Many Auto Dealers in Texas Refusing to Accept Outside Financing

By Suzanne Yashewski, Regulatory and Compliance Counsel, Cornerstone League

Car loans are one of the primary business lines for credit unions in Texas. Unfortunately, over the past year an increasing number of auto dealers throughout the state have been telling customers that they refuse to accept outside financing from a credit union or bank. 

When Cornerstone League contacted the Office of Consumer Credit Commissioner (OCCC)—the Texas regulator over auto dealers’ motor vehicle sales financing—to discuss the issue we were told that the buyer should have the option to bring in their own financing, pay cash, or finance through the seller.

Additionally, the OCCC is quoted in a recent article on a Dallas area news website: “The Texas Finance Code does not directly address this issue. However, we are concerned about the practice you described.”

The OCCC has encouraged persons who are experiencing denials for outside financing to contact the OCCC’s Consumer Assistance staff at (800) 538-1579, by sending an email to consumer.complaints@occc.texas.gov, or through the OCCC website at https://occc.texas.gov/consumers/file-a-complaint.

Cornerstone encourages credit unions experiencing this problem to file a complaint with the OCCC and to share information with their membership to do so as well.  If for some reason—such as indirect lending relationships—you are uncomfortable filing a complaint directly, please contact Suzanne Yashewski at syashewski@cornerstoneleague.coop with specifics regarding the particular dealership, what happened, and we will assist in filing the complaint.

For all other questions, please email Suzanne Yashewski at the address above or call her at (512) 853-8516.