CFPB Issues RFI: Fees Imposed in Res. Mortgage Transactions

The Consumer Financial Protection Bureau (CFPB) recently issued a request for information related to what the CFPB believes to be junk fees that are increasing mortgage closing costs. The CFPB stated that it wants to understand why closing costs are increasing, who is benefiting, and how costs for borrowers and lenders could be lowered.

The CFPB’s request for information seeks input about how mortgage closing costs may be inflated and constraining the mortgage lending market. Specifically, the CFPB asks for information about:

• Which fees are subject to competition: The CFPB is interested in the extent to which consumers or lenders currently apply competitive pressure on third-party closing costs. The CFPB also wants to learn about market barriers that limit competition.
• How fees are set and who profits from them: The CFPB wants to learn about who benefits from required services and whether lenders have oversight or leverage over third-party costs that are passed onto consumers.
• How fees are changing and how they affect consumers: The CFPB wants information about which costs have increased most in recent years and the reasons for such increases, including the rise in cost for credit reports and credit scores. The CFPB is also interested in data on the impact of closing costs on housing affordability, access to homeownership, or home equity.

Comments must be received by August 2, 2024.

The Leagues are currently reviewing this request for information and we will stay vigilant on this matter and keep you updated as it evolves. If you have any questions, contact Lisa Quaranta, Vice President of Regulatory Advocacy.

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