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    AFSA Summer Webinars + New Recordings

    So far in the first half of 2018, AFSA’s popular Webinar Series has hosted 10 webinars on a broad range of topics relevant to the consumer credit industry.

    AFSA’s Webinar Series calendar is open for July, which is the perfect time to catch up on any webinars you may have missed this year.  AFSA’s Webinar Resource Center features recordings and materials from all of our past presentations. Check them out today!

    Our upcoming webinars include:

    AUGUST 8 | Situational Awareness & the Regulatory Landscape, presented by LenderLive on August 8, This session will take a look at the latest regulatory issues facing the auto finance industry and explore case law developments regarding the Servicemembers Civil Relief Act (SCRA), including wrongful repossession, lease termination and military lending.

    AUGUST 22| Join Dimont for Asset Protection & Monitoring Best Practices. Establishing the right processes and procedures for collateral protection and monitoring can save lenders losses on their portfolio. This program we will outline steps to ensure successful collateral protection.

    New webinars and topics are added constantly, so be sure to check the Webinar Resource Center for the most up-to-date program schedule. To pitch a topic for a future AFSA Webinar, contact Dan Bucherer.

    AFSA Comments on Legislation Affecting Floorplan Lending

    On June 25, AFSA submitted a comment letter to the California Assembly Committee on Banking and Finance in opposition to Senate Bill 1235, which would create a new set of disclosures that commercial lenders would be required to provide borrowers at the time credit is initially offered. Though AFSA members primarily offer consumer credit, many member companies also provide financing to commercial entities, which includes regularly engaging with automobile dealers to provide them with floorplan lending necessary to enable these dealers to acquire their inventories of vehicles. The bill was scheduled for consideration at a hearing later that day.

    AFSA Comments on the Bureau’s “Inherited Regulations”

    AFSA submitted a comment letter on June 25 on the Bureau’s inherited regulations. As part of its “call for evidence,” the Bureau of Consumer Financial Protection sought comments and information to assist it in considering whether it should amend the regulations or exercise the rulemaking authorities that it inherited from other federal agencies. Under the acting director, the Bureau is critically examining its policies and practices to ensure they align with the Bureau’s statutory mandate.

    AFSA’s comment letter focused on the Equal Credit Opportunity Act (ECOA); debt collection; unfair, deceptive, or abusive acts or practices; and electronic disclosures. The letter stated, “We hope that the Bureau: recognizes that the disparate impact doctrine is not applicable under the ECOA, modernizes and clarifies certain provisions of the [Fair Debt Collection Practices Act], provides meaningful guidance as to what constitutes an ‘abusive’ act or practice, and reviews regulations regarding electronic disclosures."

    Study Finds Consumers Prefer Flexibility of Car Ownership

    If it seems like conventional wisdom is predicting that the U.S. car market in the not-too- distant future will be dominated by autonomous vehicles, electric vehicles and ride-hailing services, a recent consumer study commissioned by the National Automobile Dealers Association (NADA) says otherwise.

    According to a survey of 1,200 consumers conducted by Luntz Global, consumer demand for owning vehicles remains strong across all demographics.The study responded to recent reports from Wall Street analysts and others saying that the emergence of ride-hailing services like Uber and Lyft, combined with the prospect of electric and autonomous vehicles, will dramatically reduce the number of personally- owned vehicles in the future.

    “Consumers overwhelmingly prefer the freedom and flexibility of owning a personal vehicle to ride-hailing services,” Jonathan Collegio, NADA’s Senior Vice President of Public Affairs, said at last week’s annual AFSA/NADA Forum. “This sentiment cuts across all demographics. Ride-hailing will continue to supplement personal vehicle ownership going forward, but will not supplant it.”

    One of the key findings from the study shows that 89% of the respondents said they would rather continue owning a car, versus 11% who said they would prefer using ride-hailing services as their primary source of personal transportation. This sentiment is overwhelming even among millennials, who prefer vehicle ownership by an 80-20% margin. Importantly, millennials in the suburbs or rural areas were six points less interested in ride-hailing than their urban counterparts.

    “Other highlights of the study include:

    • Consumers overwhelmingly view vehicle ownership as convenience, not a cost-drag or nuisance to own, as several studies suggest. Only 6.5% of consumers in the survey viewed owning a car as a hassle or costly nuisance.
    • Consumers view wait times as a significant drawback of ride-hailing services. More than 88% of consumers said they would need to save at least $15 per day to incur an hour of aggregate waiting for ride-hailing services over a day. Half of consumers in the survey said they would need to save $50 per day to incur an hour of aggregate waiting time.
    • Consumers are generally open to autonomous vehicle technology. 56% of consumers said they would purchase a fully or highly autonomous vehicle, while 44% said they would not.
    • Consumers by an 80-20 margin would prefer to capture 80% of the safety benefits from semi-autonomous vehicles they can still drive, as opposed to 100% of the benefit from fully autonomous, driverless vehicles.

    “As an industry we have to understand our customers,” Collegio said. “And as the industry plans for the future, we hope analysts will more deeply study and investigate how consumers use, value, and enjoy relying on their personal vehicles.”

    State AGs Monitoring Federal Rollback in Regulations

    While the auto finance industry made certain legislative and regulatory gains dating back to late last year on the federal level, it continues to be an industry regulated in all 50 states, relying on its compliance departments for expert guidance in navigating state rules and regulations.

    Last week at the AFSA/NADA Forum, Danielle Fagre Arlowe, AFSA’s Senior Vice President for State Government Affairs, reported that several state attorneys general and state legislatures are taking steps to pick up the slack where they feel the Bureau of Consumer Financial Protection (BCFP) and the Trump Administration may be pulling back.

    For example, Pennsylvania Attorney General Josh Shapiro established a mini-BCFP as part of his office and bought in four former BCFP staffers who worked under former Director Richard Cordray at the Bureau.

    Maryland’s legislature is concerned with federal rollback and is monitoring changes in federal law as a way to propose counter changes to existing state consumer protection laws. The Maryland legislature has created the Consumer Financial Protection Commission.

    The Tennessee Attorney General’s office, under Herbert Slattery, is growing its consumer protection division and has hired an attorney to deal with consumer issues, especially in the area of automotive guidance. The AG’s office enforces the Tennessee Consumer Protection Act.

    Phil Murphy, the first-term governor of New Jersey had, as part of his platform, a state CFPB office attached to the Attorney General’s office. In New Jersey, the AG is appointed by the governor, unlike other states where the AG is an elected position.Recently the state AGs who are Democrats sent a letter to Congress urging it not to vote for the joint resolution effectively repealing the CFPB’s 2013 auto guidance. The joint resolution passed in both houses and was signed by President Trump.