Defunded, shuttered, unplugged, deleted. Whatever stage of deactivation describes the Consumer Financial Protection Bureau (CFPB) for the foreseeable future, Russel Vought got his way.

Plug in: Project 2025 specifically calls for the dismantling of the CFPB. Vought authored the chapter on executive powers. While on the campaign trail, President Trump repeatedly denied knowledge of that manual for dismembering the federal government. He lied. The first move in a series of moves aimed at kenneling America’s consumer financial watchdog was a lie.

In what looks to be a short stint as Acting Director of the CFPB, Trump’s newly appointed head of the White House Office of Management and Budget (OMB), Russel Vought, activated the initial stage of one of the end-game scenarios Project 2025 imagines: deactivation of that financial law enforcement agency.

After more than 100 employees were fired this past week, a Thursday court filing on behalf of unions representing CFPB employees said Vought is planning to terminate 95% of the Bureau’s employees by the weekend in the guise of government streamlining. “That would make it impossible for the Bureau to fulfill any of its statutorily required functions,” the filing read. 

Late Friday a federal judge in Washington D.C. ruled quickly to issue a consent order blocking the agency from firing employees for reasons unrelated to work performance or conduct. The consent order also prohibits the agency from diverting funds away from the agency. The consent order says not to “delete, destroy, remove or impair any data,” a move that could serve the efforts of Trump, Vought, and DOGE to undocument the agency altogether.

The Project 2025 plan to annihilate the CFPB has proven to be exactly Trump’s plan — with no parallel plan to ensure smooth market functioning during the regulatory prolapse induced by Trump to curry favor with extremists and financial elites. The business question that radical constitutionalism begs of the mortgage industry is: what if it includes ignoring consent orders?

Annihilating the CFPB should be unthinkable.

This past Tuesday, Feb. 11, Vought cancelled $100 million of contracts with companies that enable the CFPB to perform core functions, from processing consumer complaints to litigation, supervision, and enforcement. On Wednesday, Feb. 12, Vought cut off the CFPB’s statutorily mandated consumer complaint channel, severing a vital connection with the consumers who submit hundreds of thousands of complaints through that channel on a monthly basis. Vought has reportedly informed the General Services Administration (GSA) of the intent to terminate the CFPB’s lease on its D.C. headquarters.

Russel Vought is a Christian nationalist and “radical constitutionalist” who has confused the Christly principle of turning the other cheek with corporate America’s itch to look the other way. The maximalist negotiating position that Trump and Vought have established — burn it down, tally the cost to build back — only benefits consumers if taxpayers are holding the hammers and nails. It’s tech-billionaires funding the dismantling of a CFPB that as far as the manual spells out should never have been created.

Does Trump’s lie — that Project 2025 was not the blueprint for his second-term strategy — matter to the mortgage industry? Is the mortgage industry prepared to effectively and ethically operate on the lawless regulatory frontier that radical constitutionalism proposes? Most critics’ loudest complaints about the CFPB are process-related. They accept a consumer-first regulator making rules and policing compliance with those rules, but have questioned the tactics and enforcement overreach in recent years.

“I have to imagine they’re not just going to say there’s going to be no supervision,” says Daniella Casseres, partner and head of the Mortgage Regulatory Practice Group at Mitchell Sandler. “Do you expect to pass those responsibilities onto another agency that already exists? How do you expect that to play out for independent mortgage companies especially?” 

Project 2025’s sanguine origin story of the CFPB dismisses the mission of the agency to bring consumers to the prudential regulatory table in a meaningful way: “Passage of Title X of Dodd–Frank was a bid to placate concern over a series of regulatory failures identified in the wake of the 2008 financial crisis. The law imported a new superstructure of federal regulation over consumer finance and mortgage lending and servicing industries traditionally regulated by state banking regulators,” the document reads.

A more fundamental question: Does the broader U.S. banking system qualify for the HELOC it wants to draw on hard-won gains in consumer trust post-2008? Where’s the waterfall?

