Ten Things Elizabeth Warren’s Consumer Protection Agency Has Done for You

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This post originally appeared at Mother Jones.

Elizabeth Warren
Senator Elizabeth Warren (D-MA) listens to Consumer Financial Protection Bureau Director Richard Cordray's testimony at the Senate Banking Committee's hearing of the bureau's Semi-Annual Report to Congress. Washington, DC, November 12, 2013. (AP Photo/Jacquelyn Martin)

The Consumer Financial Protection Bureau (CFPB), the watchdog agency conceived of and established by Sen. Elizabeth Warren (D-MA) in the wake of the financial crisis, had a hard time getting on its feet. The GOP tried everything it could to hobble the bureau, but to no avail. Over the past couple of years, the CFPB has issued dozens of protections shielding consumers from shady practices by mortgage lenders, student loan servicers and credit card companies. Here are ten things the CFPB, which was created in 2011, has done to protect the little guy:

1. Mortgage lenders can no longer push you into a high-priced loan: Until recently, lenders were allowed to direct borrowers toward high-interest loans, which are more profitable for lenders, even if they qualified for a lower-cost mortgage — a practice that helped lead to the financial crisis. In early 2013, the CFPB issued a rule that effectively ends this conflict of interest.

2. New homeowners are less likely to be hit by foreclosure: In the lead-up to the financial crisis, lenders also sold Americans “no doc” mortgages that didn’t require borrowers to provide proof of income, assets or employment. Last May, the bureau clamped down on this type of irresponsible lending, forcing mortgage lenders to verify borrowers’ ability to repay.

3. If you are delinquent on your mortgage payments, loan servicers have to try harder to help you avoid foreclosure: During the housing crisis, loan servicers — companies that collect payments from borrowers — were permitted to simultaneously offer a delinquent borrower options to avoid foreclosure while moving to complete that foreclosure. New CFPB rules force servicers to make a good faith effort to keep you out of foreclosure. That’s not all: Loan servicers will now face civil penalties if they don’t provide live customer service, maintain accurate mortgage records and promptly inform borrowers whose loan modification applications are incomplete.

4. Millions of Americans get a low-cost home loan counselor: In January 2013, the CFPB required the vast majority of mortgage lenders to provide applicants with a list of free or low-cost housing counselors who can inform borrowers if they’re being ripped off.

5. Borrowers with high-cost mortgages get an outside eye: Lenders who sell mortgages with high interest rates are now required to have an outside appraiser determine the worth of the house for the borrower. If a borrower is going to be paying sky-high prices for a fixer-upper, at least she’ll know it beforehand.

6. Fly-by-night financial players will be held accountable: Part of the CFPB’s mandate is to oversee debt collectors, payday lenders and other under-regulated financial institutions that profit off low-income Americans. The bureau is preparing new restrictions on debt collectors and considering new regs on payday loan industry. In the meantime, the bureau is cracking down on bad actors individually.

7. Folks scammed by credit card companies get refunds: In October 2012, the CFPB ordered three American Express subsidiaries to pay 250,000 customers $85 million for illegal practices including misleading credit card offerings, age discrimination and excessive late fees. This past September, the CFPB ordered JPMorgan Chase to refund $309 million to more than 2.1 million Americans for charging them for identity theft and fraud monitoring services they didn’t ask for.

8. Student lenders face scrutiny: The CFPB oversees private student loan servicing at big banks to ensure compliance with fair lending laws. In December, the agency announced that it will also start supervising non-bank student loan servicers, which are companies that manage borrowers’ accounts. Many of these servicers have been accused of levying unfair penalty fees and making it hard for borrowers to negotiate an affordable repayment plan.

9. Service members get extra protection: In June, the CFPB ordered US Bank and its non-bank partner Dealers’ Financial Services to refund $6.5 million to service members for failing to disclose fees associated with a military auto loan program. In November, the CFPB ordered the payday lender Cash America to pay up to $14 million for illegally overcharging members of the military.

10. Consumers get a help center: If your bank or lender does anything you think is unfair, the bureau has a division dedicated to fielding consumer complaints. The agency promises to work with companies to try to fix consumers’ problems.

