Finance and Insurance Newsletter

Fla. M-B dealer e-validates contracts, gets paid fast

12:01 am U.S. ET | Sept. 8, 2014
Mercedes-Benz of Coral Gables rarely has to wait more than 24 hours to be paid by lenders that commit to finance the Florida store's loan and lease customers, said Scott Cooper, the finance and insurance director.... Read More »

 

Dealers prying payments from some lenders

12:01 am U.S. ET | Sept. 8, 2014
Dealers are still seeing big differences in how quickly lenders pay them on contracts in transit, despite awareness and technology campaigns aimed at speeding payments to dealers when retail customers finance vehicle purchases and leases.... Read More »

 

FOILING FRAUD

Phony deals cost dealers reputation, vehicles and lenders

12:01 am U.S. ET | Sept. 8, 2014
For employees in a dealership's finance and insurance office, spotting a potentially fraudulent deal is top priority. A mistake not only can cost a dealership a vehicle, it can hurt the store's reputation and its relationships with lenders. It's a challenge for all dealership groups.... Read More »

 

With digital data, DARCARS has F&I down to a science

12:01 am U.S. ET | Sept. 8, 2014
Finance and insurance managers at DARCARS Automotive Group have a digital Big Brother watching them, ready to spit out a minute-by-minute account of their customer interactions if their sales fumble.... Read More »

 

Auto lenders curb loans to least-creditworthy customers

11:07 am U.S. ET | Sept. 3, 2014
Auto lenders hit the brakes on loans to customers with subprime and deep subprime credit in the second quarter of 2014, according to Experian Automotive. Loans to those customers accounted for 15.1 percent of new-vehicle loans for the quarter.... Read More »

 

JIM HENRY

New rules for asset-backed securities could impact subprime lenders

12:01 am U.S. ET | Sept. 3, 2014
The Securities and Exchange Commission last week laid out new rules for asset-backed securities, the financial practice in which lenders bundle loans and sell them off to investors to raise money to fund new loans.... Read More »

 

Who’s responsible for passing along bad credit info?

12:01 am U.S. ET | Sept. 3, 2014
Will dealerships catch fallout from the Consumer Financial Protection Bureau’s consent order last month with First Investors Financial Services Group? Experts disagree, with some saying no and others suggesting at least indirect implications for dealerships.... Read More »

 

Q&A

Sonic’s EchoPark stores will use self-branded products, financing

12:01 am U.S. ET | Sept. 3, 2014
Sonic Automotive is negotiating with auto lenders and F&I product administrators to provide private-label retail financing and F&I products for its new EchoPark stand-alone used-car dealerships, says Jeff Dyke, Sonic’s executive vice president of operations.... Read More »

 

Santander sued by investors over subprime lending practices

12:01 am U.S. ET | Sept. 3, 2014
A lawsuit seeking class-action status was filed against Santander Consumer USA last week on behalf of investors who claim the lender misled them about the company’s “auto lending business and underwriting practices.”... Read More »

 

JIM HENRY

Is CFPB guilty of spin?

12:01 am U.S. ET | Aug. 27, 2014
Remarks delivered by Consumer Financial Protection Bureau Director Richard Cordray and language used in a bureau statement last week were a lot harsher than the dry legalese of the consent order signed this month by the CFPB and First Investors Financial Services Group.... Read More »

 

Is rise in Q2 loan delinquencies a turning point?

12:01 am U.S. ET | Aug. 27, 2014
Industry-watchers insist that today's auto loan delinquency rates are low by historical standards. But a slight uptick in 30- and 60-day delinquencies in the second quarter could be a sign that the long decline in delinquencies could be reversing.... Read More »

 

F&I departments need a farm team

12:01 am U.S. ET | Aug. 27, 2014
The term “succession planning” is usually applied to dealer principals, but it can apply to F&I managers, too. Executives at two dealerships say store managers should nurture their own talent pool, so they have a ready replacement if a top F&I producer quits.... Read More »

 

'No evidence' of subprime auto loan bubble, Equifax economist says

12:01 am U.S. ET | Aug. 27, 2014
Equifax has joined other financial data crunching firms that dispute there's an alarming subprime auto loan bubble that's about to burst. Dennis Carlson, deputy chief economist for Equifax, said in an interview this week there's an easy tendency to decry subprime in general because of what happened in the past, and "it's not fair to do that.”... Read More »

 

The incentives debate: Who's being 'stupid'?