Conversations with a dozen or so mortgage regulatory experts have revealed that no one knows for certain how that future unfolds. Broad assumptions have been made in every pocket of the business community. Whatever that future entails begins with the removal of a regulator whose top priority is protecting the financial rights of taxpaying American consumers.

If government is to be thought of as a business — that’s the deal. In this exchange, consumer protections for … what?

“Does shutting down the CFPB mean their rules no longer apply or simply they are not around going forward?” asks Seth Sprague, director of mortgage banking consulting services at the accounting and professional services advisory, Richey May. “Big, big difference, but risks exist either way.”

If the trajectory of the industry is toward better processes and products, giddy approval from the American banking community at the idea of debanking the CFPB should also be a signal carefully heeded. Holding the mission of the CFPB hostage may prove a simpler way to deactivate the CFPB than waging a war in Congress. Do nothing. Run out of money. Force an institutional brain-drain.

Everything touches America’s housing market, the largest, most accessible liquid asset class for investors in the world. It’s a toehold in the global economy’s Hierarchy of Needs. No regulatory transition plan emerges to instill certainty in the post-CFPB reality.

“There are still certain obligations that they have under federal law, so I’m not sure that they can completely deactivate it, even from the inside,” says Jonathan Kolodziej, Banking & Financial services partner at Bradley Arant Boult Cummings (BABC). He co-leads the firm’s CFPB team, his involvement on which goes back a decade. “They certainly can claw back and they’re absolutely doing that. They’re clawing back on the day-to-day activities and all of that, from a funding perspective as well.”

Plan or not, those men hold the fate of the global economy in their hands — and should know that the deadline for Home Mortgage Disclosure Act (HMDA) reporting to the CFPB is March 1. Losing HMDA would profoundly rattle the mortgage finance industry. The tremors felt now may only be the early impact of Project 2025’s radical constitutionalism on the housing market. Prepare for earthquakes.

The philosophy Vought espouses says this is exactly how Project 2025 is supposed to happen. “Congress should abolish the CFPB and reverse Dodd–Frank Section 1061, thus returning the consumer protection function of the CFPB to banking regulators and the Federal Trade Commission,” it reads. The lie that began that process means Trump and Vought have dared people to think they lack the will to attempt it.

In pre-confirmation questioning before the Senate Banking Committee on Jan. 15, five days before inauguration, then-nominee to lead the OMB, Russel Vought, laid out the strategy to Okla.’s representative on the panel, Republican James Lankford, who asked about Vought’s boss’s feelings on “retrospective review,” by which the regulatory field is weeded over time. They’re gardening.

“We’re back in nerdy territory,” Lankford chuckled. “The president’s given us a new goal,” Vought explained. “He originally had a two-for-one goal in the first term. He’s now given us a 10-for-one goal. We believe that we can hit that, but it’s going to require looking at everything that doesn’t make sense within government and reassessing.” “I can’t even begin to tell you how many Oklahomans would tell me, ‘I just want the government to make sense,’ ” Lankford responded. 

A quota system for regulatory review acts like a tariff on regulatory bodies that need to be dynamic to be effective. For the mortgage industry, ten regulations cut for every one added — a five-fold increase from Trump’s first term — would be punitively more painful than productive.

Unplugging the CFPB begs the question of the Project 2025 industrialists: What’s the plan? The mortgage industry is full of good actors, but earning an easier buck is the reward for every bad actor in history. Hence, police. Greed and corruption and lax oversight caused the Global Financial Crisis. Claiming another crisis on par with 2008 could not happen is irresponsible; helping bring another about is criminal.

Chaos Plunders Certainty In Mortgages

“Who’s going to make sure that we don’t have another huge financial crisis?” asks Lucy Morris, chair of the Government Investigations, Examinations, and Enforcement Practice at Hudson Cook. “It’s not the prudentials because they don’t have any jurisdiction over non-banks. The FTC is a small agency with limited tools. The state AGs are a mixed bag, but they also have limited tools and limited staff.” 