Erika Eichelberger is a reporter in Mother Jones' Washington bureau. Follow her on Twitter @eichelberger_e.
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  • Daniel Delgado

    great job Senator, God bless you.

  • C Osborn

    I really like Senator Warren….the CFPB not so much….
    I filed a complaint with the CFPB (April 2013) in regards to WHY JPMC did not submit/report the illegal foreclosure of my home to the National Mortgage Settlement as required by the terms of the Settlement. I had been assured in writing by the Indiana Attorney General (May 2012) that the illegal foreclosure (we only requested a Due Date Change…Dual-tracking…Robo-signing etc…) of my home of over 20 years would be included in the NMS. After filing my complaint with the CFPB and waiting several months for a response, I was told in an email that the CFPB agreed with JPMC in that, the ‘borrower’ had to file the complaint him/herself before the CFPB would address the complaint with JPMC. That would not have been a problem. However, had…IF the CFPB had actually read ANY part of my complaint FIRST before agreeing with JPMC and issuing their response to my complaint, then the CFPB would have known that the ‘borrower’ (my husband of 30 years) had dropped dead of a heart attack (Thanksgiving Day) 2-1/2 years previous while trying to save our home, therefore was unable to file the complaint with the CFPB himself. When I again contacted the CFPB to point out this FACT that they did not bother to read first, I was instructed to write an appeal to their response. The CFPB immediately cancelled my appeal response, telling me it was the ‘same’ complaint. Again, contacted the CFPB, this time I was assigned a ‘supervisor’ to look into my complaint. That was July 2013, still have not heard back from the CFPB as to WHY JPMC did not submit/report the illegal foreclosure of my home to be included in the National Mortgage Settlement or any other response for that matter. I am not the only homeowner who has NOT been helped, in any way whatsoever, by the CFPB.

  • FedupBanker

    The new reverse mortgage program is another faulty investment scheme. It takes the equity in your home by giving you a lump some cash amount. Requires you to live where you can not pay overheads. Many have large fees that require insurance by government agency.
    all which are taken from the value of your home.
    The old way to pay off a mortgage snd get title to your own property is gone forever.

  • MJKJ

    RE: #2 It was the Congress, in an effort to allow more people to buy homes, was behind the “no docs” scenario. Take a look at Barney Frank.

  • Anonymous

    But they still do not enforce any of those provisions if they decide not to follow them. And most financial entities are NOT following them. Their paperwork just makes it appear that they are. Our government is still acting like those loans are valid when they are not if MERS touched them and they were securitized. Loan mods are a sham in such cases. Those loans have already been paid off several times during a default by the time the loan mod offers roll around. The REMICs are being allowed to not pay taxes they should. The IRS is letting them slide and the government made special rules so they could. This lady means well, but the system itself helps this RICO type of financial crime wave to continue at the citizen’s expense. Study fractional banking and tell me who got assets for free. Sure wasn’t the borrower, although they put assets on a bank’s books when they sign for a loan. Report it all when you report this crap.

  • Anonymous

    No, it actually was the folks who put together those REMIC trusts. Most of whom vote republican. They paid brokers for the originating lenders yield spread premiums (many times in illegal amounts) to get massive amounts of loans into their pipeline. The larger the better since they got to borrow ten times the amount for themselves with that asset borrowers put on their books through fractional banking while putting up NONE OF THEIR OWN MONEY. They still didn’t have enough to fill those REMICs so they put placeholders entries into them and sold them as full and good anyway.

  • Anonymous

    If your loan was put into a REMIC trust, even if you pay it off you will not have clear title to your property. It is slandered and you will have to clear it yourself to give anything like a warranty deed to your buyer. You lost equity the minute they clouded title. Title companies will not insure MERS transfers. They write that into an exclusion clause now.

  • Anonymous

    This is a common complaint. Legal Aid got monies from the settlement to help folks too, but it was not enough and they are not able to help most of the folks who need it. This stuff and the loan mods are a sham to take attention away from the fact they are helping the banksters more than enforcing laws and helping people.

