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Regulate the financial industry
Has authority over 19 regulations governing consumer finance, including broad enforcement
Analyze and study the financial landscape to make informed improvements
Manage complaints about financial 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 andCredit Union
Covered Persons” greater than $10 Billion in assets
“Service Providers”any person that provides a material serviceto a covered person in connection with the
offering or provision by such covered personof a consumer financial product or service
Elizabeth Warren, a Harvard law
professor, presents the idea for a
consumer protection agency
2007
Financial Collapse
2009
CFPB first 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
ServiceMembersStudent 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 final rules
The final version of the Ability-To-Repay Rule including:• Modifications to the Good Faith Determination of Borrower’s 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 defining the Qualified Mortgage (QM)/Ability-to-Repay (ATR) RuleThe QM/ATR Rule is significant because:• This rule will determine the loan products available to consumers for the indefinite 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-PricedMortgage Loans (HPML)• Expanded escrow account requirements • Additional appraisal requirements• Revised thresholds for determination
High-Cost Mortgages• Modified Counseling requirements • Revised thresholds for determination• Revised points and fees calculations
YOUR BILL
TOTAL: $
CFPB Releases Consumer Complaint DataThe launch expanded the CFPB’s Consumer Complaint Database significantlyfrom 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
2013Some Milestones from
this Year... So Far
Sources:
The CFPB Websitehttp://www.consumerfinance.gov/
AllRegs Compliance Commentary: 2011 - The Year of the Bureau of Consumer Financial Protection. What’s Ahead for 2012?http://solutions.allregs.com/2011-the-year-of-the-bureau-of-consumer-financial-protection/
AllRegs Compliance Commentary: 2012: A Year for Proposals, 2013: A Year for Actionhttp://solutions.allregs.com/2012-a-year-for-proposals-2013-a-year-for-action/
AllRegs Compliance Commentary: 2013 Regulatory Reform Series: Qualified Mortgage, High Cost Mortgages and Higher-Priced Mortgage Loanshttp://solutions.allregs.com/may-the-regulators-be-ever-in-your-favor/
AllRegs Compliance Commentary: CFPB Announces Implementation Plan for New Mortgage Ruleshttp://solutions.allregs.com/cfpb-announces-implementation-plan-for-new-mortgage-rules/
AllRegs Compliance Commentary: CFPB Finalizes Mortgage Servicing Rules under RESPA and TILAhttp://solutions.allregs.com/cfpb-finalizes-mortgage-servicing-rules-under-respa-and-tila/
AllRegs Compliance Commentary: CFPB Issues Ability-to-Repay and Qualified Mortgage Final Rulehttp://solutions.allregs.com/cfpb-issues-ability-to-repay-and-qualified-mortgage-final-rule/
AllRegs Compliance Commentary: CFPB Issues Rule to Protect Consumers from Irresponsible Mortgage Lendinghttp://solutions.allregs.com/cfpb-issues-rule-to-protect-consumers-from-irresponsible-mortgage-lending/
AllRegs Compliance Commentary: CFPB Monitors Mortgage Servicing Transfer Activityhttp://solutions.allregs.com/cfpb-monitors-mortgage-servicing-transfer-activity/
AllRegs Compliance Commentary: CFPB Releases Consumer Complaint Datahttp://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.consumerfinance.gov/pressreleases/consumer-financial-protection-bureau-lays-out-implementation-plan-for-new-mortgage-rules/
AllRegs Compliance Commentary: Financial Reform: The Bureau of Consumer Financial Protectionhttp://solutions.allregs.com/pages/Bureau-of-Consumer-Financial-Protection.html
The Woman Who Knew Too Muchhttp://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 Office
RESPA/TILA disclosures, “Know Before You Owe”
Strong focus on issues related to Servicemembers
Redefined confidential 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• Affiliate fees• The effect of high-cost restrictions• Bona fide discount points• Credit insurances• Mandatory arbitration
Equal Credit Opportunity ActAppraisal Disclosure
modification
Loan Officer Compensation Revisions Include:
2010
2008
2012
Educate the public and consumers about financial decisions and products
“Covered Persons” any person or affiliate
that provides a consumer financial product
What Doesthe CFPB Do?
What Doesthe CFPB Regulate?
The history of the CFPBis relatively short, but the impact
this young bureau has over the mortgage industry is undeniable.
John Doe
Redefined rulemaking procedures by posting of
regulatory documents on its website as official, 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 filibuster 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 itsexamination manual
AllRegs
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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 applicabilityof the materials contained herein to the specific 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
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