Operating in the dynamic automotive finance sector requires deep knowledge of commercial, consumer, and ancillary products. Hinshaw can help. 

We provide state-of-the-art representation to automotive finance clients nationwide. With a deep understanding of the distinct issues facing stakeholders in this sector, we help clients manage risk and navigate the increasingly complex regulatory landscape in which they operate. 

Our team has decades of firsthand experience advising industry-leading businesses on the full range of transactional, regulatory, compliance, and litigation matters impacting the automotive finance industry. We work with: 

• Captive automotive finance companies
• Independent automotive finance companies
• Banks and credit unions
• Online and retail vehicle marketplaces
• Automotive FinTech companies
• Ancillary product providers
• Private equity investors 

We advise clients at every step, including licensing, advertising, lending operations, product design, loan structure and documentation, collections, bankruptcies and workouts, loan-level litigation, compliance management systems, and third-party relationship management.

 Areas of Focus Include:

Automotive Floorplan Lending

We regularly guide financial institutions and lenders in high-volume, asset-based, or floorplan commercial loan transactions regarding structures, documentation, negotiations, closings, and best practices. Our cross-disciplinary team also provides proactive — and often preemptive — counsel regarding loan-level litigation, workouts, out of court loan restructuring, and other atypical resolutions involving troubled dealers and assets. 

We also regularly advise floor plan lenders on: 

• Due diligence and risk analysis
• Reviews of document suites
• Subordination and intercreditor agreements
• Real estate loans in the context of floor plan lending
• Negotiation and closing of new floorplan loans and affiliated loan packages
• Structured termination of floor plan relationships with dealers

Consumer Retail Installment Sales Contracts, Leases & Loans

Our experienced team routinely advises clients on each aspect of the automotive financing process, from licensing to the initial credit application to retail installment sales contract, loan and lease agreement documentation, through servicing, collections and repossession. We develop policies and procedures, compliance management systems, consumer correspondence, and quality assurance and quality control programs. We have significant experience representing clients in state, CFPB and OCC supervision matters and defending enforcement actions brought by the FTC, CFPB, OCC, Department of Justice and multiple state regulators and Attorneys General.

Examples of our recent experience include:

• Advising automotive finance companies on developing fair lending disparate impact self-assessments and related policies and procedures
• Advising automotive finance companies serving limited English proficiency (LEP) borrowers, including providing Spanish translations of websites and other servicing correspondence
• Advising automotive finance companies in connection with state and CFPB supervisory examinations, including COVID-prioritized assessments
• Representing automotive finance companies in connection with civil investigative demands by state Attorneys General
• Creating and updating the full suite of nationwide repossession notices and accompanying policies and procedures, including specific notices for use when the borrower is protected by a bankruptcy proceeding
• Licensing a leading global investment business in its purchase of portfolios of consumer motor vehicle secured retail installment contracts
• Conducting due diligence on numerous samples of consumer motor vehicle secured retail installment contracts for bulk portfolio acquisitions and commercial credit extensions
• Developing and updating surveys of state laws extending benefits and protections to servicemembers beyond the Servicemembers Civil Relief Act (SCRA) for automotive finance companies
• Advising a leading e-commerce platform for automobile dealers on federal and state law compliance
• Representing automobile dealers on state licensing and structural issues related to e-commerce platforms and the development of sales and financing documentation

Financial Services Litigation

Almost every business wants to avoid litigation. When disputes cannot be resolved through negotiation, companies need strong, effective, experienced counsel. We have successfully defended clients against individual and consumer class actions, arbitrations, and in multidistrict litigation, often serving as national coordinating counsel. In addition to loan litigation, contentious troubled-dealer matters, bankruptcies, foreclosures, and complicated workouts, we have extensive experience in lien priority, repossession, title, consumer protection, and other disputes. In fact, we have been recognized by Lex Machina as one of the top five firms nationwide in defending FDCPA, FCRA and TCPA and other consumer protection claims.

Ancillary Products

Understanding the complexities of ancillary products is key to every automotive finance client. The combination of our insurance and consumer financial services regulatory and compliance teams provides deep experience on federal and state law issues impacting the structure, documentation, licensing, sale, and financing of ancillary products, including credit insurance products, debt cancellation agreements (GAP insurance and waivers), service contracts, and warranties. We frequently advise clients throughout the industry on these issues.

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