CFPB urges financial businesses to assist Hurricane Harvey victims

The CFPB is encouraging banks and other financial entities to help victims by waiving charges and extending repayment terms

CFPB urges financial businesses to assist Hurricane Harvey victims
The Consumer Financial Protection Bureau (CFPB) urged its supervised entities to help lessen the financial impact of Hurricane Harvey on consumers and contribute to faster recovery by providing flexibility and other assistance, according to a policy guide.

Entities supervised by the CFPB generally include banks, credit unions, and certain companies that provide consumer financial services.

The agency is asking financial institutions to extend services to those impacted by the storm by offering penalty-free forbearance or repayment periods with clearly disclosed terms; limiting or waiving fees and charges, including overdraft fees, ATM fees, or late fees; and restructuring existing debt by, for example, extending repayment terms with clearly disclosed terms.

Other actions entities may do to assist customers include refinancing existing debt or extending new credit with terms favorable to the consumer; easing documentation or credit-extension requirements; increasing capacity for customer service hotlines, particularly those that serve consumers in languages other than English; and increasing ATM daily cash withdrawal limits.

Aside from these actions, the CFPB also urged supervised entities to make use of existing regulatory flexibility if these will benefit consumers. The CFPB gave as examples Regulation B, Regulation X, and Regulation Z.

Regulation B, which implements the Equal Credit Opportunity Act, allows faster access to credit secured by a first lien on a dwelling for consumers affected by a major disaster or emergency. Regulation X, which implements the Real Estate Settlement Procedures Act, allows servicers to offer relief to disaster-affected borrowers without the need for a complete application as these borrowers may face difficulty in obtaining documents. Regulation Z, which implements the Truth in Lending Act, can help ease credit access for borrowers facing a bona fide personal financial emergency following a major disaster or emergency.

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