The Consumer Financial Protection Bureau (CFPB) is proposing to allow a loan to become a Qualified Mortgage (QM) when it grows up. On August 18th, the CFPB issued a proposal that would amend the agency’s Ability-to-Repay (ATR) Rule to provide that a first-lien, fixed-rate loan meeting certain criteria, that the lender has held in its portfolio, could become a QM after 36 months of timely payments. Figuring that if a borrower has made payments on…

On July 30, 2020, the National Community Reinvestment Coalition (“NCRC”) and several other consumer advocacy organizations filed suit against the Consumer Financial Protection Bureau (“CFPB” or the “Bureau”), claiming that the Bureau’s recent Home Mortgage Disclosure Act (“HMDA”) rulemaking violates the Administrative Procedure Act (“APA”). The challenged rule increases the loan-volume reporting thresholds under Regulation C, which implements HMDA. Under the new rule, entities that originate fewer than 100 qualifying closed-end mortgage loans or fewer…

On July 28, 2020, the Consumer Financial Protection Bureau (CFPB or the Bureau) published a request for information (RFI) on opportunities for the Bureau to clarify the Equal Credit Opportunity Act’s (ECOA) implementing regulation, Regulation B, in a way that prevents credit discrimination and promotes credit access and innovation. The Bureau seeks feedback on a diverse set of topics, though the request is not limited to the below topics. Commenters are encouraged to address any…

On July 15, 2020, the Consumer Financial Protection Bureau filed a lawsuit against Townstone Financial, Inc., a Chicago-based mortgage lender and mortgage broker, alleging that Townstone “redlined” African-American neighborhoods in the Chicago Metropolitan Statistical Area and discouraged prospective applicants from applying to Townstone for mortgage loans on the basis of race. This marks the first time that a federal regulator has taken a public redlining action against a non-bank mortgage lender. Read more about the…

The Telephone Consumer Protection Act of 1991 (TCPA) prohibits most automated calls or texts to cell phones, but it makes an exception for calls or texts that seek to collect on U.S. government debts. Today, the Supreme Court held that this exception violates the First Amendment because it applies to only certain types of speech. Read more at Mayer Brown’s Supreme Court & Appellate Practice website.…

Nearly ten years after passage of the Dodd-Frank Act, the Supreme Court has finally put to bed the raging argument about whether it was constitutional for Congress to establish the Consumer Financial Protection Bureau (CFPB or Bureau) as an independent agency with a single Director removable by the President only for cause. In an anti-climactic end to nearly a decade of heated rhetoric, political battle and costly litigation, the Court held that the Bureau’s structure…

Earlier this week the CFPB released an interim final rule that allows mortgage servicers flexibility to offer additional short-term loss mitigation options to borrowers impacted by the COVID-19 pandemic.  The mortgage servicing rules include many requirements for the servicing of mortgage loans in default, including limitations on the types of loss mitigation that may be offered in certain instances.  The unique challenges facing servicers and borrowers in the wake of the pandemic, as well as…