The Colorado federal district court hearing NAIB, et al v. Weiser, et al., the lawsuit filed by three consumer financial services industry trade groups challenging Colorado’s opt-out legislation, has granted the plaintiffs’ motion for preliminary injunction.  As interpreted by the defendant State officials, Colo. Rev. Stat. § 5-13-106 (Opt-out Law), ), which is due to take effect on July 1, purports to apply Colorado’s interest rate and fee limits to interstate loans made by federally insured out-of-state state-chartered banks to Colorado borrowers. … Continue Reading

On June 19, 2024, the Fifth Circuit dissolved the district court’s order transferring the case challenging the CFPB’s credit card late fee rule.  In granting the writ of mandamus filed by the plaintiff trade associations challenging the rule, the three-judge panel rejected Judge Mark Pittman’s second order to transfer the case to D.C.… Continue Reading

The Consumer Financial Protection Bureau (CFPB), recently issued a Request for Information (RFI) related to fees charged by providers of mortgages and related settlement services. In his statement, Director Chopra discussed the impact of the increasing costs on lenders and consumers, and stated that the CFPB plans to address those costs.… Continue Reading

On June 10, 2024, the Supreme Court granted the petition for a writ of certiorari and issued a summary disposition in Flagstar Bank, N.A. v. Kivett. The Supreme Court vacated the judgment and remanded the case to the Ninth Circuit for further consideration in light of the court’s recent decision in Cantero v.… Continue Reading

In a blog post published at the end of last week, the CFPB announced that its payday lending rule (Rule) would go into effect on March 30, 2025.  Because the Rule’s ability to pay requirements were rescinded, the only remaining provisions of the Rule are its “payment provisions.”  Those provisions:

  • Prohibit lenders from attempting to withdraw payment for a covered loan from a borrower’s account after two consecutive attempts have failed due to lack of sufficient funds, unless the borrower specifically provides new authorization to do so; and
  • Require lenders to give consumers certain notices, such as advance notice before attempting to withdraw a payment for the first time and notice of the consumer’s rights when two consecutive payment attempts fail.
… Continue Reading

The U.S. Department of the Treasury (“Treasury”) has released a Request for Information on the Uses, Opportunities, and Risks of Artificial Intelligence (“AI”) in the Financial Services Sector (“RFI”).  Written comments are due by August 12, 2024. 

AI is a broad topic and the term is sometimes used indiscriminately; as the RFI suggests, most AI systems being used or contemplated in the financial services sector involve machine learning, which is a subset of AI. … Continue Reading

The steady drumbeat of steps during Rohit Chopra’s tenure as CFPB Director to call into question the reliability and predictability of medical debt information in credit underwriting reached a crescendo last week with the CFPB’s issuance of a proposed rule to eliminate the exception in Regulation V (which implements the Fair Credit Reporting Act) that currently allows creditors to obtain and use medical debt information in connection with credit eligibility determinations. … Continue Reading

On June 13, 2024, CFPB Director Rohit Chopra appeared before the House Financial Services Committee for a hearing, “The Semi-Annual Report of the Bureau of Consumer Financial Protection.” As we expected, the House Financial Services Committee also tackled the earnings issue raised by Senator John Kennedy (R-LA). We previously blogged that CFPB Director Rohit Chopra was dismissive of the argument that the CFPB was unlawfully funded out of losses of the Federal Reserve Banks.… Continue Reading

On June 4, 2024, the CFPB issued its Semi-Annual Report to Congress covering the period beginning April 1, 2023 and ending September 30, 2023. On June 12, 2024, CFPB Director Chopra appeared before the Senate Banking Committee for a hearing, “The Consumer Financial Protection Bureau’s Semi-Annual Report to Congress.” On June 13, 2024, Director Chopra appeared before the House Financial Services Committee for a hearing, “The Semi-Annual Report of the Bureau of Consumer Financial Protection.”… Continue Reading

Buyer-Broker Commissions

In connection with its guaranteed home loan program, the Department of Veterans Affairs (VA) recently adopted a temporary local variance allowing veterans to pay the commission of the real estate broker or agent assisting them (a “buyer-broker”). VA also recently urged servicers to implement a targeted foreclosure moratorium through year end, which would extend, with modifications, a previously announced moratorium.… Continue Reading