Consumer Credit Regulation: 11.4.2.1 General
For a consumer with a particular credit risk and type of automobile purchase, automobile finance companies establish a “buy rate,” which is the minimum interest rate that the assignee finance company will accept to purchase that RISC from the dealer. The dealer is allowed to increase the financing rate beyond the buy rate, up to a maximum amount. The dealer and finance company split the difference, often with the lion’s share going to the dealer.