Morris was one in the first group of ten founding members chosen to implement Title X of the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act — like actually setting up the CFPB from 2010-2011. Morris oversaw investigations and litigation relating to consumer financial products and services from 2011-2014, including credit cards, mortgage origination, and mortgage servicing, as the Deputy Enforcement Director for Litigation.

“It was kind of like a startup, but in the federal government framework, so a lot of challenges but also really interesting and fun,” Morris recalls of being on the ground floor of the CFPB. “There was a really strong sense of mission, basically putting all consumer financial protection under one federal agency with a lot of different tools. We wanted to get it right. We wanted to make sure we were implementing Congress’s intent and doing our best to prevent a financial crisis from occurring again in the future.”

Project 2025, of course, has the exact opposite ambition. Right now, America’s housing market is just too important and too fragile to play with. Deregulation without a transition plan risks breaking the trust of global investors who see a U.S. financial system being destabilized for the sake of destabilization. Project 2025 is a blueprint for destruction, not construction. It’s meant for taking over the government.

The rules framework established in the aftermath of the last mortgage meltdown remains in place for now. In the frenzy to celebrate deactivation of American consumers’ most effective body for holding financial institutions accountable, markets face the risk of assuming that a coherent strategy for reform that enhances consumer protections will follow, bad for an industry trying to stabilize compliance signals.

Trump, Vought, DOGE, and the lie behind dismantling the CFPB send the signal: We don’t care about you. In aggregate, consumers and financial markets would be less safe with the CFPB deactivated. The Executive Branch’s dare is two-fold: that the lie will go unnoticed or the lie will go unreconciled. “I don’t think that any of those agencies are equipped to duplicate or fill the void completely,” Morris adds. 

The void is the center of a pre-Dodd-Frank regulatory Venn Diagram that the CFPB was created to supervise, where others’ overlapping oversight still lacked jurisdiction, clarity, and all too often, muscle. “I think what industry really wants generally is less chaos and more certainty.”

The CFPB has spent the past six months intently focused on putting consumers in control of their personal financial data, proposing a rule in December that would rein in data brokers’ selling of American consumers’ sensitive personal and financial information without consumer consent. A muzzled consumer watchdog delights whoever purchased the muzzle and prefers less oversight on data sharing.

“I think you have the potential to see an increase in bad actors engaging in business practices that are deceptive to the consumer. Have they thought through what the likely impact and repercussions of that are?” asks Amanda Tucker, chief risk and compliance officer with Atlantic Bay Mortgage Group, which is licensed in 16 states. “For a number of our employees, specifically our loan officers, they’re hearing and seeing this news and information and asking, ‘What does this mean? Do we no longer have to comply?’ ”

Questions like that should terrify the world, not just every American consumer and financial institution. What it reveals is a strain of forgetfulness. Fallow regulatory fields are the most pressing concern for Tucker, before even considering the impact on operations, compliance, and higher regulatory costs that pulling the CFPB’s plug could bring. Have egregious unintended consequences been accounted for?

“It is clear that the new administration wants to eliminate the CFPB,” says Paul Hancock, a partner at K&L Gates and civil rights attorney who held senior roles at the Justice Department for two decades. “The current blitz is more extreme than I have ever seen, but I continue to believe that it is too early to predict where it will land. The new folks have taken a lot of actions but they also are being challenged in court.”

Preparing for a world without the CFPB is likely what the wealthiest, shrewdest, and most sophisticated business leaders across the world have teams working diligently right now to understand — if that’s what the tech-billionaires want. Cancel the notion that CFPB deletion is far-fetched. ‘The unthinkable never happens until it does’ drives the deregulatory intent of Trump’s administration, as far as anyone can tell.

