The National Automobile Dealers Association has political muscle, and it was not afraid to use it to get the highly sought-after auto dealer exemption from Consumer Financial Protection Bureau oversight. Bailey Woods, spokesman for NADA, told Automotive News that Congress is headed in the right direction if their aim is to conserve dealers administrative headaches and save consumers money. Considering what NADA lobbyists have won so far, auto dealers appear to have good reason to celebrate.
Post resource: Congressional committee agrees on auto dealer exemption by Car Deal Expert
A victory for auto dealer exemption
The CFPB could have jurisdiction over mortgages, credit cards and other varieties of consumer credit like payroll loans, but the auto dealer exemption will leave dealer financing out of the new government agency’s hands. Car dealer financiers who help dealers provide auto loan financing in-house will remain under CFPB supervision; the dealers who help consumers arrange financing will not. The FTC will continue to have jurisdiction over auto dealers, but their governance has proven ineffective within the estimation of some members of Congress (legislative action can take eight years). The rule system governing the FTC is much more involved the rule set to which other government agencies must adhere, which may explain the inefficiency of the former.
Rep. Barney Frank bemoaned the lack of votes
Rep. Barney Frank and a spate of House Democrats had hoped to curtail auto dealer lending, as did the president, the Pentagon and others, reports Automotive News. Yet NADA’s lobbying turned things around for auto dealers, particularly considering where the finance bill began. All that the organization got for their trouble was a concession that the FTC could speed up their standard-writing process for auto dealers. Yet in spite of this, some consumers may nevertheless be subject to those practices of dealer finance that have been labeled less than reputable by some. Auto dealers claim this is merely than making ends meet in a tough economy.
A lot more information about this topic at these websites:
http://www.autonews.com/apps/pbcs.dll/article?AID=/20100625/RETAIL07/100629912/1128
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