The CFPB is likely to throw its weight around just as much this year as it did last year, only its focus and intensity will be more diverse in terms of the industries that will be affected. Back in 2014, much of the regulatory concern among lenders had to do with the bureau’s ability-to-repay rule with its qualified mortgage standard, and to lesser extents its rules on mortgage servicing and loan originator compensation. Make no mistake. The mortgage industry is still in the CFPB’s crosshairs. The biggest payload to be delivered in this regard in 2015 is the long-awaited and much discussed integrated disclosure rule under the Truth in Lending Act and the Real Estate Settlement Procedures Act. That rule ...
The CFPB has reached out to sympathetic constituencies in search of more legal cases in which it can submit amicus, or “friend of the court,” briefs, a letter from the bureau suggests. The text of the letter was reproduced on a legal blog hosted by the consumer advocacy group, Public Citizen. “The bureau welcomes and encourages suggestions of cases as candidates for amicus curiae participation,” said the Dec. 17, 2014, letter, signed by Meredith Fuchs, general counsel, and Nandan Joshi, director of the amicus program. “We seek your recommendations as important stakeholders in the area of consumer finance.” The occasion precipitating the letter apparently was the three-year anniversary of the program. “Through the amicus program, the bureau has sought to ...
The Community Home Lenders Association, a national trade group representing small and mid-sized community-based nonbank mortgage lenders, is calling on the CFPB to set high uniform standards for all mortgage originators, such as testing, background checks, continuing education and licensing. “These basic requirements ... apply to virtually all professionals involved in real estate transactions and mortgages, as well as to all individuals at banks that sell securities or insurance,” the CHLA said in a recent letter…
The CFPB’s proposal to reduce regulatory uncertainty for financial innovation through the selective use of “no-action” letters is based on a good idea but is likely to fail to meet its objective unless important changes are made, according to three industry trade groups. For instance, when it comes to submitting requests for a “no-action” letter, the set of products and services to which the bureau’s proposal may apply is difficult to identify, the American Bankers Association, the American Bankers Insurance Association and the Consumer Bankers Association said in a joint comment letter to the regulator. “On the one hand, the proposal requires that the product must not be well established; on the other, it may not cover ‘hypothetical products that ...
The residential mortgage space was the only sector in the large financial services universe to see a year-over-year decline in consumer complaints filed with the CFPB, according to a new analysis by Inside the CFPB. The positive performance, a drop of 14.5 percent, is most likely due to the continued recovery in the overall economy as well as the housing market, which is reducing the stresses that produce delinquencies, defaults and foreclosures, which are associated with high levels of borrower gripes.A lesser contributing factor to consumer criticisms in the “resi” space could be the steep drop-off in mortgage originations over the last year, which could be reducing the overall pool from which origination-related belly-aching originates. [With two exclusive charts] ...
Loopholes in the current Military Lending Act rules are allowing lenders to offer high-cost consumer loans to military families by skirting the 36 percent rate cap – in some cases, charging more than 300 percent – as well as sticking them with excessive fees for the products they use, according to recent comments and a report by the CFPB. The MLA is implemented by the Department of Defense, and is enforced by the bureau and other federal regulators. The CFPB filed a comment letter in support of the DOD’s recent proposal to broaden the scope of the MLA rules to cover deposit advance products, and more types of payday, auto title and installment loans. Currently, the MLA rules provide service members and ...
The CFPB’s second report to the appropriations committees of both the U.S. Senate and the House of Representatives suggests the bureau has a full plate when it comes to enforcement-related probes of financial services providers. For instance, “Investigations currently underway span the full breadth of the bureau’s enforcement jurisdiction,” the report stated. “Further detail about ongoing investigations will not generally be made public by the bureau until a public enforcement action is filed.” Elsewhere, the report reminded lawmakers that the bureau was a party in 41 public enforcement actions from Oct. 1, 2013, through Sept. 30, 2014, the period covered by the report, and it proceeded to highlight all of them.However, not all of them have been settled, such ...
The CFPB’s fourth annual human capital report touted the progress the bureau has made in bolstering its human resources capabilities. But it had nothing to say about the controversy over allegations of discrimination and retaliation towards some of its own staff that emerged last year and lead to congressional hearings and a last-minute scramble to adjust the paychecks of select personnel. The closest the bureau got to that issue was a brief mention of requiring a two-day employment civil rights training session for all managers and supervisors, as part of broader effort at leadership development and succession planning. The CFPB also briefly discussed the efforts it is making to attract and retain a diverse workforce. The bureau’s report indicated that ...
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