The consumer financial services industry continues to evolve almost daily. Consumer Finance Law Ledger monitors developments at the Consumer Financial Protection Bureau, as well as trends, court decisions and enforcement actions. This blog covers consumer lending, collections, bankruptcy, foreclosure, and loan servicing and origination.

Recent Blog Posts

  • Senate Overturns CFPB’s Arbitration Rule On Tuesday evening, the U.S. Senate voted to overturn the Consumer Financial Protections Bureau’s (CFPB) rule prohibiting arbitration clauses containing class actions bans. Vice President Mike Pence broke the 50-50 tie. All Republicans, with the exception of Lindsey Graham and John Kennedy voted against it. Both the Office of the Comptroller of Currency and the U.S. Department of Treasury had previously spoken out against the arbitration rule, arguing that it had the potential to harm consumers and did not offer... More
  • Don’t Wait Until It’s Too Late: Statute of Limitations for Negligent Appraisal Runs From Date of Closing When making a loan secured by a mortgage on residential real property, lenders typically order an appraisal and rely upon the value provided by that appraisal. How quickly must a lender sue an appraiser if the appraisal was negligently performed and the property was worth less than the appraised value? It seems logical that a lender would first have to wait for the borrower to default, foreclose on the property, and sell the property for a loss. However, Florida’s First District Court of... More
  • The CFPB Takes Action To Ban Credit Repair Company On August 30, 2017, the Consumer Financial Protection Bureau (CFPB) and Prime Marketing Holdings L.L.C. filed their proposed stipulated final judgment and order in United States District Court, the Central District of California to resolve a lawsuit the CFPB originally filed in September of 2016. In the proposed final judgment, it is alleged that Prime Marketing Holdings L.L.C. illegally charged advance fees and misled consumers as to the cost of credit repair fees. It is alleged that in its approximately two... More
  • Implications of the CFPB’s Arbitration Rule On July 10, 2017, the Consumer Financial Protection Bureau issued its arbitration agreements rule which implemented Section 1028(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act.  The rule will become effective September 18, 2017 and will affect agreements entered into on or after March 19, 2018. The arbitration agreements rule prohibits pre-dispute arbitration agreements in class actions related to certain “covered” products or services unless and until a court has ruled that a case may not proceed as a... More
  • 3 Takeaways from the CFPB’s Report on Strategies for Promoting Diversity and Inclusion in the Mortgage Industry On April 27, 2017, the CFPB issued a report on strategies for promoting diversity and inclusion in the mortgage industry. The report identifies what many people are already aware of, a company that promotes and encourages a culture of diversity and inclusion is not only a much better environment for its employees, it also makes an organization more profitable. Copyright: luckybusiness / 123RF Stock Photo Reading between the lines, many of the recent enforcement actions brought by the CFPB have focused on... More
  • So Who Really Is A ‘Debt Collector’ Under the FDCPA? Copyright: Blakeley / 123RF Stock Photo In an Alert published on June 13, Joshua Horn examines the U.S. Supreme Court’s decision in Henson, et al. v. Santander Consumer USA, Inc.: When the Fair Debt Collection Practices Act became law in 1977, it promised to regulate the conduct of anyone who “regularly collects or attempts to collect … debts owed or due … another.” But the courts have divided over an important question about the scope of the law. The split among the federal circuit courts... More
  • Better Late Than Never: Supreme Court Rules Creditor’s Time-Barred Proof Of Claim Comports With The FDCPA In the Midland Funding, LLC v. Johnson opinion, released by the United States Supreme Court (the “Court”) on May 15, 2017, the Court ruled that a creditor’s filing of an obviously time-barred proof of claim is not a false, deceptive, misleading, unfair, or unconscionable debt collection practice under the Fair Debt Collect Practices Act, 15 U.S.C. §§1692 et seq. (the “Act”).  The Johnson decision settles a disagreement among the Courts of Appeals regarding the propriety of the practice under the... More
  • The CFPB and Small Business While the CFPB is generally thought of as a consumer protection agency, the CFPB also has authority to protect small business owners as well. Specifically, Section 1071 of the Dodd-Frank Wall Street Reform and Consumer Protection Act amends the Equal Credit Opportunity Act (“ECOA”) to require financial institutions to compile, maintain, and report information concerning credit applications made by women-owned, minority owned and small businesses. Copyright: olegdudko / 123RF Stock Photo The Request for Information will be used to help the CFPB... More
  • RESPA and Regulation X Qualified Written Requests: Sending Acknowledgment of Receipt Directly to Borrower The United States District Court for the Southern District of Florida recently addressed an issue that may arise when a lender or servicer must acknowledge receipt of a written request for information. In Shelisa Todd v. Ocwen Loan Servicing, LLC, U.S.D.C. S.D. Fla. Case No. 17-cv-60454-BLOOM/Valle, U.S District Court Judge Beth Bloom dismissed a borrower’s claim with prejudice, finding that an acknowledgement letter that was sent directly to the borrower will bar a claim that the lender or servicer failed to... More