Regulatory reform

The agency announced it was rescinding seven policy statements issued last year meant to help companies combat fallout from COVID-19 but that the bureau's current chief said came at the expense of consumers.

By purchasing additional assets and securities, the Federal Reserve provided the financial markets with enough liquidity to weather the pandemic recession. But with the economy starting to recover, it needs to reduce such funding before it creates dangerous bubbles over the long term, say two former bankers.

In its final days, the Trump administration imposed limits on Fannie Mae and Freddie Mac’s holdings of mortgages with loan-to-value ratios above 90% and certain other characteristics. Critics say the changes were unnecessary and disproportionately penalize borrowers of color.

The administration faces a slew of immediate financial policy tasks, such as passing a new round of small-business aid, charting a course for Fannie Mae and Freddie Mac and filling vacant agency leadership posts.

The FHFA and Treasury will allow Fannie Mae and Freddie Mac to hold more capital as part of the Trump administration's plans to release the companies from conservatorship. But it is unclear whether the incoming Biden administration will keep the mortgage giants on the same reform path.

The agency that supervises Fannie Mae and Freddie Mac has pushed for revising an agreement with the Treasury Department allowing the mortgage giants to retain their profits. A deal could be out of reach once Joe Biden takes office.

In the waning days of the Trump administration, the agency issued a new legal theory of its power to let national banks evade state consumer protection laws. But some state attorneys general and consumer groups charge the federal regulator is attempting to sidestep restrictions imposed by Dodd-Frank.

The top Democrats on the House and Senate banking committees urged the Trump administration to pull the plug on any steps to overhaul Fannie Mae and Freddie Mac with the pandemic still taking a toll on the economy.

The proposal would require the government-sponsored enterprises to craft resolution plans similar to regulations imposed on the largest U.S. banks.

The consumer bureau's revamp of criteria for "qualified mortgages," a special regulatory class of loans free from liability, emphasizes pricing instead of a borrower's debt-to-income ratio.

The former FDIC chief oversaw the resolution of hundreds of failed banks during the financial crisis and knows how to build relationships with regulators. Those skills could be crucial in helping Fannie exit federal control.

With a Democrat set to take the White House in January, the agenda for agencies like the CFPB could undergo a rapid transformation, housing finance reform could be turned on its head and progressive banking ideas that were unthinkable over the past four years could gain traction.

If days go by without a clear result, the uncertainty could lead to market volatility, put off talks for a stimulus plan and complicate bankers' planning for a potentially new regulatory environment.

The agency finalized a rule to determine which party in a loan sale is subject to regulatory requirements. Advocates charged that the move will help predatory lenders.

Kathy Kraninger’s job status would be in question if Joe Biden wins the White House. If the president is reelected, she may continue balancing a deregulatory agenda with her unexpectedly tough stance on enforcement.

New research reveals the financial services industry both prefers and predicts an incumbent win in November.

Legislation favorable to the industry would be unlikely to pass in a divided Congress, but the biggest benefit for banks and credit unions of Republicans' retaining control of the chamber would be defending against the disruption of a Democratic blue wave.

The financial industry has praised the measured approach taken in a pending regulation on permitted communications with consumers. But two recent complaints by the bureau against debt collectors reflect a potentially aggressive enforcement stance.

The Federal Housing Finance Agency's proposal could undermine the companies’ mission to support the housing market and penalize consumers in underserved communities, industry and consumer groups say.

The agency’s plan to extend the "qualified mortgage" stamp of approval to more loans could help lenders that rely on alternative data and cushion the blow of other QM changes for Fannie Mae and Freddie Mac.