ARTICLE | April 22, 2022 | Authored by RSM US LLP
Auto finance lenders come in many shapes and sizes, giving rise to a complex, dynamic regulatory framework. While indirect auto lending has long been a priority among regulators concerned about fair lending practices, recent CFPB data and enforcement priorities suggest a broader push for enhanced scrutiny. Indicators include:
Given the impact of the pandemic, the increased costs of vehicles and the CFPB’s general push to limit junk fees, the auto lending space is ripe for significant regulatory change and increased enforcement action.
Your auto lending compliance program should include robust monitoring to ensure your risk management efforts are operating effectively and are nimble enough to respond to regulatory change. Factors to consider include:
Auto lenders should look to enhance compliance monitoring to account for ongoing regulatory changes. Additionally, it’s important to rightsize your compliance program to fit the unique needs of your business. Working with a partner that can improve your compliance risk assessment, review your relationships with third-party vendors, and provide data and analyses around your auto lending operations can help tremendously in navigating the auto lending compliance landscape.
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This article was written by Pete Hoglund, Courtney Nowlan and originally appeared on Apr 22, 2022.
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