It’s been getting tougher for anyone to mount strong opposition to the Consumer Financial Protection Bureau’s (CFPB) rule banning mandatory arbitration clauses after news broke of more misdeeds at Wells Fargo, which has admitted to forcing borrowers to pay for auto insurance they didn’t need. Although Senate approval of the rule remains uncertain, banks and other lenders should prepare for it to take effect. If that’s a benefit to consumers, it’s one they are going to pay for. Indeed, consumers should prepare for higher costs as a consequence of that preparation and the uncertainty deregulation might fuel….
Years ago, “show me the note” contagion took hold in the subprime mortgage market. Borrowers launched widespread attacks on foreclosure actions once tales of successful early challenges were reported in the media. With the recent reports in The New York Times about National Collegiate Student Loan Trusts’ problems enforcing student loans due to incomplete documentation, the same contagion could again take hold in the nation’s courts.
In the aftermath of the 2008 financial crisis, courts were filled with cases in which borrowers made the technical argument that the securitization trustee trying to foreclose never actually received the relevant note and mortgage—and in some cases,…
As lenders lean on data, algorithms and automation for more efficient loan underwriting, observers have noted that these largely untested tools have yet to go through an economic cycle. The greatest challenge for automated lending, however, may lie in the very technology that drives it. Artificial intelligence and automation aren’t just for lenders, after all—and as companies across industries adopt them in the coming years, the impact on borrowers’ economic stability could be severe. But online lenders, with their fast-moving, adaptable techniques, may be in the best position to respond to these market changes. Their flexibility and responsiveness may put them far ahead of their more traditional lending rivals….
Self-driving cars, car sharing and subscription-based vehicle services: these are destined to affect the auto industry in ways that will make the current sales slump and shift from cars to SUVs seem like a bump in the road. Predictions vary widely as to when the sea change in how we think about cars and how they fit into our lives will come, but its inevitable arrival is often portrayed as part of a brighter, safer, cleaner and more efficient tomorrow.
The dark undercarriage of this issue is the insidious effect that the technology,…
When the Roman philosopher, Seneca, said, “Every new beginning comes from other beginning’s end,” he probably didn’t have litigation cycles in mind, but the quote is apropos of recent actions by defendants in RMBS litigation on the heels, or in anticipation, of their concluding litigation. The statute of limitations may have expired on new claims for repurchase or fraud based on alleged loan defects in pre-financial crisis subprime RMBS deals, but a settlement or litigation award paid out by a defendant may mark the beginning of a new six-year limitations period for the defendant to seek reimbursement or contribution from other deal parties….