Car sales and financing are about to get more complicated now that the Consumer Financial Protection Bureau (CFPB) is turning its regulatory eye toward the sales of add-on products, two Ballard Spahr attorneys wrote in a Dealer Business Journal article.

Christopher J. Willis and Kristen Rajagopal, consumer financial services lawyers in Ballard Spahr's Atlanta office, wrote that recent comments from the CFPB, as well as the direction of current and historical auto and consumer loan regulation, indicate that the Bureau will likely concentrate on both sales practices and potential disparities in pricing with respect to products such as extended warranties, gap insurance, paintless dent removal, and tire and wheel plans.

"The sale of these products has historically been an important revenue source for dealers, but the coming regulatory scrutiny requires industry participants to act now to protect this line of business from potential disruption," the lawyers wrote. "Luckily, with some planning and documented compliance steps around add-on sales, you can be prepared for what’s coming."

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Consumer Financial Services