Predictions for CFPB actions on auto lending in 2016

Predictions for CFPB actions on auto lending in 2016

These predictions about the CFPB come from Amy L. Hanna, an Atlanta-based automotive attorney with Baker Donelson who has represented a national auto lender against plaintiff lawyersê-inspired consumer claims.

1. The Senate will pass H.R. 1737/S. 2663, the –Reforming CFPB Indirect Auto Financing Guidance Act,” which would require the CFPB to withdraw its guidance on auto financing. NADA, which praised Sen. Jerry Moran (R-KS) for introducing the Senate version, said the original CFPB guidance tries to eliminate a dealerês ability to discount auto financing for consumers. The House passed the measure last year by a vote of 392-96. Hanna said President Obama would likely veto the bill if it passed the Senate, but Congress probably would override the veto.

2. The CFPB will probably issue a proposed rule this year that would limit the use of arbitration clauses in consumer lending agreements. The agency announced its plan last fall to limit arbitration clauses that affect a consumerês right to join a class action suit. Expect a proposed rule in mid- to late 2016. If a final rule limiting the use of arbitration clauses is enacted, it could well go before the Supreme Court later.

3. Look for greater scrutiny of credit reporting. Between November 2015 and January 2016, the CFPB received an average of 3,536 consumer complaints, per month, about credit reporting. Even though that represents a 7% drop from a year earlier, itês still the third most common type of complaint the CFPB receives.