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CFPB outlines auto finance plans

September 20, 2019
While the Consumer Financial Protection Bureau focused supervisory and enforcement activity last year on mortgage lending, small business lending and student loan servicing, it hasn’t forgotten about the auto finance industry, according to the agency’s 2018 Fair Lending Report issued to Congress.
 
The CFPB intends to zero in on "whether there is discrimination in policies and practices governing auto servicing, including the use of models that predict recovery outcomes," the report said.
 
The bureau also intends to scrutinize the Equal Credit Opportunity Act’s disparate impact doctrine. An initial reexamination came last year in response to a 2018 congressional resolution that disapproved of former CFPB Director Richard Cordray’s 2013 guidance on indirect auto lending, which limited the ability of auto dealers to offer auto loans to their customers.
 
In addition, the bureau has encouraged innovations that would "be implemented in a consumer-friendly way to help serve populations currently underserved by the mainstream credit system through alternative credit," wrote Patrice Alexander Ficklin, director of the CFPB’s office of fair lending and equal opportunity.
 
The CFPB estimates that nearly 45 million Americans are "credit invisible," causing them to run into roadblocks when attempting to access credit.
 
 

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