The CFPB recently issued the following notice: Federal Register This indicates that the agency is seeking approval from the Office of Management and Budget (OMB) to collect additional auto finance data under the agency's authority under the Dodd-Frank Act.
In February 2023, the CFPB announced that it had issued market surveillance orders to nine major auto finance companies seeking information about their auto loan portfolios. The CFPB has published sample orders on its website.
Requests within the order sought detailed loan-level data regarding originations and servicing from January 1, 2018 to December 31, 2022. For example, the origination section asked for data in 23 different categories (and subcategories) regarding vehicle prices and loans. Conditions and other 23 categories of data about dealers, lenders, and borrowers. The Services section included requests for 28 different data categories related to seizure and voluntary surrender, among other requests.
In its new request notice to OMB, the CFPB refers to the February 2023 order as the “Initial Auto Finance Data Pilot” project (Pilot). The report states that data from the pilot will be used to fully carry out the CFPB's mission to monitor the auto financing market for risks to consumers, and to inform the CFPB's proposed approach. stated that they have identified the benefits of additional data collection. We will collect data in the future.
The CFPB currently proposes collecting data through two processes:
- An annual collection of data from lenders that originated more than 20,000 auto loans in the previous calendar year. Data collection reflects data collected in the pilot.
- An annual collection of data from lenders that provided more than 500 but less than 20,000 auto loans in the previous calendar year. The data collected includes information on the number of repossessed vehicles and the number of loan modifications.
As the CFPB noted when it issued its first market surveillance order last year, the CFPB is particularly concerned with the rise in vehicle prices in the subprime and deep subprime market segments and the resulting increase in loan amounts, monthly payments, and delinquencies. The focus has been on growth.
This type of data collection typically results in the publication of a report that is a precursor to new guidance or rulemaking. The CFPB is likely to face opposition from industry to new data collection.
