The sudden financial impact of the COVID-19 pandemic on consumers has led to calls for loan servicers and other interested parties to provide temporary or permanent relief for borrowers who are unable to continue making loan payments. The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), guidance in the…
The first wave of class actions relating to the COVID-19 pandemic is here, including a number of cases concerning so-called “gating” eligibility rules that are legitimately applied by many lenders to manage the flow of applications for the U.S. Small Business Administration (SBA) Paycheck Protection Program (PPP). We expect these…
On May 10, 2017, the Consumer Financial Protection Bureau (CFPB) began gathering information regarding small business financing needs in an effort to encourage small businesses—especially ones owned by minorities and women. The Bureau began this process by issuing a Request for Information (RFI) seeking information from the public on a variety…
On December 16, 2016, the fair lending team at the Consumer Financial Protection Bureau (CFPB) announced the markets that it would closely monitor in 2017. These new monitoring priorities are part of the general priority goals announced by the CFPB in 2016, which included: 1) regulating the use of arbitration clauses; 2) addressing…
On December 21, 2016, the ranking member of the U.S. Senate Banking, Housing and Urban Affairs Committee, Senator Sherrod Brown (D-OH), sent a pointed letter to President-elect Trump’s nominee for Treasury Secretary, Steven Mnuchin. The letter is an attempt to gain an understanding of Mr. Mnuchin’s views on topics over which…
On June 22, 2016, the CFPB issued a Mortgage Servicing Supervisory Highlights Special Edition Report, and concluded that mortgage servicers may be violating the servicing rules that the CFPB enacted in January 2014, as a result of servicers’ continued reliance on ineffective technology. In addition, the press release accompanying the…
On May 10, 2016, the U.S. Treasury Department released a white paper entitled, “Opportunities and Challenges in Online Marketplace Lending.” The white paper is the result of a request for information that elicited more than 100 industry responses, and it reviews the benefits and risks of online marketplace lending before making…
The U.S. Department of Housing and Urban Development (HUD) reached a settlement agreement with Associated Bank concerning allegations that the Bank violated Section 804(b) of the Fair Housing Act. According to the conciliation agreement, HUD alleged that the Bank disproportionately denied loan applications of African-American and Hispanic applicants, and under-served…
On September 18, CFPB Director Richard Cordray delivered remarks at a Field Hearing about CFPB’s latest proposed rule, which would allow it to begin regulating “captive” finance companies – those entities owned by automotive manufacturers “for the primary purpose of facilitating sales for their parent companies and associated dealers.” In his…
The Federal Reserve Board recently made headlines when it repealed its Regulation AA to comply with the Dodd-Frank Act, leading some to wonder how, and to what extent, regulation of financial institutions might change going forward. But the federal agencies charged with regulating banking and credit activities have made it clear that they will continue to enforce prohibitions…
Synchrony Bank (formerly known as GE Capital Retail Bank) made two direct mail offers to its credit card holders, but it did not send the offers to Spanish-speaking customers. The Bank self-reported its actions, resulting in consent orders with the Consumer Financial Protection Bureau and the Department of Justice, which…
“Fair lending requirements apply throughout the life of the loan!” That was the message delivered by federal regulators in October 2013, reminding loan servicers that they are subject to fair lending liability and must manage their fair lending risks. In its May/June 2014 issue, the American Bankers Association’s Bank Compliance…
On January 28, 2014, a federal judge indicated that home loan borrowers in California may bring breach of contract claims against their loan servicer if the servicer offers a permanent loan modification agreement that differs from what was advertised in communications before the borrowers entered into the prerequisite Trial Period…