Congress is working on reforming financial oversight in the wake of the sub-prime mortgage meltdown, and if the House and Senate come together on a compromise bill, a new Bureau of Consumer Financial Protection will be created. The House's bill exempted auto dealers from more strict lending scrutiny. As currently written, the Senate's bill includes the 18,000 new car dealers in the United States under its umbrella. There is a non-binding resolution that urges adoption of the House car dealer exemption, and dealers suggest they're already regulated plenty.
As a source of financing, auto dealers work like any other lender, including some scams and shady practices that put people into situations they can't afford or insert hidden fees into fine print. Despite the National Association of Auto Dealers protests that auto dealers are already well-regulated, anyone who's fallen prey to these exploitative lending practices would beg to differ. The fight is not resolved, with Senator Sam Brownback of Kansas arguing on behalf of car dealers on Main Street, and the White House arguing on behalf of consumers. Debate is ongoing, but a vote is expected soon.
[Source: The Detroit News]