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ConsumerFi Podcast: NAF Virtual Conference Preview with Jack Tracey

November 5, 2020

Episode 3


This week, Joel speaks with Executive Director of the National Auto Finance (NAF) Association, Jack Tracey, about the upcoming virtual Non-Prime Auto Financing Conference, including partnering with Used Car Week, logistics of the virtual format and highlighting some of the speakers and sessions available.


[0 4:29:22 AM] Joel Kennedy: You’re listening to the consumer FY podcast powered by Northbridge loan software that acceleration.

[00:00:13] All right, everybody. Welcome to the podcast. I am really excited today to have with us Jack Tracy. Who’s the executive director of the national automotive finance association, Jack. Welcome to the podcast, right? Thank you,

[00:00:26] Jack Tracey: [00:00:26] Joel. I appreciate you having me on. So like, uh,

[00:00:31] Joel Kennedy: [00:00:31] well obviously I think a lot of folks are, are really interested in how you and the team have been fairing with the whole COVID crisis.

[00:00:39] Jack Tracey: [00:00:39] Well, I guess like the rest of the industry we’ve had to adapt, uh, uh, uh, programs I’ve had in the past have been primarily, uh face-to-face and in person. And we’ve had to change that our conferences, probably the primary thing that we’ve had to change, uh, We’ve had a conference that’s been [00:01:00] running for 24 years and as a very substantial following.

[00:01:04] And, uh, it became apparent several months ago that we couldn’t continue to have a live session. So we decided to go virtual and, uh, uh, doing some discussions with some people in the industry and found that, uh, it would maybe be a good idea if we combined our event with another industry event. And pulled, uh, more people together and provided more content.

[00:01:30] So, uh, we have, uh, decided to marry our conference, at least for this year, with the used car week folks. And, uh, they have a, a week long program on the auto financing industry and, uh, we’re putting ours on top of theirs. So, uh, what’s really is nice is that the, uh, uh, people are registered for our event.

[00:01:55] It’s a two for one they’re getting twice the content that they normally would. [00:02:00] And, uh, uh, I think it’s a good deal.

[00:02:03] Joel Kennedy: [00:02:03] I think it’s fantastic. Given the environment that we have, obviously folks who rely on the conference circuit love, having them back to back, uh, to combine them, I think is, is, is really a smart move.

[00:02:16] And you guys are doing the right thing with sharing that overhead. Obviously I’m partial. I should mention. I’m also the president of the trade group have got a little bit more time on my term here. Um, But anyway, Hey Jack, you know, tell us a little bit about your background with the trade group. I think everybody knows, but I, I I’m really proud of, of what you’ve accomplished and, and I’m always going to give you a chance to kind of tell people about your, your long tenure and how you were there from the beginning.

[00:02:43] Jack Tracey: [00:02:43] Uh, yeah. Uh, 20, 40 years ago, I was, uh, instrumental in helping to create the association with, uh, some attorneys and some people in Nan history who at that time felt that the industry needed a, uh, anew improvement in their profile [00:03:00] and their image in the industry. Uh, and that’s why the association was formed.

[00:03:04] Uh, and, uh, It has grown. And our mission has certainly changed from CRA improving the image, uh, through, uh, you know, uh, economic crisis and, and, uh, cyclical swings in the industry. And now with trying to, uh, To deal with a altered, uh, business environment. Uh, we’ve always focused our attention on, uh, the needs of that sub segment of the auto financing industry, the subprime market.

[00:03:35] A lot of what they do has implications strike the entire auto financing industry, but we really do a zero down to the, uh, To define her points and, uh, when needs to be done when you’re managing a portfolio of higher risk, uh, uh, gods, which is

[00:03:52] Joel Kennedy: [00:03:52] a perfect lead into. Um, to some of the topics, I think we wanted to give an overview of the content that we’re going to be [00:04:00] presenting.

