News & Analysis as of

Consumer Lenders Borrowers

Orrick, Herrington & Sutcliffe LLP

District Court orders auto loan servicing company to pay $42M to CFPB

On November 26, the U.S. District Court for the Northern District of Georgia granted the CFPB’s motion for default judgment against the defendant, an auto loan servicing company, determining that the defendant’s bankruptcy...more

Skadden, Arps, Slate, Meagher & Flom LLP

UK Proposes New Approach To Regulate ‘Buy Now, Pay Later’ Market Amid Rising Consumer Debt Concerns

In the UK, 14 million people used “buy now, pay later” (BNPL) at least once in the six months leading up to January 2023. Frequent users were more than four times as likely as other consumers to have missed a payment on a...more

Hogan Lovells

Buy-Now Pay-Later reform: UK government publishes updated proposals – now over to the FCA

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HM Treasury has published its long-awaited response to the February 2023 consultation on its proposed approach to bringing Buy-Now Pay-Later (BNPL) within the FCA’s regulatory perimeter. The government is clear that “swift...more

Ballard Spahr LLP

Case in which CFPB came to financial institutions’ defense dismissed

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An Illinois federal judge has dismissed a proposed class action lawsuit that alleged that two Midwestern banks failed to provide repayment disclosures to borrowers, in a case that was unique because the CFPB came to the...more

Orrick, Herrington & Sutcliffe LLP

CFPB publishes BNPL FAQs

On September 18, the CFPB issued Frequently Asked Questions (FAQ) guidance on Buy Now, Pay Later (BNPL) products. The FAQs are organized into three sections: (i) a general description of BNPL products and “Pay-in-Four” BNPL...more

Orrick, Herrington & Sutcliffe LLP

CFPB to ban servicer from federal student loan servicing and pay $120M

On November 12, the CFPB filed a proposed stipulated final judgment and order against a student loan servicer (the defendant) for alleged violations of the CFPA, the FCRA and the FDCPA. As previously covered by InfoBytes, the...more

Ballard Spahr LLP

CFPB’s Frotman: Companies are using technology to squeeze more out of those who can least afford it

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Innovation and technology are not the magic wands that will help low-income Americans climb out of debt; they often are tools used to prey on the neediest people, Seth Frotman, the CFPB’s general counsel told the Poverty Law...more

Cadwalader, Wickersham & Taft LLP

Fool Me Once, Shame on You; Fool Me Twice, Shame on Me: Res Judicata and Ownership Claims Post Foreclosure

The Supreme Court of the State of New York, County of Westchester, recently held that the doctrine of res judicata bars a lender’s claim that a borrower’s subsequent transfers of property are void, if the claim is brought...more

Orrick, Herrington & Sutcliffe LLP

CFPB offers additional guidance for BNPL lenders during compliance transition

On August 16, the CFPB published a blog post on the CFPB’s approach to working collaboratively with the buy now pay later (BNPL) industry to develop an effective regulatory approach to BNPL loans. The blog post stated the...more

Cadwalader, Wickersham & Taft LLP

CFPB Updates on Buy Now, Pay Later Lending

On August 16th, the Consumer Financial Protection Bureau ("CFPB") Director, Rohit Chopra, published a blog post entitled “What Buy Now, Pay Later lenders are doing to be upfront with borrowers” that follows up on its proposed...more

Ballard Spahr LLP

CFPB files and prosecutes yet another enforcement lawsuit using funds obtained in violation of the CFPB’s enabling statute...

