BrokerageRegulations

CFPB v. PHH, explained

Why are the mortgage and real estate industries watching this case so closely?

The legal battle between the Consumer Financial Protection Bureau (CFPB) and New Jersey-based mortgage lender PHH Corp., is one of the most watched cases in the mortgage and real estate industries, and for good reason: It involves a huge enforcement penalty -- $109 million -- and it marks the first time a company has fought back against the bureau for taking such an action. The case is complex and has been brewing for two years, but boiled down to the simplest of terms, the case involves the place where mortgage reinsurance, a business practice that traces its roots in the mortgage industry to the 1990s, and the Real Estate Settlement Procedures Act (RESPA) collide. But as the case has progressed over time, it has evolved into something much more fascinating: A critique of how the CFPB goes about enforcing RESPA against companies in the mortgage, real estate and settlement services industries. Here is a timeline of the events in the case, and some explanations of key issues ...