CFPB: 1,585 Auto-Finance Complaints Registered Since March 2012
Since last March, consumers have registered 1,585 auto finance-related complaints with the Consumer Financial Protection Bureau, according to information the agency made public yesterday.
Of those complaints, 309 related to loans and leases were settled with some kind of respite for the consumer, while 105 received monetary reparation. These are just a small portion of 30 million annual auto finance transactions, according to the National Automobile Dealers Association.
This first auto finance data release comes on the heels of the CFPB’s guidance bulletin released last week regarding indirect auto lending, the first official move the agency made in the sector, and is further proof the CFPB is ready to patrol the space.
Aside from buy-here, pay-here outlets, dealerships are exempt from the Dodd-Frank law that created the CFPB in July 2011. However, dealers will be affected by the possibility of looming lawsuits from the agency, in which it may aim to sue several banks about practices that gave higher interest rates to minorities.
“By sharing these complaints with the public, we are creating greater transparency in consumer financial products and services,” CFPB Director Richard Cordray said yesterday during a field hearing in Iowa. “The database is good for consumers, and it is also good for honest businesses.”
Consumer Bankers Association President Richard Hunt disagrees, saying in a statement, “A better service to consumers would have allowed for collaboration between the CFPB and financial institutions to determine if a complaint is indeed valid, prior to publication.”
Complaints ranged from late fees, vehicle repossessions, alterations made after transactions closed, trade-in payments, false advertising and more, according to a different report the CFPB released yesterday. The information showed that 31 complaints have not been answered, 974 were closed with a reason given, and 83 were closed with no explanation on the outcome.
Lender response was debated in 354 cases, and the report named those institutions that have garnered the most complaints since March 1 of last year:
Wells Fargo: 329
Santander Consumer USA: 166
Capital One: 157
JPMorgan Chase: 130
Ally Financial: 112
According to Experian Automotive, Wells Fargo is the nation’s largest auto financier, with 6% marketshare. The auto finance arms of Toyota, Honda, and Ford, which are also in the Top 10, registered 27, 28, and 21 complaints, respectively.
The CFPB did not release specifics of individual grievances for privacy reasons.
