Today, the CFPB released guidance regarding vehicle repossessions entitled Bulletin 2022-04: Mitigating Harm from Repossession of Automobiles.

While the guidance does not reflect a broad brush change in policy, the commentary surrounding the Bulletin does bear noting for several reasons.

First, the Bureau is clearly demonstrating that it has very little tolerance for error, human or otherwise.  AFSA members share a commitment to serve their customers with respect and an understanding that there are times when a customer’s financial circumstances may change. This commitment has been evident in perhaps a more visible way over the past 24 months, when our vehicle finance members worked with hundreds of thousands of their customers to ensure they had both access to their vehicles and the financial flexibility necessary to navigate the economic disruption brought on by the pandemic.

Second, the Bureau is labeling common practices specifically authorized by state law, as illegal. An example: a storage fee for personal items left in a vehicle that has been repossessed.  One can debate the fee itself, but to term it illegal or to compare it to a “ransom” is irresponsible and unfair.

Third, and related to the prior two points, is the overall tone of the CFPB’s bulletin and its portrayal of the industries that it oversees. For example, CFPB Director Rohit Chopra asserts that auto lenders “might be tempted to seize vehicles for resale in the hot used car market.” To more than imply that the motivations of lenders to repossess vehicles are less than legal if not ethical is unhelpful. Unsubstantiated assertions like that from a regulator are also misleading for the media, dangerous for consumers, and indicate a prejudiced view of the industry the CFPB must work with on a host of issues important to the American economy and consumers.

That said, AFSA remains committed to working with the CFPB and other stakeholders to shape pro-consumer policies, and correct mischaracterizations of a consumer credit industry that is vital for the U.S. economy and for American consumers.