California Dealers Score Legislative Win

By Staff Writer June 23, 2020 503
Assembly Banking and Finance Committee chairwoman Monique Limón Assembly Banking and Finance Committee chairwoman Monique Limón

The California Assembly voted down a bill that would have had a huge negative impact on the state’s auto finance industry.

AB 2501 – the COVID-19 Homeowner, Tenant and Consumer Relief Law of 2020 – was defeated by a 28-25 vote on June 15 and the Assembly adjourned its session without taking up a motion to reconsider the measure.

The bill, sponsored by Assembly Banking and Finance Committee chairwoman Monique Limón, would have prohibited creditors from repossessing vehicles until Jan. 1, 2023, and required them to provide loan forbearance for up to nine months for customers unable to make payments.

Repossessions would have been halted under AB 2501
Repossessions would have been halted under AB 2501

The Independent Automobile Dealers Association of California worked with the National Independent Automobile Dealers Association to oppose AB 2501, noting its passage would drastically reduce the ability of independent dealers and auto finance companies to extend credit to consumers – especially credit-challenged individuals.

“We couldn’t be happier with the actions of the Assembly,” IADAC executive director Larry Laskowski said. ”There really was no upside to the bill. The economic impact would have been enormous. 

“Thanks to the action of IADAC and NIADA and other groups, members of the Assembly were able to make the right choice and defeat this potentially disastrous bill.”

In a letter to Limón and members of the Assembly, NIADA pointed out auto lenders assume significant risk in extending credit, which is minimized only by their ability to repossess the collateral in the event of a default. Without that ability they would be far less likely to provide credit – and those most likely to be harmed by that would be the most vulnerable and financially disadvantaged consumers.

Rate this item
(2 votes)
Last modified on Wednesday, 01 July 2020 15:23

Trending News

NAIAS Shifts to Fall

NAIAS Shifts to Fall

Sep 23, 2020 Rate: 5.00

Agora Partners with Westlake

Agora Partners with Westlake

Sep 23, 2020 Rate: 0.00

KBB Donations Support St. Jude’s

KBB Donations Support St. Jude’s

Sep 23, 2020 Rate: 0.00