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Consumer Groups and Bailment Fees

If you have read any updates from the NADA Legal/Regulatory team, you've certainly heard about national consumer groups launching attacks against the sale of Voluntary Protection Products. But, far from thinking this is solely a federal issue, Colorado affiliates have been making appearances at regulatory meetings in 2019.


During spring-time meetings of the Motor Vehicle Dealer Board, local representatives petitioned the Board to modify the way in which dealers are permitted to charge bailment fees on failed spot deliveries. In the position of the groups, a daily or mileage-based usage fee should not be charged to a consumer until notification of failed financing is provided - as opposed to today's method of charging from the date of contracting.


Of course, many dealers voluntarily forgo the collection of bailment fees in all instances, save those where there is bad behavior on behalf of the consumer. Perhaps, the organizations were unaware of this. Data they used to support their claim emanated from the pre-2008 era.


But, there mere presence suggests that this issue may have been a test run for local fronts on a national battle. This would place scrutiny on such consumer friendly items as GAP, which is already capped by regulation in Colorado. We are anticipating meeting them again, either in the regulatory agencies or the legislature. Stay tuned for updates.

In the meantime, if you have any questions about bailment fees or voluntary protection products, please feel free to comment to this post, or respond by e-mail at matthew.groves@colorado.auto

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