential burden on lenders’ time and resources.
The CFPB has proposed collecting scores of data points on all loans from all lenders writing more than 20,000 auto loans in a year and conducting a more limited survey of companies writing 501 to 19,999 loans a year. The agency said lenders with precisely 20,000 loans would receive the more in-depth survey. It also noted “these thresholds are subject to change based on comments received during the process and continued internal deliberation.”
Four thousand companies would be polled if the full survey were approved, the CFPB estimated.
Under the plan, lenders with smaller volume would be asked annually about the number of vehicles they repossessed and loans they modified. The larger lenders would need to complete the more extensive set of questions the agency asked the nine pilot companies in February 2023.
Read the full article at Automotive News