After the 2008 financial crash threw millions of Americans out of their homes, Congress created a new agency—the Consumer Financial Protection Bureau (CFPB)—to protect families from predatory financial firms.
Now President Donald Trump and Elon Musk’s so-called Department of Government Efficiency (DOGE) are “winding down” this agency and planning to fire nearly all of its 1,700 employees.
This is a seriously unwise and misguided thing to do. During its fourteen-year history, the CFPB has won more than $21 billion in compensation for victims of financial fraud and abuse. And its rules to promote access to affordable mortgages have helped countless families hold on to their homes.
One of these people was the client of an attorney in our network at the National Consumer Law Center, where I also work. He and his elderly parents came to the brink of foreclosure, but were able to remain in their family home thanks to the CFPB. To protect his privacy, I’ll keep his identity anonymous.
The son purchased his parents’ home in rural Maine, so they would have a guaranteed place to live out the rest of their lives. He would also reside there and provide care for them. But due to medical problems and subsequent job loss, he lost the income he and his aging parents relied on.
And so the son cut back on everything he could—groceries, heat, hot water, gifts, and going out—but he still fell behind on the mortgage. He was overcome with guilt that he could not make the payments and suffered from depression. His mother also experienced anxiety around losing the home, exacerbating his shame.
When the son asked for mortgage help, his loan company steered him into an impossibly expensive plan instead of the affordable one that the company’s policies required. Under CFPB rules, when families hit a bump in the road, companies are required to work with them to find an affordable solution whenever possible. Instead, this company set the family up for failure.
With an initial payment of 200 percent of the son’s monthly income, and monthly payments greater than his total monthly income after that, the plan was simply infeasible. At first, the family members pooled their resources and tried to maintain the payments, but they were unable to keep this up.
The emotional toll became even heavier after the mother passed away and the son became the primary caregiver for his father, who had dementia.
But then, an attorney in our network worked with the family to enforce the CFPB’s rules for mortgage companies, which require them to review all available options for homeowners facing hardship. A new arrangement was struck that allowed the family to keep its home—an outcome that should have occurred years earlier.
What will happen to families like this one if the CFPB is dismantled?
If the Trump Administration has its way, families will no longer be able to rely on this consumer watchdog for help. Already, the administration has dropped pending lawsuits against a number of financial firms accused of serious wrong-doing.
Vanderbilt Mortgage and Finance, for example, was facing claims that it had ignored red flags and pushed families into unaffordable mobile home loans. When loans became delinquent, they hit some borrowers with additional penalties and fees, resulting in many of them losing their homes. The CFPB sought restitution for these homeowners, as well as financial penalties for the company. Now, since the lawsuit was dropped, Vanderbilt is off the hook.
Without the CFPB, companies will revert to exploiting consumers through predatory payday loans, gouging them with excessive overdraft fees and ruining their credit by reporting medical debt to credit bureaus.
To protect American families from corporate abuse, we need to demand that this consumer champion remains viable, independent, and strong.
This column was produced for Progressive Perspectives, a project of The Progressive magazine, and distributed by Tribune News Service.
