CFPB States Intent To Scrutinize Auto Lender Repossession Practices

On February 28, 2022, the CFPB released a Compliance Bulletin and policy guidance entitled “Mitigating Harm from Repossession of Automobiles.” In its bulletin, the CFPB sets forth the objective of reminding market participants of certain legal obligations under federal consumer protection laws in light of what it perceived to be “risky auto repossession practices.” Per the CFPB, these “risky” practices may have resulted from the strong demand for used automobiles since the start of the COVID-19 pandemic. In its bulletin, the CFPB reminds the auto finance industry that the CFPB “pays particular attention to servicers' repossession of automobiles.” This bulletin represents the latest in a series of public warnings by the CFPB that it is closely scrutinizing industry conduct, especially as it relates to servicing, default servicing, and collections.