On Tuesday, February 11, Trump nominated regulatory veteran Jonathan McKernan to hold the permanent office of CFPB Director, replacing Acting Director Vought. McKernan looks like a regulatory olive branch. The Consumer Financial Services Law Monitor calls him an “an ally of the financial services industry.” His housing chops include senior counsel for policy at the Federal Housing Finance Agency (FHFA) from Oct. 2019 to Jan. 2021, overlapping with the arrival of the COVID-19 pandemic.

“There are enough lawyers like me that are going to be counseling their clients that we can’t just look at the present environment, that we do have to be mindful of four years from now, or eight years,” Kolodziej explains. “I do think the way people conduct their business will change,” he’s learned talking to clients. “Some areas of opportunity that there’s just been this feeling of overwhelming, kind of stifling oversight.”

Olive branch or not, the CFPB’s enforcement director, Eric Halperin, and supervision director, Lorelei Salas, simultaneously announced their resignations on February 11. The first post-Chopra Acting Director, Trump-appointed Treasury Secretary Scott Bessent, was designated to the role on January 31. Vought replaced Bessent two days later, and continued tightening the collar on the watchdog’s examinations, investigations, supervision, rule making, and enforcement actions.

What the mortgage industry craves more than anything is avoiding more volatility. More certainty, not the uncertainty of heavy action. What about the uncertainty of no action?

“The rollercoaster that seems right now inevitable, of heavy regulation and heavy oversight by the bureau, and then down to nothing, and then up and down, and up and down, is just unsustainable,” Kolodziej hears when speaking with clients across the industry. From an enforcement perspective, “that weight has now sort of been lifted, and maybe now people are willing to kind of think about projects or areas where they’ve been hesitant to venture.”

In the CFPB’s legal and operational meantime, Vought has argued that the CFPB, with over $700 million on hand, has no pressing need to have its funding unfrozen. The Department of Government Efficiency (DOGE) has also been poking through the CFPB’s highly confidential systems. Elon Musk says the $700 million should be returned to taxpayers.

“If no one’s even looking, it’s easier to take more risk in your business lending practices,” says Bob Niemi, director of government affairs at Weiner Brodsky Kider, chair of the American Association of Residential Mortgage Regulators (AARMR), former ombudsman for the Nationwide Mortgage Licensing System (NMLS), and former deputy superintendent for the Ohio Division of Financial Institutions.

The housing market functions as a national savings account and cash flows for the Federal Reserve. Jerome Powell has acknowledged that policymakers are modelling how certain Executive Branch-driven policy shifts would impact the data — the market — that rate-makers use to steer monetary policy. To that end, the committee is “very much in the mode of waiting to see what policies will be enacted,” Powell told reporters after announcing the decision to pause on further rate cuts last month.

“Those risks don’t just impact the company,” Niemi continues. “They will impact consumers as well. No one should want to get to a place where consumers are being harmed and we experience the true unintended consequences that will have lasting impacts on families and communities in the future.”

The U.S. mortgage meltdown and housing crisis that precipitated the Global Financial Crisis crippled economies and societies around the world. The fortunes of people and companies who had invested in the U.S.’s economic greatness, always confused for exceptionalism, were lost to the greed and complacency of America’s bankers.

Millions of lost homes and jobs impacted the lifetime earnings potential of millions of consumers who were children then, and would like to be buying first homes now.

Chaos For State Banking Regulators

“We can’t regulate the existence of bad actors. We could try, but there’s some companies that are run unethically and there's companies that are run ethically,” says Courtney Thompson, head of servicing at the nationally licensed CMG Financial, a top-20 independent mortgage bank (IMB) in 2023, possibly making the top-10 in 2024, pending HMDA reporting. “What we have now that we didn’t have then, regardless of the existence of the CFPB, is a rules framework that we can measure against.”

In the aftermath of the mortgage crisis, Thompson was directly involved with the Office of the Comptroller of the Currency (OCC) and the Federal Reserve Board (FRB)’s Independent Foreclosure Review (IFR). This effort became a referendum on the future of mortgage regulation as enforced by the CFPB. The 15th-largest bank with mortgage servicing at the time, and thus not subject to review, was Flagstar Bank. 

