MortgageRegulatory

CFPB acts as safeguard, not a hindrance, to lending

The Consumer Financial Protection Bureau is often accused of making it harder for everyone to get a mortgage. But are they really the correct party to blame? The CFPB is designed as a safeguard to protect against unsafe lending, but in reality, the firm pulled back on legislation that would have seriously curtailed lending to low-income Americans. Per the Washington Post:

“The nature of lending is that until lenders fully understand the risks that they’re dealing with, they’re going to be extra conservative,” David Stevens, president of the Mortgage Bankers Association of America, said. “I think what we’re seeing is the banking system has become very risk averse…Their parent companies are literally instructing their mortgage subsidiaries to be very careful so this doesn’t happen again.”

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