CFPB Issues No-Action Letter to Bank of America for Housing Counseling Services

The Consumer Financial Protection Bureau (CFPB) has issued a no-action letter (NAL) to Bank of America regarding the Charlotte, N.C.-based financial institution’s funding arrangements with housing counseling agencies (HCAs) certified by the U.S. Department of Housing & Urban Development (HUD).

 

According to a statement issued by the CFPB, a NAL is designed to “provide increased regulatory certainty through a statement that the Bureau will not bring a supervisory or enforcement action against a company for providing a product or service under certain facts and circumstances.” The CFPB issued a revised NAL policy in September 2019 in order to offer a streamlined review process focusing on the consumer benefits and risks of the product or service in question. Also in September 2019, the CFPB issued its first NAL under the revised policy in response to a request by HUD on behalf of more than 1,600 HCAs that participate in the department’s housing counseling program.

 

The CFPB added that Bank of America successfully applied for a NAL to facilitate funding arrangements with HCAs, which serve more than one million households annually.

 

“They offer pre-purchase homeownership counseling to potential borrowers looking to purchase their first home,” the CFPB said about the HCAs. “With the information, potential borrowers may be better able to make informed choices based on their financial circumstances to achieve safe and sustainable homeownership.”

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