[00:04:00] So to start off the dates for the conference are November 16th to November 20th, it’s all virtual. We have some, uh, some live sessions as well as some library recorded sessions. So there’ll be plenty of material there. And then it also is going to bleed into a repo con on December 2nd through the fourth.

[00:04:20] That is that. Extra linkage. You get extra value by participating in our conference, by being able to also participate in

[00:04:27] Jack Tracey: [00:04:27] that. Now let me expand on that a little bit. Uh, I, when I talk with the used car week folks, uh, they’ve done a couple of, uh, conferences now virtually, so they bring some experience. And I tried to build on that experience that they had and what their attendees would like to, uh, to have in a virtual environment, uh, and that like a, a live environment where you come for a couple of days and it’s pretty intense one session after another that, uh, people would attend a virtual event.

[00:05:00] [00:05:00] I really still at their desk at the office and, uh, uh, they’ll devote part of their day to, but not all of their day. So we’ve taken our normal two and a half day conference, uh, and spread it out over, uh, over five days. And, uh, and the way we’ve done it is on the Monday, Wednesday and Friday of our week.

[00:05:23] We’re just going to have two or three sessions. Uh, starting at noon Eastern time until about two 30 with some breaks in between and, uh, their wives sessions where the actual, uh, presenter will be in a zoom format, uh, speaking to all of the attendees and we’ll have some ability to question the presenters after they’ve spoken, um, On the Tuesday and Thursday of the week, we’re having a series of what we’re referring to as library sessions.

[00:05:55] These will be prerecorded sessions that our panels [00:06:00] have, uh, panels or individual speakers have put together and we’ve recorded them. Uh, uh, Those, there are a number of those sessions, the prerecorded sessions. So attendees can determine by the subject matter if they’re interested in or not, and they can view them at their leisure and all of the live sessions after they’re given become part of the, uh, of the library.

[00:06:25] And the library remains open, not just for the week of the conference, uh, but through the end of the, uh, Through the end of the year. So, um, uh, conference attendees just can, uh, look at these sessions whenever they can fit them into their schedule. And, uh, we feel that at the price point, we, we built this, uh, uh, it’s probably, uh, an attractive, uh, offering, uh, to the marketplace.

[00:06:49] Uh, normally a conference like this, you know, runs then in our, uh, you know, previous conferences, uh, anywhere from about 600 to a thousand dollars, [00:07:00] we’re making the virtual conference, uh, $200. And as I said before, you get the content of our event, plus a used car week’s event. Uh, we have less overhead with, uh, doing this virtually.

[00:07:12] So we’ve reflected that in our, in our pricing. So I think we’re giving good value. And as to what you just said a few minutes ago, rebroke con, which is part of the used car week, second week of their, uh, event. Uh, we’re going to have access for our registered students to be able to view the content. There there’ll be some live sessions and some prerecorded sessions in that week, too.

[00:07:37] Joel Kennedy: [00:07:37] That’s great. Yeah. And the repo con is something that obviously we’re, we’re interested in Jack, we’ve been partnered up with the ARA to try to address issues of standardization in the industry, which leads us into our keynote speaker. We have Jennifer LaTourette, who is a, uh, a regulatory affairs specialist with, um, Vanscoy associates.

[00:07:57] There are longstanding lobbyists out of, [00:08:00] out of DC. Uh, she’s going to be our keynote speaker. Is that right? Jack?

[00:08:04] Jack Tracey: [00:08:04] Yes, she is. And hopefully this will be after the election. She can bring some perspectives on, on the election and the complexion of the, uh, of the Congress going forth and the implications it may have on our industry.

[00:08:20] She has a good background in our industry also. And, uh, I think the combination of our background and, uh, her ability to, uh, Uh, set a stage from a political standpoint. Uh, it’s a good way to open the conference.

[00:08:35] Joel Kennedy: [00:08:35] Yeah, I’ve spoken with her, uh, myself. She is, uh, the representative of the repo Alliance, which was a pack that was formed just prior to COVID, uh, to represent the interests of, uh, the recovery professionals and, um, What strikes me about her.

