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Here’s how TRID is changing the mortgage industry

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House chairman denies CFPB head testimony

Richard Cordray is set to deliver his semi-annual report to the Senate Banking Committee Tuesday, but he’s not welcome to do the same before the House Financial Services Committee.

Rep. Jeb Hensarling, R-TX, refuses to hear Cordray’s report until he is "validly appointed" as the Consumer Financial Protection Bureau’s director. 

President Barak Obama installed Cordray in the position in early 2012 using a recess appointment. A federal court has invalidated three other recess appointments the president made the same day, calling into question Cordray’s position.

"Absent contrary guidance from the United States Supreme Court, you do not meet the statutory requirements of a validly-serving director of the CFPB, and cannot be recognized as such," Hensarling said.

The chairman and many other Senate Republicans have sought to make changes to the CFPB’s structure that would make the bureau accountable. 

"No other regulator has more influence over the daily financial lives of Americans," Hensarling said. 

He added, "Dodd-Frank gives the CFPB director the power to decide what financial products and services will – and will not – be available to American consumers and how much they will have to pay for them. How is it fair to American consumers that one unelected, unaccountable bureaucrat in Washington has the power to decide what kind of mortgage, car loan or credit card they can or cannot have?"

The main complaint about the CFPB is that Congress does not have enough oversight on its activities. The bureau gets funding directly from the Federal Reserve, not through the congressional appointee process, Hensarling explained.

Nonetheless, the chairman said that his committee "intends to conduct rigorous oversight of the CFPB’s activities" and will accept testimonies from other CFPB officials.

In contrast, Rep. Maxine Waters, D-Calif., said Cordray should be allow to testify.

"Until the Supreme Court rules on the constitutionality of Director Cordray's appointment as part of the National Bank of Big Spring et al v. Geithner case, or any other case that directly challenges the constitutionality of Director Cordray's appointment, he is the Director of the CFPB and must be treated as such," Waters explained.

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