Finance and Insurance Newsletter

LETTER TO THE EDITOR

A role for dealers in lease transfers

12:01 am U.S. ET | June 29, 2015

I read with great interest about James B. Treece's experience in assuming the short-term lease of a Chevy Volt ("Mixed reviews are in after assuming lease for Volt," June 8). I agree with him. Dealers should have a role in the lease-transfer process.... Read More »

EDITORIAL

How dealers can protect themselves from bad actors

12:01 am U.S. ET | June 29, 2015

A blot on auto retailing is developing in Birmingham, Ala. Eight former employees of Serra Automotive Group pleaded guilty to charges including falsifying documents and two managers are accused of cheating on Nissan North America's national sales incentive program.... Read More »

Supreme Court ruling could favor all groups debating bias in auto lending

7:45 pm U.S. ET | June 25, 2015

The Supreme Court's decision to endorse a broad interpretation of a legal theory used to fight housing discrimination provides ammunition for groups at odds over the CFPB's power to pursue discrimination in auto lending.... Read More »

Ford Credit car-sharing plan aims to cut ownership costs

12:15 pm U.S. ET | June 24, 2015

Ford is entering the car-sharing market with a program that will cut Ford Credit customers' vehicle costs by enabling them to rent out their cars.... Read More »

HANNAH LUTZ

BLOG: 3 steps to regulatory compliance

12:15 pm U.S. ET | June 24, 2015

To stay out of trouble with regulators, clean up compliance. It sounds like an obvious solution, but what do dealers need to do to be sure compliance is up to par?... Read More »

NYC dealership must provide documents for non-English speakers

12:15 pm U.S. ET | June 24, 2015

As part of a settlement with the New York attorney general's office, a New York City dealership group must begin providing translations of sales documents to customers who negotiate their vehicle purchases in languages other than English.... Read More »

Lenders stretch subprime auto loans, stoking concerns over consumer debt load

12:15 pm U.S. ET | June 24, 2015

Demand for automobile debt in the U.S. is enabling lenders to make longer loans to people with spotty credit, stoking concern that car shoppers are being lulled into debt loads they won't be able to sustain.... Read More »

CarMax originates $15 million in subprime loans in latest quarter

11:45 am U.S. ET | June 24, 2015

CarMax's finance arm originated about $15 million of subprime loans in its most recent quarter ended May 31. CarMax Auto Finance has originated almost $90 million in subprime loans since it began a test program in January 2014 to learn more about customers that it typically had handed off to subprime lending partners.... Read More »

BB&T launches flat fees

11:45 am U.S. ET | June 24, 2015

Auto retailers working with BB&T Dealer Finance soon can expect to be paid flat fees, rather than dealer reserve, for arranging customers' loans. BB&T will launch a nondiscretionary dealer compensation program on July 1.... Read More »

Must dealers steer clear of credit repair?

12:01 am U.S. ET | June 22, 2015

The N.Y. attorney general's office reached multimillion-dollar settlements with some dealerships, saying they sold credit repair and ID-theft products for as much as $6,000 and often without the customer's knowledge. The products in question cost the dealerships $179 or $279.... Read More »

N.Y. targets dealerships' sale of credit-repair, identity-theft products

12:01 am U.S. ET | June 17, 2015

Paragon Honda and its two sister stores have agreed to a $13.5 million settlement with the New York attorney general's office over the alleged unlawful sale of credit-repair and identity-theft prevention products, part of a broader crackdown on deceptive sales practices by dealerships.... Read More »

Q&A

Why longer loan terms are not a big concern

12:30 pm U.S. ET | June 17, 2015

The average auto loan term on a new car has grown to more than five years. And that has some industry watchers worried that extended loans will keep consumers out of the market longer, lead to negative equity and increase default rates. But Michael Collins, senior vice president of F&I solutions at Dealertrack, isn't concerned that the trend toward longer loans is necessarily putting the market in danger.... Read More »

Lawsuit could test the F&I videotape defense

11:45 am U.S. ET | June 17, 2015

A videotaped closing in the F&I office might be key to a big court case for two dealerships in Alabama.... Read More »