[00:08:52] That’s really awesome is we have a lot of obviously political polarization. Um, she’s somebody who’s worked on [00:09:00] both sides of the aisle and it’s, it’s my expectation that that’s going to inform, uh, her presentation. So we’re, we’re definitely excited to have her. Um, so there’s two main tracks, right? You have the industry.

[00:09:14] And business track and then the compliance track. So we’ll, we’ll keep going down the business track. Um, you have some really cool people for industry insights. You know, the first one, uh, that I’ll mention is Joe Cioffi, uh, who has a product called credit chronometer um, When did we, when did we, uh, I met Joe last year.

[00:09:37] I think that was probably about the same for you, right? We are. Yeah,

[00:09:41] Jack Tracey: [00:09:41] no, I became aware of Joe and what he does, he does, uh, I survey of the abs market and the study of it. So he makes some very insightful. Observations on what’s happening with portfolios that have been securitized and a lot of our industry, uh, they get [00:10:00] their funding through securitization.

[00:10:02] And so it’s insightful. Uh, his study, uh, sort of, uh, um, uh, paired alongside of our NAF association study provides us. Two different perspectives on the industry. So, uh, attendees at the conference are going to get a lot of, uh, metrics and whatnot, uh, benchmarking data on, on, on the industry and they can use it, uh, for a comparison to what they’re doing back at their

[00:10:30] Joel Kennedy: [00:10:30] shops.

[00:10:31] Yeah. And the thing that I love about Joe’s survey is as we do our NAF survey annually, we are getting the voice of the lenders where he’s getting the voice of all the other constituents that have a stake within the securitizations. So he’s talking to the originators, the servicers, and he has another group that he kind of falls into.

[00:10:50] So we’re excited to have that. We’ve got Jonathan smoke as well. Um, and Jonathan, somebody who we’ve had on before, right.

[00:10:58] Jack Tracey: [00:10:58] Oh, yes. For the last several [00:11:00] years, he provides a very, uh, comprehensive and, uh, and well-regarded outlook on the, uh, uh, the auto financing, uh, on the auto financing industry. Uh, we bring him back each year just because he’s so popular.

[00:11:14] And, uh, he was usually one of the best attended sessions of our conference. So I expect here in our lives, uh, virtual sessions, he’s going to be a heavily viewed. Uh, well, at the time that people had, uh, you had a registrant’s, uh, tune in to what he

[00:11:31] Joel Kennedy: [00:11:31] has to say. Yeah. Yeah. Um, th these are, these are the sessions that I’ve, I feel are just not to be missed.

[00:11:37] Um, we have a look at the abs markets with, with Amy Martin as well.

[00:11:43] Jack Tracey: [00:11:43] Amy has been with us maybe 20, 22 years, almost from the beginning. Uh, and she’s probably the most popular speaker we have. She brings, uh, uh, uh, standard and Poor’s, uh, views of the, uh, the, [00:12:00] uh, abs performance what’s happening. And, uh, she talks a lot about risk and that’s certainly a, um, a big aspect of what the people, uh, uh, who, who are in attendance at the conference or focused on.

[00:12:14] So, uh, they’re very popular

[00:12:16] Joel Kennedy: [00:12:16] session. Yeah, everybody’s kind of, I think everybody’s keeping a close eye, Jack, wouldn’t you say on the lending side to what the fourth quarter is going to look like once we lose. Some of the support and the stimulus looking at delinquencies. Um, I, I think this is just a really relevant topic right now,

[00:12:35] Jack Tracey: [00:12:35] relevant topic at a relevant time.

[00:12:37] Uh, the timing of this, uh, conference, uh, is, uh, is very important. We’re ending the year, the stimulus. Packages, uh, the effects of them and supporting, uh, the economy or are diminishing and the real effects of, uh, the layoffs and whatnot are really going to be felt, uh, that coupled with the election. Uh, [00:13:00] there’s just an awful lot to talk about at the end.

