AllRegs History of CFPB and the Mortgage Industry
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The document outlines the establishment and impact of the Consumer Financial Protection Bureau (CFPB), created under the Dodd-Frank Act of 2010 to regulate the financial industry and oversee consumer protection in areas such as mortgages and credit. It highlights major milestones, including the development of key regulations like the ability-to-repay rule and the expansion of consumer complaint data. The CFPB's authority and actions aim to protect consumers from unfair practices and ensure transparency in financial transactions.
AllRegs History of CFPB and the Mortgage Industry
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Regulate the 鍖nancial industry Has authority over 19 regulations governing consumer 鍖nance, including broad enforcement Analyze and study the 鍖nancial landscape to make informed improvements Manage complaints about 鍖nancial institutions Restrict unfair, deceptive and abuse acts or practices Nondepository Covered Persons any covered person providing origination, brokerage or servicing of consumer real estate loans Depository Institutions and Credit Union Covered Persons greater than $10 Billion in assets Service Providers any person that provides a material service to a covered person in connection with the offering or provision by such covered person of a consumer 鍖nancial product or service Elizabeth Warren, a Harvard law professor, presents the idea for a consumer protection agency 2007 Financial Collapse 2009 CFPB 鍖rst proposed to congress The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act) established the CFPB with Title X Priorities include watching over: Mortgages Credit Cards Service MembersStudent Loans 2011 President Obama nominates Richard Cordray, the former attorney general of Ohio, head of CFPB Until the appointment of Cordray, the CFPB has limited authority Changes to impact servicing standards, including: Final Rules to RESPA and TILA Early notice of delinquency Requirements for direct and ongoing access to servicer personnel Stricter foreclosure process, especially when conducting a foreclosure sale Legal obligations for bank and nonbank servicers to protect the consumer while transferring loans CFPB turns its focus to compliance in the mortgage industry, by issuing 鍖nal rules The 鍖nal version of the Ability-To-Repay Rule including: Modi鍖cations to the Good Faith Determination of Borrowers Ability to Repay Revisions to Points and Fees under High Cost Mortgages, Open and Closed End Transactions impacting the Home Ownership and Equity Protection Act (HOEPA) and de鍖ning the Quali鍖ed Mortgage (QM)/Ability-to-Repay (ATR) Rule The QM/ATR Rule is signi鍖cant because: This rule will determine the loan products available to consumers for the inde鍖nite future Intended to protect consumers from mortgages that are too high for them to repay Also intended to protect borrowers from loans that have lower introductory rates Requires lenders to obtain and verify information and removes the ability for loans without documentation Higher-Priced Mortgage Loans (HPML) Expanded escrow account requirements Additional appraisal requirements Revised thresholds for determination High-Cost Mortgages Modi鍖ed Counseling requirements Revised thresholds for determination Revised points and fees calculations YOUR BILL TOTAL: $ CFPB Releases Consumer Complaint Data The launch expanded the CFPBs Consumer Complaint Database signi鍖cantly from about 19,000 credit card complaints to more than 90,000 complaints on mortgages, student loans, bank accounts and services, other consumer loans, and credit cards 2013 Some Milestones from this Year... So Far Sources: The CFPB Website http://www.consumer鍖nance.gov/ AllRegs Compliance Commentary: 2011 - The Year of the Bureau of Consumer Financial Protection. Whats Ahead for 2012? http://solutions.allregs.com/2011-the-year-of-the-bureau-of-consumer-鍖nancial-protection/ AllRegs Compliance Commentary: 2012: A Year for Proposals, 2013: A Year for Action http://solutions.allregs.com/2012-a-year-for-proposals-2013-a-year-for-action/ AllRegs Compliance Commentary: 2013 Regulatory Reform Series: Quali鍖ed Mortgage, High Cost Mortgages and Higher-Priced Mortgage Loans http://solutions.allregs.com/may-the-regulators-be-ever-in-your-favor/ AllRegs Compliance Commentary: CFPB Announces Implementation Plan for New Mortgage Rules http://solutions.allregs.com/cfpb-announces-implementation-plan-for-new-mortgage-rules/ AllRegs Compliance Commentary: CFPB Finalizes Mortgage Servicing Rules under RESPA and TILA http://solutions.allregs.com/cfpb-鍖nalizes-mortgage-servicing-rules-under-respa-and-tila/ AllRegs Compliance Commentary: CFPB Issues Ability-to-Repay and Quali鍖ed Mortgage Final Rule http://solutions.allregs.com/cfpb-issues-ability-to-repay-and-quali鍖ed-mortgage-鍖nal-rule/ AllRegs Compliance Commentary: CFPB Issues Rule to Protect Consumers from Irresponsible Mortgage Lending http://solutions.allregs.com/cfpb-issues-rule-to-protect-consumers-from-irresponsible-mortgage-lending/ AllRegs Compliance Commentary: CFPB Monitors Mortgage Servicing Transfer Activity http://solutions.allregs.com/cfpb-monitors-mortgage-servicing-transfer-activity/ AllRegs Compliance Commentary: CFPB Releases Consumer Complaint Data http://solutions.allregs.com/cfpb-releases-consumer-complaint-data/ Consumer Financial Protection Bureau lays out implementation plan for new mortgage rules by the CFPB http://www.consumer鍖nance.gov/pressreleases/consumer-鍖nancial-protection-bureau-lays-out-implementation-plan-for-new-mortgage-rules/ AllRegs Compliance Commentary: Financial Reform: The Bureau of Consumer Financial Protection http://solutions.allregs.com/pages/Bureau-of-Consumer-Financial-Protection.html The Woman Who Knew Too Much http://www.vanityfair.com/politics/features/2011/11/elizabeth-warren-201111 Servicing Examinations Alternative Mortgage Transaction Parity Act Interim Rule Consumer Complaints Whistleblower Protection Program Ombudsman Of鍖ce RESPA/TILA disclosures, Know Before You Owe Strong focus on issues related to Servicemembers Rede鍖ned con鍖dential treatment of privileged information Re-issuance of existing regulations now governed by the CFPB for public comment Restrictions on compensation including proxies or loan term restrictions on compensation Origination points and fees and zero-zero alternative Af鍖liate fees The effect of high-cost restrictions Bona 鍖de discount points Credit insurances Mandatory arbitration Equal Credit Opportunity Act Appraisal Disclosure modi鍖cation Loan Of鍖cer Compensation Revisions Include: 2010 2008 2012 Educate the public and consumers about 鍖nancial decisions and products Covered Persons any person or af鍖liate that provides a consumer 鍖nancial product What Does the CFPB Do? What Does the CFPB Regulate? The history of the CFPB is relatively short, but the impact this young bureau has over the mortgage industry is undeniable. John Doe Rede鍖ned rulemaking procedures by posting of regulatory documents on its website as of鍖cial, in lieu of the federal register publication, began regulating larger participants, such as credit reporting agencies The CFPB begins considering reformation to these mortgage topics Controversy and a 鍖libuster surround the appointment of Cordray, so President Obama appoints him during a recess The CFPB is able to start lawmaking at full speed Some Milestones from this Year Include the Following: Fall 2012: CFPB releases guidance on a Compliance Management System as part of its examination manual AllRegs All Reg s Disclaimer: The information presented in this infographic is not meant to be nor should it be construed as advice of legal counsel. The applicability of the information contained herein will vary based on the nature of each lending institution's business, under what law it was created, and its loan products and procedures. Readers are strongly urged to consult with their legal counsel and/or contact local counsel as appropriate in the various states and jurisdictions to determine the applicability of the materials contained herein to the speci鍖c facts and circumstances of each organization's programs and products and to identify other law applicable to its business operations. The information contained herein was not reviewed or approved by counsel in the respective jurisdictions. Copyright 2013 AllRegs. All Rights Reserved. To learn more about AllRegs CFPB Resources, including the Compliance Management System, visit http://solutions.allregs.com/compliance-management-system/. www.allregs.com www.allregs.com