Captives To Face CFPB Oversight
September 18th, 2014 2:06 PM Share
New rules being announced by the Consumer Financial Protection Bureau would mean that the captive finance arms would be subject to oversight from the CFPB.
Automotive News reports that the CFPB will now have jurisdiction over “nonbank lenders” that “make, acquire, or refinance 10,000 or more loans or leases in a year.” This rule would encompass virtually all captive finance arms, covering a total of 38 lenders that originate roughly 90 percent of nonbank auto loans and leases.
Until now, the CFPB has not defined its cutoff point for overseeing “larger participants”, which largely included financial institutions. But the new definition brings auto maker finance arms under the CFPBs umbrella, something which has been expected for some time.
Published September 18th, 2014 2:06 PM
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Consumer Financial Protection Bureau: such an Orwellian name. "Automotive News reports that the CFPB will now have jurisdiction over “nonbank lenders” that “make, acquire, or refinance 10,000 or more loans or leases in a year.”" So... who's protecting consumer finances from the certified banksters? Serious question.
I've looked over, learned about the CFPB Guidelines for mortgages and such, and IMHO they are mostly a waste of paper. Alot of good/helpful idea, that are very confusing, so many days this, so many days that, and this coming from a lawyer. The big problem is that they do not have any real consequences for not following the guidelines. Maybe in the big picture, but there's nothing like "You messed up a loan mod, so you get fined for it" or something like that.
After reading all the comments here re the CFPB, I was compelled to add my 2-cents. My perspective is a little different because I think that the CFPB does nothing to protect the lenders from borrowers who willfully and often fraudulently overstate their assets and income in order to get a loan for whatever, but then are the first to holler and scream that they've been financially raped or otherwise wronged by the lender. The concept of the CFPB may be sound, but the practical application of the concept can often result in a lender being punished for something that the borrowers readily agreed to beforehand in order to get that loan. Caveat Emptor, yet no recourse against borrowers who cannot repay their debts.