Skip to main content
Menu Icon
Close

InfoBytes Blog

Financial Services Law Insights and Observations

Filter

Subscribe to our InfoBytes Blog weekly newsletter and other publications for news affecting the financial services industry.

  • Chopra, Hsu encourage use of special purpose credit programs

    Federal Issues

    On December 6, CFPB Director Rohit Chopra released a statement regarding HUD’s guidance, also issued that day, clarifying that special purpose credit programs that conform with ECOA and its implementing regulation, Regulation B, generally do not violate the Federal Housing Act. According to HUD’s memorandum, the two statutes are complementary and “intended to harmoniously coexist.” As previously covered by InfoBytes, in December 2020, the CFPB issued an advisory opinion addressing Regulation B as it applies to certain aspects of special purpose credit programs. In his statement, Chopra encouraged creditors “to explore the opportunities available through special purpose credit programs,” which “provide targeted means by which creditors can better serve communities who have been historically shut out or otherwise disadvantaged.”

    Acting Comptroller of the Currency Michael Hsu also issued a statement encouraging banks and federal savings associations to “explore the opportunities available through special purpose credit programs.” Taking advantage of the special purpose credit program provisions of ECOA and Regulation B “can be a significant step in addressing the racial and ethnic homeownership and wealth gaps that persist in the United States,” Hsu stated.

    Federal Issues HUD CFPB OCC Bank Regulatory Regulation B ECOA Fair Housing Act SPCP Consumer Finance

  • Uejio says SPCPs may help economically disadvantaged homeowners

    Federal Issues

    On September 1, CFPB acting Director Dave Uejio spoke before the National Fair Housing Alliance’s forum on special purpose credit programs (SPCPs) to address discrimination and inequity trends in homeownership and explore ways that SPCPs could be used to promote fair and equitable access to credit and mortgage markets. Uejio discussed a Bureau report detailing the “enormous toll” that the Covid-19 pandemic has had on minority homeowners and cautioned that Black and Hispanic homeowners will be disproportionately represented in foreclosure data once pandemic housing protections end. To address these issues, Uejio referred to a Bureau advisory opinion issued last December, which provided creditors additional guidance for complying with ECOA to ensure the development of compliant SPCPs. (Covered by InfoBytes here.) While ECOA and Regulation B prohibit discrimination on a prohibited basis in any aspect of a credit transaction, SPCP provisions under the statute and regulation provide specific means to allow creditors meet special social needs and benefit economically-disadvantaged groups. “The SPCP provision in ECOA is also a recognition that government alone cannot solve this problem,” Uejio stated. “All of us—regulators, policymakers, nonprofits, advocates, and mortgage lenders—must work together.”

    Federal Issues CFPB ECOA Regulation B Covid-19 Discrimination SPCP

Upcoming Events