Alert October 02, 2012

CFPB Testifies About Semi-Annual Report

Director Richard Cordray testified before both the House Committee on Financial Services and the Senate Committee on Banking, Housing and Urban Affairs about the CFPB’s semi-annual report (see August 7, 2012 Alert). Mr. Cordray’s testimony discussed generally the CFPB’s activities for the period of January 1, 2012 through June 30, 2012, including the CFPB’s focus on mortgage servicing and “larger participants.” When questioned about industry calls for a safe harbor or rebuttable presumption under the impending qualified mortgage rule by members of the Committee on Financial Services, Mr. Cordray stated that the CFPB had not yet decided whether it would adopt a safe harbor rule to its impending qualified mortgage rule. Members of the House Committee on Financial Services were also concerned with the impact of the ability-to-pay rules, including, for example, the ability of stay-at-home spouses to obtain credit. Mr. Cordray testified that the CFPB plans to issue a new rule to correct this unintended consequence of the ability-to-pay rules.