[00:13:04] Yeah. Uh, 2020, uh, more so than in most other a year ending events. I think our event, uh, is the last audit financing conference of the year. So we’ll probably be able to give, uh, uh, as complete a summary of what’s happened in the year as is anyone can be just because of the timing of the event.

[00:13:23] Joel Kennedy: [00:13:23] Yeah. And we’ve had unprecedented activity on the regulatory side and we’ll, we’ll touch on that in a minute, but so we’ve gotten through kind of the industry insights portion.

[00:13:32] We have a session on used car vehicle values as well, which I think is obviously going to be important as we move into the next cycle where we may be. Actually recovery, more collateral where the delinquencies really kind of come to bear and the defaults start hitting.

[00:13:48] Jack Tracey: [00:13:48] Yeah. And he’s card values, fluctuate, and the fluctuations can either have benefit or a drag on what our portfolios do.

[00:13:58] So we always try to, [00:14:00] uh, to where no matter where we are in an economic cycle or what’s, whatever’s going on, we’ve always tried to focus on, you know, what are the values today and whether they’re projected to be going forward because, um, finance companies will adjust their underwriting and their portfolio grows sizes, uh, depending on.

[00:14:20] Uh, that is part of the equation they use. We tried to provide, uh, the auto finance executive with this complete an overview of what’s going on in the industry, uh, so that, uh, they can, uh, you know, set objectives and goals for the, uh, for the upcoming year. Which

[00:14:39] Joel Kennedy: [00:14:39] which, which, which perfectly moves us into something that I’m excited about, which is a best practices round table, Jack, you and I have heard loud and clear that, that the executives and the decision makers and the doers really care about what their, what their peers are doing.

[00:14:56] And in so far as, you know, we can share things that are. You know, fraud [00:15:00] based, you know, not a strategic, uh, competitive type deal. Um, we want to create that forum for people to be able to talk. So we’ve got some best practices, round tables.

[00:15:10] Jack Tracey: [00:15:10] Yeah, and we have, uh, we have two of those, uh, there’ll be on Tuesdays and Thursdays.

[00:15:15] So we’ll be viewing the live sessions we have on those days, we will invite some of the attendees that we’re having a finance company, people into the session and, uh, hopefully, uh, get them to open up about what they’re doing and various, uh, aspects of their business. And, uh, hopefully the, uh, Uh, the fact that we only have finance company executives, there will allow them to be more free and open as to, uh, discussing, uh, you know, solutions they have or concerns they have.

[00:15:49] Uh, we’re hoping that if these, uh, sort of round table discussions, uh, merit, then your association will pick them up and have them up. [00:16:00] Probably virtually going ahead, uh, similar to the round tables we have for our compliance folks, which are very, very popular. And we’ve done those for a couple of years

[00:16:11] Joel Kennedy: [00:16:11] now.

[00:16:11] Yeah, everybody always has questions and they always want to kind of compare where they stand. So I think it’s kind of a natural progression. So, um, let’s talk a little bit about the legal regulatory there. There’s there’s obviously been a lot of things we’ve had. Uh, governors putting out edicts, uh, like we had no annoy with, with, with, with repossessions being on hold.

[00:16:33] So we’ve got all kinds of legislation going on in California. The regulatory spaces is really kinda moving and obviously with an election year and, and new stuff with the CFPB, what are some of the highlights that you’d like to call out on the regulatory track? Jack? Well,

[00:16:49] Jack Tracey: [00:16:49] uh, first, let me explain why we set up a regulatory track.

[00:16:53] Uh, the association through its education program is a certification program. We have four [00:17:00] compliance people. We’ve got over 600 people that have graduated from that. So we have an awful lot of our membership. Uh, that are focused on and concerned about the, um, the compliance aspects of our industry. So, uh, uh, we put a separate track on our conference for people, uh, and realizing that not everybody yet tens of conferences going to be interested in all the topics that are here.

