GNYADA November 2016 Newsletter

F&I Compliance Tip: Save Your “Pencils” 10 AlliedMember Memo

attorneys that all relevant specifics were explained to the customer, as their deal progressed. Deal Jacket Best Practices Consistently use a “first pencil”. This hypothetical payment and rate sheet reflects the average financing terms for most customers, and is an important demonstration of the process' starting point. The customer sees what the baseline payment figure is, prior to any customization based on their credit and lender responses. Deal jackets should contain copies of every document given to or received from the consumer. That includes all “pencils”, “four squares” and other informal documents illustrating how the deal was formed. This approach demonstrates how the deal

unfolded and is an important step towards transparency.

A “pencil” is a proposal that a salesperson uses with buyers, to outline deal scenarios on the way to the final agreement. To help with F&I compliance, dealerships should automatically save records of these “pencils”, in every customer’s deal jacket. Why it Matters The Dodd-Frank Act of 2010 added a new category of “abusive” trade practices that could take advantage of a customer’s lack of understanding. Furthermore, the Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB) have emphasized the need for transparency in consumer financing of automobile purchases and leases. Saving “pencils” can be a valuable tool in preventing misunderstandings, and (if needed) proving to auditors, regulators, or

Put all deal information in one searchable and secure location. The benefit here goes beyond mere convenience. Being consistent in storage and security provides peace-of-mind and creates efficiencies, just in case auditors come calling. This article was contributed by Dealertrack, a provider of digital solutions in automotive retail, and a GNYADA Allied Member. Dealertrack, a Cox Automotive brand, helps dealerships defend against potential loss, protect customer information and maintain compliance with federal and state regulations. For more inform- ation about the F&I compliance solutions offered by Dealertrack, please contact the Association.

21st Century Data Storage for Dealers 11

and use at AutoTrieve.com . Data is automatically backed up, and backup disks are provided monthly. To learn about AutoTrieve or to schedule a demonstration, please contact Jennifer at the Association: Jennifer@gnyada.com.

discount. For optimal convenience, they offer two data storage options:

Dealerships can do their document scanning and archiving in-house. (Rates are between $619 and $659 per month, based on equipment rental.) or: AutoTrieve can pick up documents from the dealership and do the scanning and archiving work at their New Jersey headquarters. (Rates are 50 cents per Repair Order or three dollars per Deal Jacket.)

All dealership departments generate their share of sensitive paperwork, and the safe storage of these documents is crucial. Now, GNYADA members have access to secure, inexpensive document archiving, through our new Dealer Discount Club (DDC) vendor, AutoTrieve. AutoTrieve's web-based document scanning service can be securely accessed 24/7. As a DDC vendor,

their services are available to GNYADA Members at a 25%

Documents are stored safely for the dealership’s exclusive online retrieval

Greater New York Automobile Dealers Association • www.gnyada.com

The Newsletter • November 2016

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