The Consumer Financial Protection Bureau (CFPB) is considered by many as a 21st century agency that assists consumer finance markets function properly by coming up with rules that make the market much more effective. The agency is also tasked with the role of fairly and consistently enforcing the said rules so as to empowering consumers to take more control over their economic livelihoods.
The CFPB was established by congress through the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, with Rich Cordray being appointed the first director of the CFPB in January 2012. The organization works to give consumers the information they need so as to understand the terms of their agreements with financial institutions.
Several large loan service companies supports and follows CFDB guidelines. These consumers can still obtain Personal Loans for People with Really Bad Credit and they have supporting programs. To understand more we will look at consumer protection through the CFDB.
How CFDB Protects Consumers
It is important to note from the onset that in America, equal access to credit is law. In this regard, Federal laws guaranteeing every American fair housing and equal credit opportunity do provide for penalties to those who may for one reason or the other violate these protections. On anything that’s concerns credit, CFPB is the leading enforcement agency that works with other federal agencies to ensure that these laws are upheld and followed.
Since its establishment, the organization has strived to protect consumers by coming up with and implementing federal consumer financial laws. It ensures this by writing rules, supervising companies and strictly enforcing federal consumer financial protection laws that support fairness for consumers. The body has also strives to restrict deceptive, unfair, or abusive practices and acts which are detrimental to the general well being of the consumer. Further to the above, the CFPB does also take consumer complaints on a wide range of financial transactions that include but are not limited to installment loans.
The agency also promotes financial education, undertakes research concerning consumer behavior, continuously monitors the financial markets for any new risks to consumers and enforces laws that outlaw unfair treatment and discrimination in the field of consumer finance. All these measures ensure that whichever facility or financial instrument a consumer opts for, be it a payday loan, a vehicle title loan or any other high cost installment loan; his interests are not only taken into consideration but are jealously safeguarded by law. These reputable companies that offer Online Loans for Bad Credit can usually approve people very quickly.
Since its inception, the CFPB has made significant strides in trying to streamline the installments loans industry in particular and the financial industry in general. Just one day after coming into existence, the body issued its very first stop-gap mortgage rule by issuing an amendment to what’s known as the Alternative Mortgage Transaction Parity Act of 1982; allowing state licensed loan originators to make different or alternative mortgages under federal law rather than state law.
The CFPB also partnered with the FHFA (Federal Housing Finance Agency) to start collecting important data for developing a national mortgage database. It has also gone ahead and launched the National Mortgage Servicing Rules and changed the face of mortgage lending by the introduction of the Qualified Mortgage Rule and the Ability to pay rule.
Since opening its doors for business, CFPB has received more than 300,000 complaints and still counting. As a matter of fact, debt collection of installment loans such as vehicle title loans, payday loans and other high cost installment loans form the largest source of complaints received by the CFPB, averaging 5,900 complaints per month with mortgage complains coming a close second with 4,900 complaints a month.
Over the years, CFPB has taken action against many financial services company which have fallen short. Early 2013, one of the leading mortgage companies Castle & Cooke Mortgage did receive a consent order from the mortgage company to pay $ 4 million in civil penalties and $ 9 million in restitution for consumers for allegedly steering them into more expensive mortgages. In December 2013, OCN (Ocwen Financial Corp) agreed to offer a mind boggling $ 2 billion on consumer relief and pay a total of $ 127.3 million to settle an investigation carried out with regards to its servicing practices.
In 2015, the agency took action against two of the top mega banks namely JPMorgan Chase and Wells Fargo for an illegal marketing services kickback scheme that they participated in with a title company. JPMorgan will be required to pay $ 600,000 in civil penalties and $ 11.1 million in redress to consumers whose loans were involved in this particular scheme. Wells Fargo would be required to pay $ 24 million in civil penalties.