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Exception Rate Justification Form anyone??? damn cfpb.

CARBIZ

Getting Refreshed
May 17, 2010
34
19
8
First Name
Evan
Exception Rate Justification Form??? damn cfpb.

Like most of you, over the past 6 months we've received many CYA letters from our lenders stating that they do not condone or permit discrimination practices within there lending nor do they expect their dealers to. This is being done in the wake of all the CFPB mumbo jumbo, obviously. We were also encouraged by our garage insurance company (Zurich) to instate an "Exception Rate Justification Form". An internal form that is meant to justify why you gave customer X a higher/lower rate as opposed to giving them any other rate that you would typically give. Sounds a little silly to me. Has anyone else instituted this form in their operations?
 
Last edited:

Eley Duke

Sr. Refresher
Nov 30, 2009
471
252
93
First Name
Eley
Re: Exception Rate Justification Form??? damn cfpb.

Like most of you, over the past 6 months we've received many CYA letters from our lenders stating that they do not condone or permit discrimination practices within there lending nor do they expect their dealers to. This is being done in the wake of all the CFPB mumbo jumbo, obviously. We were also encouraged by our garage insurance company (Zurich) to instate an "Exception Rate Justification Form". An internal form that is meant to justify why you gave customer X a higher/lower rate as opposed to giving them any other rate that you would typically give. Sounds a little silly to me. Has anyone else instituted this form in their operations?
Yes! We started this first of the year under advisement of our F&I consultant, we use an Allstate rep.

We also use an ECOA (Equal Credit Opportunity Act) Notice with all customers.

And were also advised to adopt, and have in writing, a policy that when allowed a rate mark up we have a set standard mark up for all contracts. We use 2%.

I have also read where several large dealer groups are restricting their mark-ups on F&I products, even in states where it is allowed. Using a standard profit margin and no-haggle approach for all products.
 

CARBIZ

Getting Refreshed
May 17, 2010
34
19
8
First Name
Evan
Re: Exception Rate Justification Form??? damn cfpb.

Thanks for the reply Eley. In my opinion, the form seems a little exorbitant but we are going to institute nonetheless. Not sure if I want to go as far as to limit my profit margins on back-end quite yet!