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The Introduction to the Complaint which was filed by the CFPB on May 17, 2024 against Solo Funding, Inc. in the United States District Court for the Central District of California – Western Division Los Angeles (Judge R. Gary...more

Ballard Spahr LLP

FirstCash Files Motion for Partial Summary Judgment in Case Filed by CFPB

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FirstCash, a national pawnshop chain, is asking a federal judge to confirm that it has a statutory defense to all of the CFPB’s claims that it violated the Military Lending Act (MLA) while also asking the judge to drop three...more

Bennett Jones LLP

Canadian Government (Finally) Provides Certainty on Criminal Interest Rates

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As we have reported in prior blogs, the Government of Canada is moving forward with plans to lower the criminal interest rate to an annual percentage rate (APR) of 35 percent (the current criminal interest rate, being an...more

Orrick, Herrington & Sutcliffe LLP

Florida amends terms for consumer finance loans

Recently, the Governor of Florida signed into law H1347 (the “Act”) which revises current exceptions to the state’s prohibition on usurious contracts for consumer finance loans of $25,000 or less where a lender charges an...more

Troutman Pepper

CFPB Proposes New “Streamlined” Mortgage Servicing Rules

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As we predicted here, the Consumer Financial Protection Bureau (CFPB or Bureau) last week proposed new and, in some cases, streamlined rules governing what mortgage servicers must do after a borrower becomes delinquent. The...more

Orrick, Herrington & Sutcliffe LLP

Chopra testifies at House, Senate committee hearings

On June 12, the Senate Committee on Banking, Housing, and Urban Affairs held a hearing to address the CFPB’s Semi-Annual Report to Congress. The CFPB Director, Rohit Chopra, in his opening statement addressed the Committee to...more

Sheppard Mullin Richter & Hampton LLP

CFPB Takes Action Against Owners of Small Dollar Lender for Hiding Money to Avoid Penalties

On June 17, the Consumer Financial Protection Bureau filed an order to resolve its 2023 lawsuit against the former CEO of a short-term small dollar lender and his spouse, in connection with a series of fraudulent transfers...more

Sheppard Mullin Richter & Hampton LLP

CFPB Sues Fintech for Deceptive Practices Surrounding Tipping Service

On May 17, the CFPB filed a lawsuit against a California-based fintech that operates a nationwide website and mobile-application based peer-to-peer lending platform through which consumers can obtain small-dollar, short-term...more

Baker Donelson

Florida Court Reverses Desbrunes Decision Based on Homestead Status

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Florida's Fourth District Court of Appeal issued on May 8, 2024, its much-anticipated new opinion on the lender's motion for rehearing in Ronald Desbrunes v. U.S. Bank National Association, as Trustee, which affirms the final...more

Troutman Pepper

Troutman Pepper Weekly Consumer Financial Services Newsletter - May 2024

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To keep you informed of recent activities, below are several of the most significant federal and state events that have influenced the Consumer Financial Services industry over the past week...more

Cadwalader, Wickersham & Taft LLP

These Are Junk Fees

In the Consumer Financial Protection Bureau’s (“CFPB’s”) most recent Supervisory Highlights, published on April 24th, the agency identified a wide variety of fees that were improperly charged to mortgage borrowers. As...more

Goodwin

Traps for the Unwary: Using Alternative Credit Data to Expand Credit Access to LMI Individuals and Underrepresented Communities

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Traditional credit underwriting methods, which are generally based on credit reports, have not always successfully captured the full picture of a borrower’s ability to repay. It is estimated that more than 45 million US...more

Troutman Pepper

CFPB Reports on Student Borrowers’ Experiences During Return to Loan Repayment

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As federal student loan repayments resume after a three-year pause due to the COVID-19 pandemic, the Consumer Financial Protection Bureau (CFPB) published an Issue Spotlight on student borrowers’ experiences, using consumer...more

K&L Gates LLP

Unprecedented Maine Supreme Court Reversal - A Huge Win for Maine Mortgage Lenders

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Not often do courts explicitly reverse their own precedent, especially when that precedent was a unanimous 7-0 opinion issued only a few years earlier. But that is precisely what happened last week when the Supreme Judicial...more

Ballard Spahr LLP

FTC Complaint Alleges Deception and Discrimination in Fintech’s Subscription Cash Advance Offerings

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On January 2, the Federal Trade Commission (FTC) filed a complaint against FloatMe Corp. (“FloatMe”), a fintech that offers short-term cash advances through its mobile app, alleging violations of the FTC Act, the Restore...more

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