The Consumer Financial Protection Bureau says it is making a serious push for accountability as exhibited in its activities this year from January through June, including a reverse mortgage market study. In testimony before the House Financial Services Committee to be delivered this week, CFPB Director Cordray underlines some of the progress the bureau has made in 2012. Among the highlights: the reverse mortgage study, revamping some mortgage market procedures and protecting older Americans.
The agency released a 200-plus page report on reverse mortgages in June, finding consumers were aware of reverse mortgages but few understood the products. The report and response to it will help drive policy going forward, according to the CFPB.
“Through our regulatory tools, we have proposed smarter rules that will help fix the broken mortgage market with common-sense solutions. We are writing rules that simplify mortgage disclosure forms and rules that make sure consumers do not receive mortgages that they do not understand or cannot afford,” Cordray said in prepared remarks. “Our rules will also bring greater transparency and accountability to mortgage servicing. And our careful process is that before we propose a rule, a team of attorneys, economists, and market experts evaluates its potential impacts, burdens, and benefits for consumers, providers, and the market.”
He also noted the bureau has received 72,297 consumer complaints about credit cards, mortgages, and other financial products and services, and the pace of complaints has been increasing over the past year.
“We conduct our own in-depth studies on consumer financial products, such as reverse mortgages and private student loans,” he said “We have issued public requests for information that seek input from consumers, industry, and other stakeholders on issues such as overdraft fees, prepaid cards, and the financial exploitation of seniors.”
Despite the fact that the bureau did not interview any reverse mortgage borrowers in preparation for its report, Cordray notes the importance of talking with consumers firsthand.
“We also think it is important to engage directly with consumers so we know more about the struggles and frustrations they encounter in their daily lives,” he said.
Written by Elizabeth Ecker