The Consumer Financial Protection Bureau is nearly one year old, and a high ranking regulatory official from the agency says that although it is supposed to be monitoring a number of different sectors of the economy, a majority of the group's time and effort is being put toward the mortgage industry.
CFPB deputy director Raj Date made these comments during a recent Mortgage Bankers Association in New York City.
"We opened for business almost 10 months ago," Date said. "Since then, we’ve made tangible progress in a number of markets."
Additional areas the CFPB has strived to make a difference include the restructuring of bank policies on overdraft protection, short-term loan transparency and student loans. However, Date noted that most of the agency's time is being spent in the mortgage market in an effort to prevent the sector from experiencing another collapse like it did nearly six years ago.
The U.S. mortgage industry is currently one of the largest, most fluid and sophisticated markets in the world, he added. But accounting for the risk of careless lending and broad oversights that led to the housing market's collapse is a concentration of the lending regulation the CFPB is trying to enact.
Meanwhile, the agency isn't the only regulatory institution that is trying to make a difference in the mortgage industry. Recently, Center for Responsible Lending president Michael Calhoun spoke before the House of Representatives Committee on Financial Services, outlining a number of key areas of the mortgage market.
Primarily, Calhoun told regulators that abusive lending practices as a result of the current foreclosure crisis need to be addressed and eliminated. Research from CRL indicates that this crisis is nearly half over, and that financial abuse aimed at distressed borrowers, specifically minorities, need to be curbed.
Additionally, more financial reform needs to be made through agencies, such as the CFPB, to give consumers the protection they didn't have leading up to the financial crisis. Calhoun referenced the Dodd-Frank Act as the foundation on which to starts providing consumer protection to mortgage borrowers.
"The Consumer Financial Protection Bureau’s upcoming rulemaking on the Ability to Repay and Qualified Mortgage provisions in Dodd-Frank will be a critical reform, especially for communities that were targeted for mortgages with abusive and predatory terms," Calhoun said.