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Category Archives: Credit Reporting
by Jeff Sovern Former governor, HUD general counsel, and current head of the American Bankers Association Frank Keating has penned an op-ed for the Wall Street Journal (behind paywall) with the headline above. Keating complains that HUD has adopted the disparate impact test for discrimination; that the CFPB's qualified mortgage rule (QM rule) will restrict […]
by Jeff Sovern The Supreme Court today granted cert in Mount Holly v. Mount Holly Gardens Citizens in Action, which raises the issue of whether courts can use the disparate impact test in federal Fair Housing Act (FHA) cases. Because the language of the FHA is similar to that of the Equal Credit Opportunity Act […]
Daniel Schwarcz of Minnesota has written Monitoring, Reporting, and Recalling Defective Financial Products, University of Chicago Legal Forum (2013). Here is the abstract: In recent years, innovations in consumer financial protection have drawn heavily from the law governing the safety of tangible products. This short essay, prepared for a symposium entitled "Frontiers of Consumer Protection," […]
by Jeff Sovern We frequently write here about the Fair Credit Reporting Act because of its application to credit reports. But in fact, the FCRA applies to many non-credit transactions. Those transactions typically take one of two forms. In one form someone uses a credit report for something other than a lending decision. For example, […]
by Jeff Sovern Traditional consumer protection rules drew on law and economics models that assumed that consumers were rational and that when consumer markets functioned poorly, all that needed to be done was give rational consumers the ability to protect themselves. For example, the Truth in Lending Act's focus on disclosures presupposes that rational consumers would […]
by Jeff Sovern Tonight marks the start of the NFL draft, a time when hope blooms for all fans of an NFL team, because they can always suppose that their team has used the draft to get better–and many teams will. Many fans create wish lists–what they want for their teams. In that spirit, I […]
by Jeff Sovern Chris Willis of Ballard Spahr's CFPB Monitor recently blogged about whether disparate impact can properly be termed discrimination and therefore prohibited by ECOA. For those who don't know, courts generally recognize three ways to prove discrimination in violation of ECOA: direct evidence, disparate treatment (except in the Seventh Circuit) and disparate impact, or as […]
by Jeff Sovern Earlier this week, I commented on car dealer opposition to the CFPB's auto financing rules. Chris Willis replied on Ballard Spahr's informative CFPB Monitor Blog. I want to respond to two of Chris's points: first, that compliance, policing, and later enforcement steps will increase the cost of credit; and second, that dealers […]
by Jeff Sovern Here. The piece begins: Auto dealership advocates are warning that costs will rise for borrowers if the Consumer Financial Protection Bureau presses banks to curtail auto loan markups determined by dealers. The warning followed the CFPB's bulletin this week that said banks are responsible for discrimination if their partner dealers mark up […]