2015 GNYADA MEMBERSHIP DIRECTORY

HOT TOPICS 2015 GNYADA Membership Directory

NADA RELEASES FAIR CREDIT COMPLIANCE PROGRAM FOR DEALERS

NADA has led the charge in defending the dealer-assisted financing model, and is working to prevent the adverse consequences that government-imposed flat fees would cause for consumers, dealers and finance sources alike. To help dealers, NADA has prepared educational resources to strengthen their efforts to comply with fair credit laws. This publication provides essential background on this issue, sets forth a fair credit compliance programtemplate that a dealer can adopt, and contains both general and specific instructions for completing the program template. Among many other features, the program template (a) sets forth a fair credit policy that states the dealer’s unambiguous commitment to fair credit compliance; and (b) establishes a voluntary standardized method for determining the amount of dealer compensation that may be earned in a credit transaction.

The compensation method is based on one that was adopted by dealers to resolve Department of Justice allegations of unintentional credit discrimination. It generally involves establishing a set amount of dealer participation that a dealer adds to a buyrateandonlydeviatingfromthat amount if certain pro-competitive factors that are unrelated to the consumer’s background are present in the transaction and are properly documented. Dealers can access a PDF of the NADA Fair Credit Compliance Policy & Program at www. nada.org/regulatory_affairs/ faircreditlanding

Thank you to NADA for this article.

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