March 3, 2015

CFPB's Cordray helps shed light on agency's plans

Consumer Financial Protection Bureau Director Richard Cordray took a minute to delve into some of the agency's current concerns, as well as the disagreements its staff are having. 

During a recent online town hall meeting with Debbie Matz, chair of the board for the National Credit Union Administration, Cordray emphasized that the staff of his organization are currently looking into revising regulations governing overdraft fees, according to Credit Union Times. 

CFPB priorities
However, he emphasized that the CFPB needs to look at various other matters before doing so, according to American Banker. 

"Overdraft is in the queue but not quite as upfront as some of the things I mentioned such as prepaid, payday and HMDA [Home Mortgage Disclosure Act]," Cordray told American Banker. "But we're thinking about it, we're working on it and happy to have input." 

Cordray spoke to a proposal the government agency floated Jan. 29, which would increase the threshold for lenders characterized under the qualified mortgage rules as either small or rural, according to American Banker. He mentioned that some staff members within the bureau opposed the idea, which would permit a larger number of lenders to grant qualified mortgage loans. 

Overdraft rules
When he did get to the overdraft rules, Cordray emphasized the premature nature of any information he could supply, noting that the CFPB has not even released a proposal involving changes yet, Credit Union Times reported.

However, he did note that the government agency is currently looking at several challenges surrounding overdraft fees that have thus far been the "bones of contention," including the incidence and size of fees, according to the Credit Union Times. 

Cordray noted that while the CFPB certainly does not plan to eliminate the overdraft product, the government agency will need to gather more information - including feedback from consumers - before making any decisions surrounding alterations or constraints, Credit Union Times reported. 

Auto lending
The CFPB has also been turning up the heat on auto lending and gave no signs that it plans to lay off in this particular area, according to American Banker. The government agency continues to examine certain auto lenders. Another practice the organization has kept up - even amidst opposition - is harnessing so-called disparate impact theory to credit auto lenders with unintentional discrimination. 

Cordray emphasized that the CFPB is still concerned about dealer markups and noted that it is something he dislikes personally, American Banker reported. Given the situation, the government agency will continue to work on overcoming the challenges surrounding auto lending.