FORT WORTH, Texas — Responses to more than a dozen questions
delivered in advance to an assistant director of the Consumer Financial
Protection Bureau had to be approved by many officials from the new regulatory
agency.

During the keynote session of the NAF Association's 17th annual
Non-Prime Auto Financing Conference, Rick Hackett insisted, "the message is we
try to give you the most accurate information as we can." Hackett leads the
installment and liquidity lending group in the research, markets and rulemaking
division of the bureau.

Hackett was asked about many elements that have been
connected with the CFPB since the agency released its auto finance industry guidance
back in March. Topics ranged from disparate impact to dealer markups to ongoing
investigations that reportedly are underway.

During a nearly hour-long back-and-forth session with Hudson
Cook chairman Tom Hudson, Hackett gave lengthy answers to questions NAF
Association members had. SubPrime Auto Finance News intends to publish more
dialogue from the question-and-answer session in upcoming issues of SubPrime
News Update, but one of the many legal experts in attendance Thursday morning gave
this summation.

"I think Rick is continuing to let everyone know the same
message about a couple of different points," said Mark Edelman with McGlinchey
Stafford, a law firm that services the auto industry with offices in six states.

"The bureau has been pretty transparent in terms of what is
important to them. I think his presentation further continued those same things,"
continued Edelman, who also served on multiple panel sessions during both the
NAF Association's ongoing event and also last month's National Conference
orchestrated by the National Alliance of Buy-Here, Pay-Here Dealers.

Exeter Finance chief executive officer Mark Floyd also
shared his assessment of Thursday's session. Floyd was among many high-ranking
executives filling the Omni Fort Worth Hotel ballroom from companies such as
Capital One Auto Finance, Santander Consumer USA and GM Financial.

"The CFPB is here to stay. That's something every lender has
to come to terms with," said Floyd, who heads up the seven-year-old specialty finance
company that caters predominantly to franchised dealers.

"What everyone is trying to figure out now is what that
means for the industry and for their company specifically," Floyd continued. "Because
of the uncertainty around how the CFPB determines disparate impact — there's been
no clarity around that — there's concern about how they're doing their
analysis with disparate impact. Nobody knows what it's going to be.

"All of the uncertainty creates more uncertainty. The good
news is it hasn't slowed down business," Floyd went on to say.

After Hackett's time at the microphone, the presentation by
Experian Automotive's Melinda Zabritski confirmed Floyd's assessment of the subprime
financing market. Zabritski tailored her presentation to show first-quarter
statistics only for nonprime, subprime and deep subprime borrowers, indicating
how originations are trending higher year-over-year while delinquencies are
remaining near record-low levels.

Thursday's conference slate included more industry analysis
from experts such as Black Book's Ricky Beggs and Manheim's Tom Webb. Several
members of Hudson Cook's stable of attorneys, including Michael Benoit, Jean
Noonan, Patty Covington and Joel Winston, discussed regulatory concerns ranging
from fair-lending policy to what was described as a "culture of compliance."

No matter how much or how little the CFPB divulged at the
NAF Association's event, legal practitioners such Edelman appear to have plenty
of regulatory matters to monitor.

"Our clients expect us to stay on top of where things are
changing," Edelman said, adding that his firm taps a variety of legal resources
to monitor potential developments on both the federal and state levels.

"At the federal level, things happen with great fanfare," he
continued. "There are rules and regulations that are promulgated. There's a
comment period. There's publication in multiple sources about what's going on.

"At the state level, the governor by the sign of a pen could
take a bill that just passed and turn it into a law that's effective that day.
So you really have to stay on top of things," Edelman went on to say.

While much of the conference's Thursday sessions focused on
regulation and compliance, the NAF Association is wrapping up its event today
with a schedule that includes a presentation analyzing the auto ABS market with
Amy Martin, a senior director at Standard & Poor's.


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