The Consumer Financial Protection Bureau just unveiled an “auto loan shopping sheet,” the bureau announced yesterday. The new step-by-step guide was accompanied by other online resources as part of “Know Before You Owe” initiative designed to assist consumers in their auto loan shopping experience, according to a press release.
The portal to the worksheet is already live and ready for perusal here.
The “Know Before You Owe” (KBYO) initiative’s itemized shopping sheet enables consumers to see the total cost of a financing venture, and enhances the decision process by providing a comparison between loan products, according to the release.
“Consumers should feel like they are in the driver’s seat when it comes to financing their car or truck,” CFPB Director Richard Cordray said in the release. “The CFPB’s auto loan shopping sheet provides a roadmap for consumers to navigate the complexities of a loan. Consumers should know before they owe when it comes to the total cost, not just the monthly payments.”
Auto loans are the third largest category of household debt for American consumers, just under mortgages and student loans, according to the release. There are almost 100 million auto loans outstanding totaling more than $1 Trillion.
This latest initiative comes on the heels of the CFPB’s proposed rule requiring lenders ensure consumers have the ability to repay their short-term loans. Single-payment auto title loans are only one form of payday loans, and require a vehicle title as collateral, generally with a percentage rate usually around 300%.