Thompson joined in 2014 as senior vice president of servicing in the aftermath of the bank’s historic citation from the CFPB — the first ever enforcement action for violating post-crisis loss mitigation mortgage servicing rules — a framework that Thompson helped assemble through her work with the IFR.

It was Lucy Morris's investigation into Flagstar, conducted by Morris's litigation team and on her watch, which resulted in that historic, first-ever enforcement action. The case and $37.5 million fine were not settled and announced until after Morris left the CFPB in 2014.

“What do we have more time to do during this time period while we maintain the compliant operations that we’ve already built under the guise of the fear of enforcement from the CFPB?” Thompson asks. “The two primary questions are: will financial institutions still follow the rules absent CFPB enforcement, and is the current administration actually going to dismantle the rules framework that exists today?”

LinkedIn buzzes like flypaper as mortgage professionals celebrate the downfall of an agency that watches their back, too. Greed crippled a generation’s pursuit of the American Dream. Greed drives bad leadership. Trump, Vought, and the Project 2025 reformers are hell bent on destabilization. The mortgage industry is process-oriented. Bad processes tend to keep producing bad outcomes.

“We get a lot of this kind of bluster out there of, ‘The CFPB is being shuttered.’ I’m not sure that’s actually the case,” BABC’s Kolodziej explains. “I think maybe we have both sides kind of posturing a little bit, at least that’s my impression right now.”

“All of this badly hurts the financial services industry, which would benefit from even-handed, fair, and reasonable enforcement. But, that is not the world in which we live,” K&L Gates’ Hancock adds. “Overall, of course, the possible elimination of the CFPB is a huge issue.”

Bashing the CFPB is self-defeating as its mission is pretty popular among the consumers it protects. As the chief federal regulator of independent mortgage banks (IMBs), the CFPB exists because of what happened when it didn’t, and the first mortgage professionals who say “2008 could never happen again” risk being the first who forgot how it did. They underestimate how easy it would be without an active and dynamic CFPB, especially if the rules framework becomes an intersection of blinking yellows, not reds.

Talk about flooding the zone.

“Unfortunately, I think certain independent mortgage lenders are going to essentially go back to the way they were governed before the crisis as they are going to have the potential to make more money,” says Mitchell Sandler’s Casseres. Multiple years of nominal profits for many individuals and lenders may encourage some percentage of those inclined to cut corners to do so if asked to self-regulate. “In this environment, I have to believe some actors would take those business opportunities,” she says.

Like Boar’s Head at the deli after the Jarratt plant investigation, mortgages risk a perception regression in the absence of a prudential consumer watchdog. As the families of the ten dead from that listeria outbreak can attest — stuff happens even with strong oversight. Advocates of a deactivated CFPB say consumers should accept responsibility for self-education. A consumer trust problem does not serve the industry’s interests after working so diligently to earn that trust back.

“I believe strongly that if this continues for a period of time with the CFPB, we will see the cost to comply and the burden substantially increase,” says Tucker, who has seen no attention paid to what the deactivation of the CFPB thus far entails for state regulators. “Definitions are different state by state, the thresholds are different state by state. As a lender you’re going to comply conceivably with 17 different state laws on a state-by-state basis, and I think that in and of itself is going to increase cost.”

Trump and DOGE froze future CFPB funding, but the conservative Supreme Court upheld the constitutionality of the CFPB’s funding structure in a 7-2 ruling last May. Its constitutional right to exist, funding-wise, appears sound. Mortgage professionals recognize that a borrower’s trust and prior knowledge is never assumed — that trust is earned through education.

As the CFPB receives the same treatment as the USAID, it’s the human- and consumer-oriented mission of the agency being held hostage.

The deactivation of the CFPB psychologically sends consumers back to the Great Recession, chipping at the bedrock of their overall trust in financial markets. Many of those consumers are struggling as it is. Plus, consumers can’t learn everything about everything. That reality is unreality in a world where everyone blindly presses “I agree” to all terms and services.

