Consumer lending

The Consumer Financial Protection Bureau will conduct supervisory exams of nonbank fintech companies that pose risks to consumers as Director Rohit Chopra seeks to level the regulatory playing field with supervised banks.

The subprime auto lender has a good track record, but there are concerns about used-car prices normalizing, according to KBRA.

Vice President Kamala Harris will announce new steps designed to reduce the cost of federal home loans for Americans saddled with medical debt and make it easier for veterans to have loans forgiven, as part of a White House push to help the millions facing unpaid health care bills.

The Biden administration once again extended the pause on student loan payments enacted to help borrowers during the COVID-19 pandemic, this time through the end of August.

The company has filed a lawsuit against the banking commissioner for threatening to end its partnership with a bank that enables consumer loans to exceed the state’s 36% interest rate cap. OppFi’s argument: Its bank partner is the true lender.

Lawmakers in New Mexico recently approved a stringent rate limit, and similar efforts are underway in Rhode Island and Michigan. The state-level actions are among the "numerous headwinds" facing high-cost lenders, one analyst said.

CFPB Director Rohit Chopra said the bureau is concerned that the spike in car prices, due partly to the global chip shortage, could create incentives for servicers to illegally seize vehicles for their resale value.

The Silicon Valley fintech expects to make $1.5 billion in auto loans this year after implementing key elements needed to achieve scale, said CEO David Girouard. The expansion comes as the automotive market continues to boom.

The company has agreed to pay at least $3.75 million to resolve allegations that it violated the District of Columbia’s 24% interest rate cap.

The deal is the latest example of a mainstream bank buying a point-of-sale lender focused on financing home improvement projects.

President Biden’s aspirations for aggressive forgiveness haven’t been fulfilled to date, but steps taken so far have lowered a key hurdle to entry-level homeownership.

Initial overcollateralization is 15%, with a build up to a target equal to the minimum of 21.5% of the current pool balance, and 16.5% of the initial pool balance.

The deal’s sponsor has issued a small rated portion to investors and sold the remainder back to loan-originator.

The sponsor’s Fortune 500 parent provides comfort in the face of the subprime-auto industry’s woes.

Trustmark Bank agreed to pay $9 million to resolve allegations that it discriminated against Black and Hispanic residents in Memphis, Tennessee. Attorney General Merrick Garland said the Department of Justice and other agencies will continue their crackdown.

The industry is prioritizing Black and Hispanic consumers in the interest of social equity and to tap new markets amid declining refinance volume and rising rates.

Banks, credit card issuers and debt collectors all supported the Consumer Financial Protection Bureau’s revised regulations. But they face a steep learning curve in complying with the rules, which take effect Nov. 30.

To help determine certain forms of credit enhancement and loss triggers, LendingPoint 2021-B is tightening its definition of what a charged-off account is.

The trust excludes loans from about six states with active legislation addressing the exporting of usury rates to out-of-state borrowers.

Known as MOHELA 2021-3, the trust will issue a mix of fixed- and floating-rate notes from a capital structure with three tranches, or note classes.