Senate takes first step in disapproving CFPB vehicle finance guidance April 19, 2018 The Senate yesterday approved S.J. Res. 57 by a 51-47 vote. The vote on the resolution, under the Congressional Review Act (CRA), disapproves of the Consumer Financial Protection Bureau’s (CFPB) 2013 vehicle finance guidance. “The vehicle finance market in the United States is a highly-competitive market which benefits consumers as dealers and lenders discount pricing and loan rates to sell and finance new and used vehicles,” said Chris Stinebert, President & CEO of the American Financial Services Association. “The Senate’s vote is in the best interests of the car-buying public.” The CFPB’s vehicle finance lending policy, issued in 2013 through guidance rather than standard regulatory rulemaking, directed fundamental market changes to the industry which was already regulated by other federal agencies and state laws and regulations. Unlike regulations from other federal agencies, the CFPB’s auto guidance was issued without any public comment, consultation with other federal agencies, or transparency. AFSA said many of its member companies worked hard to address concerns the CFPB had. “We are in the process of evaluating the implications the vote has on our members and how to move forward,” said Bill Himpler, Executive Vice President of AFSA. On the floor of the Senate Tuesday, Senate Banking Committee Chairman Mike Crapo (R-Idaho) noted AFSA’s concerns on the impact of the CFPB guidance on consumers. “The American Financial Services Association says the guidance is harmful because of the pressure it puts on vehicle finance companies to limit a consumer’s ability to receive discounted auto loans from dealers,” he said. “It threatens to raise credit costs and push marginally credit-worthy consumers out of the market.” With the passage of the resolution in the Senate, action will shift to the House and the companion bill H.J. Res. 132, introduced by Rep. Lee Zeldin (R-NY), which only needs a simple majority to pass.. AFSA’s expectation is that the resolution will pass that chamber and be on the President’s desk for signature in relatively short order. Proponents of S.J. Res. 57 note that it preserves fair lending protections and does not hinder enforcement of fair lending laws or regulations such as regulated entities ’obligations under the Equal Credit Opportunity Act (ECOA).