  • Mark Manville

    I’m sorry for your losses, both of your husband and your home. I work in a bureaucratic organization myself so I know (and have sometimes been guilty of perpetuating myself) that the true intent of an organization can get buried under the process and paperwork. Especially an organization whose funding (staffing) has been stymied at every point by the GOP, as the CFPB’s has like no other in recent history, those folks may be on a treadmill that’s going faster than they can keep up with.

    Is there any 3rd party in your area that you can get assistance in straightening this paperwork problem out? Maybe you could post your (general) location here, and someone else in your area can make a suggestion.

  • C Osborn

    Thank You. I do believe from what I have read that the CFPBs funding comes from the Federal Reserve…not the government, although it does seem that the ‘government’ for some reason does not want the CFPB to exist…to assist wronged consumers.

    I just wanted ONE SIMPLE question answered. Why was JPMC permitted to not report/submit the illegal foreclosure to the NMS as was required by the terms of the Settlement…period.

    If one visits the National Mortgage Settlement website….it clearly states that if there are questions and/or complaints to contact the CFPB for assistance. That is the ONLY reason I contacted the CFPB. I did not contact them for assistance with the illegal foreclosure.

    And yes, I also contacted the Indiana Attorney General’s office (again). This time, IN AG told me that if I wanted the answer to my ONE SIMPLE QUESTION concerning JPMC not following the terms of the NMS Agreement, then I MUST sign/have notarized/submit a MORTGAGE TRANSFER AGREEMENT with JPMC as well as submit tax returns W-2 etc before I could get an answer…..all on a home that was sold in 2012….a home that JPMC does not own and NEVER did!

  • C Osborn

    Yes, I tried Legal Aid also. They told me they did not have the ‘experience’ to handle a case like mine.

    Also paid an attorney. Unfortunately, it wasn’t until after I went to the courthouse to have entire case documents copied that I discovered…

    1) My attorney LIED about a continuance that he had already filed on my behalf, telling me instead that JPMC requested the continuance.
    2) My attorney NEVER notified me of the re-scheduled hearing.
    3) My attorney did NOT attend the re-scheduled hearing.
    4) My attorney did NOT notify me that my counter-claim had been dismissed, due to his no-show.
    5) My attorney did NOT notify me of the 30 day time limit to file an Appeal.

    So yea….I’m not too enamored of our LEGAL system….

  • Carol

    If they just stopped foreclosures, something would happen. It is a mess, still. It must be much more drastic to change this and for those who already lost homes, they must be repaid by the crooks that stole them, our lovely, profitable banks.

  • http://www.ccrider27.com/ ccrider27

    …and puppies and kitties and cotton candy and sugar plum fairies.

    What a ridiculously biased and one-sided article from Mother Jones the most biased, Democrat cheerleading publication on the web. I am greatly disappointed in Mr. Moyers, who at one stage in his career used to actually be an investigative reporter, for allowing such a false and one-sided article to be printed under his name.

    First of all Warren didn’t do any of the above. She did a lot of grandstanding and then compliantly took second fiddle to Geithner and when the grandstanding stage was over and the real work began she split.

    The “Ten Things” are all Democrat talking points about what the agency should be doing. But if you want to know what the agency is actually doing, read C Osborn’s situation in this comment section. She is not alone. There are thousands like her.

    Does anybody actually believe that the Dems under Obama, who has stocked his cabinet with Wall Street insiders, and protects them at every opportunity is going to do any of that?

    Perhaps you should read the IG report released this week showing that Obama’s DOJ has done everything in its power NOT to bring Wall Street to justice. See the NYTimes’ G. Morgenson’s objective report. Moyers won’t allow the link.

    Never listen to what they say.

    Only watch what they DO.

    Republicans are the obvious evil.

    Democrats are the effective evil.

    R = D = NO DIFFERENCE (other than empty rhetoric like this article)

  • http://www.ccrider27.com/ ccrider27

    I’d like to know more about MERS and REMICS.

    Do you have any guidance for where to pick up this information?

    I checked Wikipedia. It gave a one sentence mention to the REMICS, and re-REMICS’ role in the 2007 collapse. It did not go into detail regarding MERS and the title problems to which you refer.

    Warning: Don’t put an obvious link in any reply. Moyers doesn’t allow that. Just put in enough info to do a search.

    Thanks!