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Separating Fact From Fiction

The menu is without a doubt the best tool you have in your toolbox. Nothing else compares to the effectiveness of this tried-and-true method of introducing repayment options to a customer — not an evidence manual, broken ECM module, nor any other commonly used prop. And whether you subscribe to the multi-column, single-column, paper or electronic version, the menu has been a game changer since it was first introduced to the F&I office.

But the menu’s impact isn’t just reserved for us F&I pros operating in the U.S. market. F&I offices around the world, including Canada, South Africa and Australia, have realized the benefits of this presentation tool. I’ve even observed a version of the menu being used in Brazil and other South American countries.

So while I don’t think anyone will disagree that the menu represents an effective way to present payments and products to customers, just about everyone has a thought on the ideal format and usage of this key F&I tool. Problem is, some of these opinions are blurring the lines between fact and fiction.

For instance, have you ever heard someone describe the menu as a compliance tool? See, there are some individuals in our industry who cite mythical regulations that supposedly govern how a menu should be used. For example, have you ever heard people say the base payment must appear on the menu and be disclosed by the F&I practitioner? One could argue that sales is responsible for making that disclosure since the desk usually sets the initial terms, including rate and payment. So who’s right?

The magazine even had legal wiz Tom Hudson weigh in on this question in the November 2012 issue. He made it clear that not disclosing the base payment on the menu doesn’t violate any known federal statute. However, he wrote that doing so would represent a best practice for avoiding accusations of payment packing.

“Disclosing the base payment as part of the menu presentation eliminates the possibility that a plaintiff’s lawyer or state attorney general could argue that the customer was misled into thinking that the Tinfoil Package was the lowest cost option available,” Hudson wrote. “There might be ways to prove that outside the menu presentation, but including the base payment disclosure in the menu presentation makes sense as a best practice.”

Hudson also noted that in California, the Automobile Sales Finance Act requires a separate written disclosure be given to the buyer prior to the execution of a motor vehicle retail installment sale contract. It must disclose the monthly installment payment with and without the optional products or services.

There also seems to be a divide over whether the menu should list product pricing. See, some individuals believe that the F&I office should be as transparent as glass and list the exact price on the menu, while others argue that customers are really only interested in how the products impact their monthly payment.

So who’s right? Again, since there is no rule that spells out what needs to be on the menu, it really comes down to how the dealer wants his F&I office to operate. The same goes for caps on product pricing.

I’ve also heard stories from my fellow F&I pros of menu vendors claiming that dealers are putting their stores at risk if they’re using noncompliant menus, ones that have been legally vetted.  

So who’s right and who’s wrong? Well, I’m hoping to get some answers from some of our industry’s top legal minds and menu developers at this year’s Industry Summit, which is scheduled for Sept. 8-10 at the Paris Las Vegas.

See, I’ll be moderating “Compliance: Separating Fact from Myth” on Wednesday, Sept. 10, at 10:05 a.m. Panelists will include David Robertson, executive director of the Association of Finance and Insurance Professionals; James Ganther, president of Mosaic Compliance Services; Matt Nowicki, vice president of retail software for IAS; and Mr. CARLAW himself, Tom Hudson.

I’m really excited about this year’s event. From what I’ve seen, it promises to be the most informative yet. Heck, listening to Rick Hackett talk about his time as the Consumer Financial Protection Bureau’s point man to the auto finance industry is worth the plane ticket alone. And let’s not forget all the great trainers who will be leading this year’s workshops. So make your plans today. I promise you won’t be disappointed.

Marv Eleazer is the F&I director at Langdale Ford in Valdosta, Ga. Email him at 


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