In January 2014 AIADA, along with the National Automobile Dealers Association and the National Association of Minority Automobile Dealers released to their members the Fair Credit Compliance Policy & Program. A dealership interested in adopting the program in order to better comply with fair credit laws, should complete the following steps.
1. Create a Fair Credit Policy that states the dealership’s strong commitment to fair credit compliance and consider prominently posting the policy where it can be viewed by both consumers and employees.
2. Create a Fair Credit Compliance Program as described in Steps 3-6 that carries out the Fair Credit Policy. The dealership’s leadership must review and formally adopt the Program.
3. Identify who and what is covered by the Program and the purpose of the Program.
4. Appoint a Program Coordinator (PC) to develop and oversee the Program. The PC should have the necessary time, expertise, and seniority to perform this function.
5. Direct the PC to establish the dealership’s pre-set Standard Dealer Participation Rate (SDPR) and provide that the dealership will only deviate from the SDPR if an allowable business reason exists to include a lower amount of dealer participation in the offer of credit.
- Identify the allowable businesses reasons when the dealership may deviate from the SDPR, such as the need to satisfy a customer’s monthly budget constraint. There are seven reasons that are contained in the DOJ’s 2007 consent orders.
- Require each dealership employee who makes a credit offer to record the SDPR, the final dealer participation rate, and if the two differ, the allowable business reason for deviating from the SDPR.
- Ensure that the PC or his or her designee reviews the form to ensure it was properly completed.
6. Establish the training, oversight, and reporting tasks that the PC must complete to ensure the Program is faithfully executed.