12:01 am U.S. ET | Aug. 25, 2014
Some big rivals dismiss American Honda sales boss John Mendel's grim warning that extended loan terms and other strategies being employed by competitors hurt resale values, customer loyalty and ultimately profits. So who's right?... Read More »

 

CFPB fines subprime lender First Investors Financial Services Group for sending credit bureaus inaccurate info

12:30 pm U.S. ET | Aug. 20, 2014
The Consumer Financial Protection Bureau fined subprime auto lender First Investors Financial Services Group nearly $3 million for knowingly providing inaccurate information to credit reporting agencies for at least three years.... Read More »

 

JIM HENRY

Did dealers hurt themselves with the carve out?

12:01 am U.S. ET | Aug. 20, 2014
There’s no mistaking that federal regulators are serious about policing auto lenders. By extension, auto dealers feel they’ve got a big target on their backs, too.... Read More »

 

Auto loans could get boost from revamped FICO scores

12:01 am U.S. ET | Aug. 20, 2014
A planned update in the way FICO scores are calculated should help some borrowers qualify more easily for auto loans by putting less weight on overdue medical debt when calculating credit scores, according to Fair Isaac Corp.... Read More »

 

Canadians stretch out auto loans as debt warnings go ignored

5:34 am U.S. ET | Aug. 20, 2014
The average term of a light-vehicle loan in Canada is 69 months, close to a peak of 72 months set in the third quarter of 2013, according to J.D. Power. Longer-term car loans are leaving Canadians in debt for a longer time, analysts say. And the borrowing binge adds to signs Canadians are continuing to buy big-ticket items and tuning out warnings about unsustainable debt growth.... Read More »

 

JAMIE LaREAU

Skipping wheel-and-tire was big mistake

12:01 am U.S. ET | Aug. 20, 2014
Wheel-and-tire insurance is a valuable product. There, I admit it. It's not the “snake oil” that a cynical friend once espoused it and other F&I products to be.... Read More »

 

Asbury targets underperformers, training as F&I gains stall

12:01 am U.S. ET | Aug. 20, 2014
Asbury Automotive Group's improvement in average F&I revenues per vehicle retailed has stalled this year. Like other publicly traded auto retailers, Asbury plans to concentrate on squeezing improvements out of its bottom performers in F&I revenue per vehicle retailed.... Read More »

 

Subprime auto loan growth is 'less pronounced' in context, Fed analysts say

12:01 am U.S. ET | Aug. 20, 2014
While auto lending is rising in all credit categories, subprime auto loans are growing the fastest because that segment dropped the most during the downturn, according to a study by four analysts from the Federal Reserve Bank of New York.... Read More »

 

U.S. Treasury to cut Ally stake

10:56 am U.S. ET | Aug. 14, 2014
The Treasury Department plans to cut its stake in Ally Financial by selling stock on the open market in its first divestiture since the company's initial public offering in April.... Read More »

 

Toyota: Favorable auto finance climate to continue driving U.S. retail volume

12:01 am U.S. ET | Aug. 13, 2014
An auto finance environment favorable to many U.S. consumers will continue to provide a tailwind for higher retail auto sales in 2014, a top Toyota executive said Tuesday.... Read More »

 

JIM HENRY

N.Y. Times' demands are misguided

12:01 am U.S. ET | Aug. 13, 2014
Subprime auto loans have gotten most of the attention, but an editorial in The New York Times on Saturday makes other demands dealers and lenders are sure to dislike.... Read More »

 

NADA, AFSA dispute New York Times editorial on subprime auto loans

12:01 am U.S. ET | Aug. 13, 2014
Auto dealer and lender groups are howling in protest at an editorial in Saturday's New York Times that equated subprime auto loans with subprime mortgages. The groups insist there is no comparison between the two types of loans. At the same time, a recently disclosed U.S. Department of Justice investigation into subprime auto loans is very much part of the debate.... Read More »

 

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