“We believe that it’s highly unlikely that we would see some of the legislation and congressional steps to effectively unwind the CFPB,” Tucker continues. The former regulator with the Massachusetts Division of Banking from 2004-2007 has led Atlantic Bay’s compliance strategy since 2018. She says the recent actions at the CFPB feel different than those taken in Trump’s first term. “I don’t know that a world without the CFPB is a world we want to live in, but I certainly think the next four years will be challenging.”

“States will be standing up and being more aware and taking on the burden,” Niemi continues, having watched the unplugging of the CFPB occur while attending an NMLS conference in Atlanta. He says states are beginning to map strategies for a post-CFPB world, focusing on “the areas that will go unattended, unreviewed, unexamined,” he says. “There needs to be a message today from the leaders of lending organizations all the way down to the front lines: ‘We understand this is happening. Our rules and polices have not changed.’”

Inviting Another Financial Crisis

The Federal Deposit Insurance Corporation (FDIC), Office of the Comptroller of the Currency (OCC), and Federal Trade Commission (FTC) would insufficiently and inefficiently fill the regulatory void that an unplugged CFPB creates, even with cooperative state attorneys general (AGs) and state regulators. That violates DOGE’s core tenet. The CFPB is unique by design, not only in its enforcement function but its jurisdiction to examine bank and non-bank actors and provide a nationwide supervisory function.

Hudson Cook’s Lucy Morris worked at the Federal Trade Commission (FTC) for two decades before joining the CFPB, including as Assistant Director for Financial Practices and Assistant to the Director of the FTC’s Bureau of Consumer Protection — the actual, financial-crime fighting unit. Oversight provides certainty and certainty reduces volatility, which adds certainty. Eliminating oversight adds uncertainty.

“The CFPB has overreached in recent years, and there’s opportunity for reform, but it shouldn’t go away. The financial marketplace is more complicated than ever, and there needs to be an agency like the CFPB,” she explains, citing the growing role of under-regulated non-bank financial institutions which the Financial Stability Oversight Council (FSOC), also a Dodd-Frank incarnation, has warned about.

The consequences of not dealing with an active and dynamic CFPB could be costlier than whatever regulatory expenses lenders imagine they’ll save, underscoring the mortgage industry’s long-term lack of long-term regulatory consistency. Standardization promotes scale. Deactivating the CFPB does not magically erase the rules and regulations the agency enforces, and could shift a tremendous amount of regulatory work to already overburdened and under-equipped federal and state regulators.

“There’s always a possibility that in four years, there’s a new administration and the CFPB starts up its enforcement apparatus again,” says Morris. “I wouldn’t be comfortable just kind of deciding, ‘I don’t need to follow the law or the regulations.’ I think it’s the right thing to do, to follow the law for your customers, and it’s the right thing to do to minimize your risk.” It’s called financial law enforcement for a reason.

But, money has always gotten in the way of the right thing to do. Cancelling the CFPB overnight is a bad process unfolding, yielding a bad outcome. Removing critical financial oversight makes U.S. debt look riskier and policymakers’ approach to economic affairs look unserious. The housing industry and Wall Street tried complacency in the early 2000s, and fifteen years ago it blew up in the world’s face.

“How aggressive will some originators get? How aggressive will the aggregators be?” Richey May’s Seth Sprague points out. “If the current CFPB rules such as Reg X go away, I don’t know how the mortgage space would move forward as they balance the future risk of any originations made.”

“There’s a lot of compliance work that goes along with keeping accounting for 50 state laws and regulations,” says Earl Cooper, compliance counsel at Universal Component Lender Services. “There’s going to be a lot of overlap, but you need someone that’s monitoring the changes to the laws,” from alerting companies to changes to working across different lenders’ capacity to comply with changes.

