For most junior members of our armed forces, financing a car is their largest and most significant financial obligation.
Not only are military personnel given access to many special deals and incentives in appreciation of their service to our nation, they are also, unfortunately, subject to a number of predatory lending practices as well.
The Department of Defense is now endorsing legislation that would create a government agency tasked with protecting military personnel and their families from being preyed upon by predatory car dealers and shady sales tactics. The proposed name is the Consumer Financial Protection Agency, and it would oversee both sales and
car loans for military personnel. As the DOD has stated:
"The Department of Defense fully believes that personal financial readiness of our troops equates to mission readiness."
The reason that the automotive sales industry is being targeted is that car loans are the most significant financial responsibility for most military personnel and their families. Some of the unethical practices specified include loan-padding, falsifying applications, and all forms of bait & switch tactics.
Opposition to the New Agency
The NADA (National Auto Dealers Association), however, is heavily opposed to the new legislation. As their representatives have stated, these unethical and predatory practices are already illegal -- they just need to be better enforced. They're also stating that this legislation would most probably threaten and even eliminate the chances for many military personnel to get approved for financing and auto loans.
Compromises
Members of the Senate are trying to write a revised bill that would make both parties happy. There have been talks about creating an agency within The Treasury Dept with similar responsibilies, as opposed to a wholly separate Consumer Financial Protection Agency.