Consumer Financial Protection Bureau: Great Idea, Our North Carolina Foreclosure Defense Attorney says…

October 21, 2011

Our North Carolina foreclosure defense attorney law firm remains hopeful, but skeptical. The truth is that other government watchdogs, including the Food & Drug Administration and the Securities and Exchange Commission, have fallen short time and time again when it comes to adequately protecting consumers.

Nowhere has the need for consumer protections become more glaring that in the housing market. Those fighting foreclosure in North Carolina have legal rights. Whether you are considering a short sale, loan modification, strategic default, or defending a pending foreclosure, you can typically stay in your home for months while an experienced North Carolina forelcosure defense attorney fights for the best possible outcome in your particular financial situation.

The recent economic collapse highlights the need for better consumer protections from predatory lending and other shady (or downright illegal) tactics on the part of banks. Then again, so did the Enron and WorldCom collapses a decade ago. And the Savings and Loan scandal a decade before that. 

In the last 18 months the tide has turned. While the consumer may still not be in a position of strength when it comes to negotiating with banks, the playing field has at least leveled as news of robo-signed documents, fraud and other unethical and illegal behavior on the part of banks has prompted criminal investigations in all 50 states.

Earlier this month, President Obama slammed bank fees – saying large financial institutions were using new financial rules as an excuse to impose fees on consumers, the Charlotte Observer reported. Obama took the moment to urge Congress to confirm Richard Cordray as head of the new agency. Republicans have vowed to block the nomination.  The objections offered have used the rhetoric of “too much regulation” and “too much government interference”.  However, it was precisely the lack of these two things that was the major cause of the economic downturn.

The New York Times reports the new Wall Street watchdog is set to unveil a string of new regulations. A new rule will be completed early next year that will require lenders to gauge whether homeowners are capable of repaying mortgages. If you think something like that shouldn’t need regulating, you’re right. Yet the economic collapse was fueled by bankers padding their bonuses by approving loans and passing the buck, literally by selling the failed loans back to other investors in the form of “mortgage-backed securities”.

The Consumer Financial Protection Bureau was created last year through the Dodd-Frank regulatory reform, which was passed by Congress in a largely bi-partisan manner in the wake of the economic collapse.

Other plans include revamping and standardizing mortgage disclosure forms, which have long been needlessly confusing, and the regulation of payday lenders, mortgage firms and other fringe financial institutions. The bureau is an independent agency within the Federal Reserve that has taken over the duties of several unconnected government agencies.  Congressional Republicans are already calling for an overhaul of the bureau’s authority.

Regardless of what agency is enacting and enforcing consumer rights, it is often incumbent upon a consumer to invoke those rights. Whether the CFPB grows into a powerful force of consumer protection, or becomes just another bloated federal bureaucracy, those dealing with consumer rights issues in North Carolina will always be best served by consulting an experienced law firm.

The North Carolina foreclosure defense attorneys at Soboleski Law, P.C. can be reached at 828-285-8888.

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