The U.S. Supreme Court recently issued opinions in two consequential cases for the mortgage industry, Consumer Financial Protection Bureau v. Community Financial Services Assn. of America, Ltd and Cantero v. Bank of America. In the CFPB case, the Court held that the funding mechanism for the CFPB is compliant with the appropriations clause and is therefore constitutional. In Cantero, the Court vacated and remanded the decision, opening the case for potential future legal challenge. Following these rulings, Jay Beitel spoke with the media to discuss what these rulings might indicate for the mortgage industry.

On CFPB: “The U.S. consumer financial industry can sleep soundly tonight. Instead of upending 24 years of consumer financing regulations, enactments, and enforcements, today in the case of Consumer Financial Protection Bureau vs. Community Financial Services Assn. Of America, Ltd, the U.S. Supreme Court held that the statutory funding scheme for the Consumer Financial Protection Bureau meets the constitutional mandate under the appropriations clause. So, the business of consumer financing can continue to function with the systems and procedures in place.”

On Cantero: “This case demonstrates that not all U.S. Supreme Court decisions are monumental. The decision as to whether the New York law requiring all lenders to pay interest on escrow accounts is preempted under the National Banking Act was left unresolved. Here, the Court reversed and remanded the case to the Second Circuit Court for it to apply the correct standard of whether the state law ‘prevents or significantly interferes with the exercise by the national bank of its powers.”

Beitel’s commentary was included in the following media coverage:

• MortgagePoint: Supreme Court Upholds The Constitutionality Of CFPB Funding 
• The Chrisman Commentary: 5.20.24 Live From New York; Jay Beitel on the Supreme Court and CFPB; Moving Inflation Target