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Is the CFPB Coming for Mortgage Lenders?
Since 1975, lenders have been required by the Home Mortgage Disclosure Act (HMDA) to collect loan data, including borrower ethnicity. In 2011, the CFPB took over HMDA enforcement, and now they’re investigating whether lenders are price gouging—specifically, if minority borrowers are being charged more.
In 2023, over half of borrowers paid discount points, a 13% increase from 2022. Loan costs rose across the board, but the hikes were higher for Black and Hispanic borrowers. Meanwhile, independent mortgage companies originated most loans, making them the CFPB’s primary target.
But here’s the contradiction: The government itself mandates Loan-Level Price Adjustments (LLPAs), which lead to higher costs for certain borrowers. So, if the CFPB wants fairness, shouldn’t they start by fixing their own policies?
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