Incoming CFPB Director invites hope, fear of mortgage deals

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After a lengthy process between nomination and confirmation, which came mainly from optics and politics, Rohit became Chopra Confirmed by the US Senate after a largely bipartisan vote for the third full-time director of the Consumer Financial Protection Bureau (CFPB) late last month.

Shortly before President Joe Biden’s inauguration, Chopra was appointed by Biden as the new director of the Consumer Protection Agency. Authorization effectively given to Biden through a Supreme Court case supported by both the previous government and the former CFPB director herself. It immediately became clear that the new president was aiming to return the CFPB to a regulatory position that was very reminiscent of the Bureau under President Barack Obama’s administration, with Chopra being a major indicator of that idea for some.

The reverse mortgage industry has a particular interest in CFPB affairs as it is the government agency responsible for regulating the industry at the national level. While certain people in the industry have different opinions about the office itself, those who speak for the industry describe a hopeful attitude towards working with the agency to make sure they can help seniors working in their homes want to stay.

Potential focus areas of the CFPB under Chopra

As for the broader response to the confirmation of new Director Chopra, the former Federal Trade Commissioner’s experience in the government and in the office itself could prove useful to the internal operations of the CFPB and the entities that regularly interact with it. This is what Joseph Lynyak III, a partner at the international law firm Dorsey & Whitney and an expert on regulatory reform and CFPB, says.

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Rohit Chopra

“Director Chopra brings a wealth of government administration experience and direct knowledge of the CFPB himself,” says Lynyak. “He was present in the organization of the GFPB and actively participated in the development of high-level policy, including the enforcement strategy.”

Natural questions arising from Chopra’s affirmation usually revolve around whether or not the bureau will revert to an aggressive enforcement strategy and whether the bureau will focus the litigation on larger banks and mortgage lenders or smaller non-bank participants like payday lenders and debt Collectors, says Lynyak.

“In any case, it seems clear that fair lending compliance will be a priority again, and lenders of all sizes should start reviewing their statistics and fair lending practices,” he added.

Reverse Mortgage Industry Response

Regarding the reverse mortgage industry’s specific response to Chopra’s endorsement, the National Reverse Mortgage Lenders Association (NRMLA) has stated that it hopes to work productively with the CFPB. This relationship has been maintained since the agency was founded a decade ago.

“We congratulate Rohit Chopra on his appointment,” said Steve Irwin, President of NRMLA, in a telephone conversation with RMD. “We wish him all the best and look forward to continuing our engagement with the Office of Older Americans and the Office of Mortgage Markets.”

Prior to Chopra’s confirmation, the CFPB had taken two notable measures against reverse mortgage lenders during the Biden administration, both of which were in some way aimed at promoting the industry. The first took place last April, wherein the Bureau reached an agreement with Nationwide Equities of Mahwah, New Jersey, over advertising practices which it termed “fraudulent” and accused the lender’s materials of the Mortgage Acts and Practices Advertising Rule (MAP Rule) and the Truth in Lending Act (TILA) to violate. and the Consumer Financial Protection Act of 2010 (CFPA).

More recently, the CFPB enclosed with American Advisors Group (AAG), the industry leader in reverse mortgages, claims the lender sent fraudulent and inflated property estimates direct mail to borrowers in an attempt to convince consumers to take out a reverse mortgage. According to the court record, the direct mail order companies advertised a prominent “home equity appraisal,” which the CFPB claimed in an accompanying complaint was excessive.

The CFPB has taken both mortgage-related measures under the direction of Acting Director Dave Uejio, who will move to a position at the US Department of Housing and Urban Development (HUD) after the new Director Chopra is sworn in.

Broader responses to Chopra’s confirmation

The institutional response to Chopra’s confirmation has been generally positive. Among them, Bill Himpler, President and CEO of the American Financial Services Association (AFSA), describes a productive past working relationship with Chopra and hopes to continue it during his tenure as CFPB director.

“Over the years AFSA and its members have had the opportunity to work with Rohit Chopra, both during his time as commissioner with the Federal Trade Commission and during his previous tenure as a senior executive with the Consumer Financial Protection Bureau,” said Himpler in a Opinion. “In working with our industry, Mr. Chopra has always been gracious with his time and has taken into account the views of the consumer credit industry. We congratulate Mr. Chopra on his confirmation by the CFPB Senate and look forward to working constructively with him on a consumer-friendly policy that guarantees access to credit. “

The hope of a productive collaboration was also shared by Rob Nichols, President and CEO of the American Bankers Association (ABA), in a statement published shortly after Chopra’s confirmation.

“We congratulate Rohit Chopra on his confirmation to serve as the next director of the Consumer Financial Protection Bureau, which has the important role of overseeing our highly competitive financial services market and protecting consumers,” said Nichols. “We look forward to working with him to ensure that consumers continue to have access to the financial products and services they want and need with the protection they deserve.”

While consumers and affordable housing advocates have largely praised Chopra’s endorsement, other industry stakeholders are open with their concerns about being embroiled in a spate of potential activity by the CFPB director, as reported by HousingWire Senior Mortgage Reporter Georgia Kromrei in a current story Appeared in the sister publication of RMD.

“Rather than issuing clear, predictable guidelines, the mortgage industry fears that the CFPB will take headline-grabbing, high-profile enforcement action,” the story reads. “Some, including senior Senate banking committee member, Pennsylvania Republican Pat Toomey, have said the CFPB gets involved in regulation through enforcement.”

In fact, prior to the confirmatory vote, Senator Toomey verbally blasted Chopra’s nomination, saying he would turn the CFPB into “the breakaway, unaccountable anti-economic agency that it was during the Obama administration, and we have every reason to be the assumption that he will continue ”. ignoring legitimate control requests from Congress. “


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