Updated Colorado data requirements that will require lenders to provide full copies of certain F&I product records when requested went into effect on Feb. 1, 2025. Among other things, the revised recordkeeping rule tightened documentation requirements for GAP waivers and is the latest instance of heightened state-level regulatory oversight on aftermarket products in the auto-finance industry.
Since the effective date, F&I Sentinel’s Concierge Team responded to inquiries from our lender partners on how to adapt processes to meet these new requirements. Lenders that don’t already have document storage and retrieval technology or processes in place will be challenged to stay in compliance with Colorado’s requirements and will most likely incur significant labor hours tracking down the right data thereby increasing financial and reputational risk.
The Colorado Rule and GAP Waivers
The revised rule requires licensed creditors to maintain 23 distinct record categories – ranging from advertising and credit applications to detailed loan-level payment histories – in formats readily accessible to the state’s Administrator.
To meet these requirements, lenders must maintain or make available:
- Copies of GAP waivers funded
- Agreements with GAP waiver administrators
- Records of the purchase price of GAP waivers funded
- Records of refunded provided
- Records of benefits (claims filed) provided and any deductions
While the rule is onerous, lenders leveraging F&I Sentinel’s Managed Originations solution powered by CITADEL already have access to tools that will assist them in satisfying these new requirements. Specifically, F&I Sentinel’s product form repository in CITADEL and the Product Submission Agreement* (PSA) handle the heavy lifting for our lender partners in the following ways.
*PSAs are executed by the F&I product company in favor of lenders that leverage our Managed Originations solution. PSA copies are stored in CITADEL.
Lenders Leveraging F&I Sentinel’s Managed Originations Solution Powered by CITADEL
| Requirement | F&I Sentinel |
|---|---|
| Copies of GAP waivers funded | Lenders have access to full copies of funded GAP waiver forms in the CITADEL repository.For those not found in the repository, F&I Sentinel can obtain the waivers for lenders because the PSA requires product companies to share historically funded forms and promptly respond to F&I Sentinel’s request on behalf of our lenders. |
| Agreements with GAP waiver administrators | Most lenders don’t have agreements with product companies beyond the GAP waiver itself. Regulators appreciate the presence of a PSA, which drives product company behavior and responsiveness.The fully executed PSA is available in CITADEL and our technology team can assist with special projects for bulk requests, as needed. |
| Records of fees received | Most lenders don’t have agreements with product companies beyond the GAP waiver itself. Regulators appreciate the presence of a PSA, which drives product company behavior and responsiveness.The fully executed PSA is available in CITADEL, and our technology team can assist with special projects for bulk requests, as needed. |
| Records of refunds provided | Captured through cancellation notices and our Managed Cancellations solution through refund quotes provided via the GAP waiver administrator or through our FAIRRCalc quote engine. Some of our lender partners that debit the dealer reserve and refund consumers directly are able to provide evidence that the consumer was credited based on the quote. |
| Records of benefits and deductions | This item appears to be in reference to the GAP waiver purchase price, which would be captured on the finance agreement and the loan origination system. |
F&I Sentinel: Your Partner For Reliable Data Retrieval
Ultimately, a lender’s ability to meet this and other stringent requirements that are in effect now is directly related to the tools and controls that are already in place. Lenders that are counting on product company goodwill alone to drive responsiveness ought to consider adding more rigor into their processes.
Do you have questions on how to prepare your organization for increasing demands for F&I product documentation and retrievable data? Please contact us to learn more about how F&I Sentinel’s Managed Originations solution can protect your business and provide the peace of mind you need.
About F&I Sentinel
F&I Sentinel empowers auto-finance companies, auto dealers, and F&I product companies with dynamic, technology-driven compliance solutions that reduce friction, enhance transparency, and streamline aftermarket product management. Over 100 auto-finance companies, including six of the top 10, and over 600 F&I product administrators, count on F&I Sentinel to deliver scalable infrastructure and best-in-class regulatory expertise to efficiently manage the lifecycle of aftermarket products—from funding to cancellation—in a rapidly evolving regulatory landscape. Learn how our repository of more than 190,000 F&I product forms and our Concierge Team can support your F&I product management journey here. Schedule a no-obligation meeting with a member of our Concierge Team today.
The information provided in this post does not, and is not intended to, constitute legal advice; instead, all information, content, and materials referenced are for general informational purposes only. Readers should contact their attorney to obtain advice with respect to any particular legal matter.