[00:17:25] Uh, but the complaints from, uh, that, uh, that have gone through the program certainly are. And, uh, we’ve got, uh, Uh, w what I, what I would think of as sort of detailed looks at the parts of the regulatory thing, titling and privacy and whatnot, and, uh, uh, I encourage people that attend the conference that may be more oriented to the industry, a track to come over and, and look at what we’ve got here in the content, on the, on the, uh, Uh, on the compliance track because, [00:18:00] uh, there’s some insightful things that, uh, that will be discussed.

[00:18:04] And, uh, and, um, you can probably leave with some, uh, some, uh, information that you wouldn’t otherwise have. Uh, one track that we’ve kept on that compliance. Attract, uh, for a number of years now is our legal panel. When they go into a what’s happening in federal legislation and regulation, and also in selective States that panel, uh, we’ve divided it into two.

[00:18:33] To a library sessions. So, uh, they’ll do a fairly extensive coverage of, uh, of those topics. Um, it’s an alternative to what you’d normally get at a autofinance, uh, conference because they’re a specific detailed, uh, Uh, sessions here that are, uh, they’re very helpful.

[00:18:54] Joel Kennedy: [00:18:54] Yeah. And I love the voices that we have.

[00:18:56] Obviously, Eric Johnson is, is known to everybody. We’ve got [00:19:00] Sean Peterson who’s with, uh, is he NADH Jack. Uh, uh, uh, NIH, sorry. Uh, we got Sean Peterson with NIH and then Steve Levine, uh, with ignite and then Mark Edelman, who is with, uh, one of these other law. There you go. Everybody, everybody knows Mark as well.

[00:19:20] Um, but these are, these are great voices. These are people with consistency with, uh, A lot of exposure in the market. Obviously Steve has a lot of exposure with the dealership space. So, you know, when, when we look at that, um, who’s going to bring in that great perspective. Uh, okay. So fraud fraud, something that, uh, I got to pick on Jack for having a crystal ball and really having great foresight.

[00:19:45] We created fraud Friday, shoot three, four years ago. I want to say. Yeah. And it’s

[00:19:51] Jack Tracey: [00:19:51] been, yeah. And it continues to be a problem. Yeah. And, uh, uh, and maybe even more so today in an [00:20:00] environment where many people are working remotely. And so, uh, we’ve had such a positive response to, uh, our fraud coverage that we’re going to pick that up with several a while, a couple of sessions here on our agenda this year.

[00:20:14] Uh, Joel, you’ll be a sort of. Leading the way on that, because you’ve taken that on as sort of a, one of your responsibilities as president of the association. So maybe use your thoughts a little bit about the fraud

[00:20:27] Joel Kennedy: [00:20:27] sessions. Yeah. And it’s, I’m really excited. Uh, two great fraud sessions. One’s going to be.

[00:20:32] Uh, kind of a fraud trends discussion that Frank McKenna of point predictive is heading up. He’s pulling in some other, uh, experienced, uh, individuals potentially from former law enforcement that, uh, uh, I’m going to hold out and, and excite people with later. Uh, the other session is kind of a combination of, of doing the best practice session with, um, with, with actual information.

[00:20:59] So we’re [00:21:00] looking at. We brought in three fantastic practitioners within lending businesses that they they’re, they live and breathe fraud. And they’re going to talk with us. And again, it’s a peer sharing opportunity. Um, For us to kind of listen to what the other folks are doing. So, um, and that’s something that we, we, we have tended to really look for within fraud is to get people to share information, um, where they’re getting taken down through criminal activity or what have you, that’s not a way to compete, right?

[00:21:32] So we want to make sure everybody has the right adequate defenses up. And then us as a trade group, obviously, Jack, we want to make sure that we’re doing our part in spreading that knowledge around isn’t that right?

[00:21:44] Jack Tracey: [00:21:44] Yeah, uh, we’re serving industry and we address fraud issues because everybody gets burned by it.

[00:21:51] And, uh, to the extent that we can educate our members on it, uh, the industry will benefit from it. Uh, [00:22:00] uh, Joel, let’s talk a little bit about, uh, the, the extra benefit, uh, that we’re able to offer our agendas this year. And that’s. And the, uh, second week of used car week, they devote 3 million share of that conference, uh, to, uh, to the repossession possession industry.