HANNAH LUTZ

BLOG: The advantages for going online with F&I

12:00 pm U.S. ET | June 17, 2015

To reduce the push and pull around F&I product options and avoid surprising consumers with unexpectedly higher monthly payments as F&I products are added on, dealerships should introduce F&I online.... Read More »

JAMIE LaREAU

BLOG: A case for breaking the 300% rule

11:45 am U.S. ET | June 17, 2015

Most F&I folks subscribe to the “300 percent rule”: Offer 100 percent of the products to 100 percent of the dealership's customers 100 percent of the time. But a recent conversation with a friend indicates the rule doesn't apply to 100 percent of cases.... Read More »

Ally boosts nonprime lending, non-GM business

11:00 am U.S. ET | June 10, 2015

Ally Financial Inc. has stepped farther away from General Motors in recent months, increasing nonprime lending and doing more business with non-GM brands, Ally CEO Jeffrey Brown said this week. The effort was spurred, he said, after GM made GM Financial its preferred lender for subsidized leases in February, pulling business from Ally.... Read More »

F&I QUIZ

Who's bigger? A lender quiz

8:59 am U.S. ET | June 10, 2015

Here are 10 of the top 20 retail auto lenders in the first quarter as ranked by Experian Automotive. Try to rank them by market share.... Read More »

HANNAH LUTZ

BLOG: Why credit bureaus' loan data vary

11:00 am U.S. ET | June 10, 2015

The three major credit bureaus, TransUnion, Experian and Equifax, publish their auto finance data in spurts throughout the year, usually a week or two apart from one another. But one thing always stops me when reporting the data: The trends are the same, but the numbers don't match up.... Read More »

Auto lenders’ decision times drop

11:00 am U.S. ET | June 10, 2015

The industrywide effort to speed the F&I process is making strides due to a stronger focus on technology, according to results of the 2015 Non-prime Automotive Financing Survey.... Read More »

Echopark stores' iPad strategy reaps F&I results

12:01 am U.S. ET | June 8, 2015

Sonic Automotive Inc.'s three new used-vehicle stores in the Denver area are getting strong F&I results. The three stores together average nearly $1,000 per vehicle on sales of extended service contracts, guaranteed asset protection and other add-on items. That's despite having no dedicated F&I officers and using a one-price, one-salesperson process.... Read More »

JAMES B. TREECE

Mixed reviews are in after assuming lease for Volt

12:01 am U.S. ET | June 8, 2015

After running into title snags and other glitches in assuming an existing lease on a Chevrolet Volt, Automotive News' James B. Treece sees opportunity for dealerships in smoothing lease swaps for consumers. Here is his story.... Read More »

Auto-loan delinquency rates drop to lowest level in a decade

3:58 pm U.S. ET | June 4, 2015

Auto-loan delinquency rates have fallen to their lowest level in a decade, even as high-risk loans continue to rise, a June 4 report said.... Read More »

Average new-car loan hit 67 months in Q1

11:30 am U.S. ET | June 3, 2015

More than a fourth of all new light vehicles financed in the first quarter carried loans of 73 to 84 months, data from Experian Automotive show. The average loan term in the quarter rose to 67 months for new vehicles and 62 months for used, both records. Longer loan terms aren't necessarily a threat to the auto market, but they already are trimming sales, industry experts say.... Read More »

Ally Insurance launches extended service contracts, supporting technology

11:30 am U.S. ET | June 3, 2015

Ally Insurance is rolling out an extended service-contract product paired with a technology platform. The new product line offers three levels of service contracts aimed at new-vehicle buyers who want coverage beyond the standard warranty or buyers of used vehicles seeking coverage. One dealer found the program saved customers 15 minutes in the F&I office.... Read More »

JAMES B. TREECE

BLOG: How credit unions, as a group, will become the largest auto lender

11:45 am U.S. ET | June 3, 2015

Credit unions as a group, largely working through Credit Union Direct’s CUDL platform, are poised to become the largest single lender to auto buyers -- eventually. Here’s how.... Read More »

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