Dealers should be wary of an agency given more authority over dealer-assisted loans

Article by Christian A., on May 23, 2011

Dealership advocates said that even if the dealers had been granted an exemption last year from more stringent federal oversight of consumer financing, they should still be cautious of an agency that has more authority over dealer-assisted loans.

As part of the government agency revamp, the U.S. Federal Trade Commission got streamlined rule-writing authority. This means that the agency has an easier time of establishing standards.

Last April, the FTC started to gather dealership-finance information in a roundtable composed of dealer advocates, consumer activists and state regulators. Consumer activists asked for a flat fee to replace interest-rate markups on car loans.

Meanwhile, others aimed for an improved FTC enforcement of government ban against dealer abuses. Several dealer advocates expressed their worries that that those requests might be granted. Dave Robertson, executive director of the Association of Finance & Insurance Professionals, said that the worst-case scenario would be that the apprehensions would lead to more regulation.

The FTC has yet to disclose its intent but Robertson is concerned that the commission will suggest flat fees instead of rate markups. Robertson added that possible FTC proposals may include a flat fee of $100 to $150 a transaction or a ceiling on interest rates.

The National Automobile Dealers Association couldn’t be sure of what will happen to the commission. NADA spokesman Bailey Wood said that it’s better to ask FTC directly; however FTC lawyer Ronald Isaac said that no decisions have been made.

Topics: dealer

If you liked the article, share on:

Comments

Recommended

There is definitely a second-generation Super Series from McLaren. Even in camouflaged form, it is simply incredible. But while we still don’t have the full data on how truly dynamic...
by - February 25, 2017
A lot of fans are excited with the news that Porsche could be unveiling a performance version of its Panamera 4 E-Hybrid plug-in hybrid during the 2017 Geneva Auto Show. ...
by - February 25, 2017
Tesla is finally setting a more “definite” schedule with regards to the official launch of the Tesla Model 3 electric car. A “limited production” is said to be slated to...
by - February 25, 2017
Are you a big fan of legendary boxer Mike Tyson, the former heavyweight world champion? Or are you a big fan of the iconic Ferrari F50? Either way, you will...
by - February 24, 2017
It seems that AM-RB 001 hypercar is not the only vehicle project that Aston Martin and Red Bull Racing has gone into. This time, don’t expect something as outlandish as...
by - February 24, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries