Which of the following activities is a function of the Consumer Financial Protection Bureau (CFPB)?

Which of the following activities is a function of the Consumer Financial Protection Bureau (CFPB)?

A. Regulating the federal funds rate at which money is lent to banks

B. Regulating the number of mortgage loan originators in the mortgage industry

C. Regulating mortgage lenders on their mortgage origination practices and procedures

D. Deciding what quantity of mortgage-backed securities are purchased by the government

View Answer

Answer: C

Explanation:

The Consumer Financial Protection Bureau (CFPB) is responsible for regulating mortgage lenders and overseeing their origination practices and procedures. The CFPB was created under the Dodd-Frank Act to protect consumers from unfair, deceptive, or abusive practices in financial services, including mortgages. Its functions include:

Enforcing rules related to mortgage origination, such as TILA, RESPA, and ECOA.

Ensuring that lenders provide clear disclosures and follow fair lending practices.

Other functions:

Regulating the federal funds rate (A) is the role of the Federal Reserve.

Deciding the quantity of mortgage-backed securities purchased by the government (D) is related to Federal Reserve monetary policy, not the CFPB.

References:

Dodd-Frank Wall Street Reform and Consumer Protection Act

CFPB’s Role in Mortgage Origination