[00:22:19] And, um, Uh, we’re going to be able to, uh, uh, share those, uh, sessions with the people that registered for our event. And the repossession industry is really been impacted, uh, this year because of COVID because they, uh, In many States were considered non-essential businesses. So while finance companies could continue, uh, to operate, uh, they didn’t have the ability to reclaim collateral and they needed to, and, uh, while it’s not necessarily, um, uh, necessary in every, uh, transaction, that one [00:23:00] engages when a high, uh, Uh, credit risk portfolio.

[00:23:04] There are certainly occasions, uh, more than an a prime portfolios, certainly whether their collateral has to be reclaimed. So, uh, The, uh, the pandemic has really impacted the ability of those folks to work and for our finance companies to reclaim their collateral. So, uh, uh, it’s an important, uh, aspect and we’re going to have a couple of days and topics covering Matt.

[00:23:31] So, um, Uh, and they’re being developed at this point, can’t necessarily speak to what they are, but over the next couple of weeks, so sessions would put together and coach people to look on, uh, on the NAF website at the agenda. And, uh, you’ll see the, uh, the repo, uh, sessions, um, uh, come together here and will be posted on the

[00:23:53] Joel Kennedy: [00:23:53] website.

[00:23:54] Yeah. And the recovery space is Jack. I’ve never seen an industry go through so much [00:24:00] change in such a short amount of time. The change in technology, um, the rise of the forwarder. You’ve got obviously a lot of compliance and regulatory issues that have taken a bit of a turn since COVID. And just in terms of understanding our counterparty there, or our partner there, uh, what, what is the pain that they’re feeling?

[00:24:23] What is going well? Uh, you know, we have to be informed as to what’s going on within that market and Jack you and I continue to stay engaged with the ARA from on all those fronts and even, even inactive lobbying that we’ve done this year, uh, to, to help in, in the state of California, which we’re, we’re continuing to do.

[00:24:42] Uh, in concert

[00:24:43] Jack Tracey: [00:24:43] with it’s again, a, an aspect of the business that’s, uh, unique to the non-prime, uh, sector, uh, prime, uh, auto financing, uh, is only tangentially interested in the repo market. Right. The way we look at it, [00:25:00] the, uh, recovery market, uh, for a non-prime portfolio is an integral art and needs to be able to be addressed as, uh, as appropriately and as quickly as it can be.

[00:25:12] And when that gets slowed down or limited in any way, uh, it affects the, uh, the ultimate profitability of a, uh, of a higher risk

[00:25:21] Joel Kennedy: [00:25:21] portfolio. Yeah. Yeah. So we’re, uh, I’m excited about all these things. Well, Jack, um, you know, I’m excited, you’re excited about the conference. Uh, looking forward to it, November 16th is going to be here before we know it.

[00:25:38] Jack Tracey: [00:25:38] Yeah. Yeah. Uh, we are going to be posting the, uh, conference and, uh, announcing everything here today. And, uh, I encourage everyone. That’s listening to the podcast to go to the NTF association, uh, webpage, uh, NAF and, uh, see the event. Uh, as I said earlier, it’s priced very [00:26:00] competitively.

[00:26:00] You’re going to get a lot for your money and I encourage people to, um, To sign up

[00:26:06] Joel Kennedy: [00:26:06] and attend outstanding. Well, Jack, thank you so much for taking the time today to get on the podcast and give everybody the lead in for, for what I’m sure is going to be a fantastic conference. Yeah.

[00:26:19] Jack Tracey: [00:26:19] Thank you, Joel. Thanks for your work as president of the association.

[00:26:24] Joel Kennedy: [00:26:24] Thanks Jack. The consumer five podcast has been brought to you by Northbridge loan software. That accelerates change. We’d also like to thank the national automotive finance association, the only trade association, exclusively serving the non-prime auto financing industry.

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