“I think that is arduous,” he continues. “It’s tough,” and even more so for large states that feel the pressure to replace the CFPB on their home turf. States like New York, that set a lofty regulatory standard other states’ regulators may strive to meet. “There’s going to be some states that are very arduous, and there will be some states where your compliance regulations are eased, but overall, I think it’s going to be an increase in compliance regulatory efforts.”

Much of the reason the U.S. gets to economically and politically bully the global community is because of its mission-critical housing market. Yet, that market faces systemic challenges that will take decades to address at the current pace while rapid advancements in technology accelerate consolidation. Housing’s approach to climate change is pathologically flawed. Global pandemic lockdowns in late 2019 crushed economies again. Now by some miracle the U.S. economy remains the envy of the world.

“I don’t think the balance of power in the way our federal government is set up is that any one entity should have that much power or that they have that power to do it,” Niemi adds. “They can certainly defang it, defund it, limit its impact, but what’s the true benefit of all those actions?” The manufacturing quality of residential mortgages has improved astoundingly in the post-crisis era. Why risk it?

“No one gets a free pass on the financial crisis,” he continues. “Everybody followed a system that allowed and rewarded abundance, not compliance, and that’s where we are today.” The improved processes that emerged from that reckoning have allowed for the manufacture of a mortgage product that is “a better product than we’ve ever had,” he continues. “It’s more valuable. It’s more sustainable. It’s more tradable.”

Many mortgage professionals agree that the mortgage industry and Wall Street being 15 years removed from the mortgage crisis does not negate the need for the CFPB. They agree, it’s too soon to be digging up the roots of the world’s most critical economy — and consumer — again.

“Nobody wants it to happen,” says Morris, “and you hope that the market forces ensure that there won’t be a financial crisis like we had, but that’s probably overly optimistic.” She says there’s nothing overstated in last week’s warning from Biden-era CFPB Director Rohit Chopra that eliminating a focus on consumer protections from the prudential regulatory framework is “just inviting another financial crisis.”

The mortgage industry has grown to rely on the CFPB’s interpretations of federal laws and regulations for investment, personnel, and strategy decisions. Small lenders are already undersupervised when it comes to systemic risks like cyber attacks and escalating climate change, but having a prudential consumer watchdog helps to maintain an industry standard.

All that European partners have asked the U.S. to do since that self-inflicted calamity was keep its eye on the ball. Those European economies have not enjoyed the post-pandemic revival that America’s has while facing similar political upheaval and rising climate costs. Trans-Atlantic banking disparities that have been widening for a decade stand to continue widening as Europeans accuse the U.S. of stuffing the till with broad deregulation.

“What occurs over the next four years that effectively changes the purview, scope, and focus of the CFPB?” asks Tucker. “More so, what happens during this period of confusion and chaos? How long after this period of confusion and chaos are we as an industry seeing the impact? I think, unfortunately, the longer the confusion and chaos goes on, the longer we’ll feel the impact.”

The U.S. exited Basel III commitments last year, for which Trump’s nominee for permanent CFPB Director Jonathan McKernan strongly advocated, as did much of the U.S. banking system. The prudential financial regulator whose top priority is the American consumer that constitutes 70% of the U.S. GDP faces permanent deactivation — one way or another.

“It’s important to have a regulator who’s making sure that mortgages are provided in a fair and responsible way,” Morris adds. “It’s too important to not have an agency like the CFPB in place. It’s too important to consumers and it’s too important to our economy to make sure it’s functioning appropriately.”

Unplugging the CFPB isn’t just a Trump administration priority — it’s a reckless gamble with America’s financial stability. The agency exists because of what happened in 2008, and stripping its power doesn’t erase the need for oversight; it just invites chaos, risk, and a return to the conditions that fueled the last financial crisis. 

The mortgage industry is built on a foundation of trust, and that trust requires regulation and oversight. Without an organization like the CFPB, unethical operators will exploit the gaps, markets will destabilize, and consumers — who are responsible for 70% of the US economy — will collectively become riskier collateral. The lie's been told. The question isn’t whether another crisis is possible.