CFPB Director Targets Credit Reporting Fees
Consumer Financial Protection Bureau Targets Credit Reporting Fee
The CFPB is continuing its crusade against so called “junk fees,” and now is looking at crediting reporting fees. In a May 20 speech to the Mortgage Bankers Association, Director Rohit Chopra highlighted the rising costs of obtaining credit reports which he stated affects both lenders and consumer. Chopra criticized FICO’s recent move to a flat fee pricing model for credit scores, stating that it led to a 400% increase in costs for many lenders. He also complained about FICO’s policy of charging the same fee for both soft and hard credit inquiries, despite the fact that there are significant differences in the amount of information provided.
Chopra also noted that costs for consumers are exacerbated as lenders often pull multiple reports from the three major credit reporting agencies for the same transaction, paying multiple times for the same information. According to Chopra, lenders are passing these expenses onto borrowers through higher origination fees and increased interest rates, ultimately raising overall mortgage costs.
Putting It Into Practice: This is the most recent development in the Bureau’s ongoing crusade against “junk fees” (previously discussed here and
Related Knowledge Center: Climate economics
Climate change is now a driver of the world’s economy. The impact is profound:
- Catastrophic weather events — hurricanes, floods, droughts, high temperatures — are more frequent and more extreme. The cost can be measured in both the initial damage caused and the longer-term impact on the economy.
- Vulnerable communities are increasing climate-related investments, hardening infrastructure and taking other protective measures.
- Investment in carbon capture and storage technologies is increasingly rapidly.
- Governments are making investments and crafting regulations to reduce emissions of carbon dioxide and other greenhouse gases.
On top of all of this is the cost of uncertainty. As the Fourth National Climate Assessment, released in 2018 by the U.S. Global Change Research Program, says, “The assumption that current and future climate conditions will resemble the recent past is no longer valid.”