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75 May 2025 J O U R N A L May 2025 » » The mortgage holder is not in active bankruptcy (and neither is anyone else listed on the loan) when the servicer submits the loan into the program. The VA did accept a dismissed or discharged bankruptcy (Chapter 13 or Chapter 7). » The mortgage holder has resolved the reason they were in default and can begin making monthly mortgage payments again. » The mortgage holder and anyone else listed on the loan have a stable and reliable source of income. » The VA-guaranteed loan is in a first- lien position, and the property doesn't have any liens or judgments that would risk a first-lien position. » The mortgage holder has made at least six monthly payments since the start of the loan (or since any modification to it). » The mortgage holder is the legal owner of record on the property. » The mortgage holder and all others listed on the loan agree to the terms of the VASP modification. "Financial hardship happens to everyone, and it's a bedrock principle of federal housing policy that borrowers with a financial hardship should be able to bring their loans current and avoid foreclosure if they can afford the new plan," said Mike Calhoun, President of the Center for Responsible Lending (CRL). "Congress quickly enacting a partial claim program would benefit veteran homeowners and the VA as well, since avoidable foreclosures on feder- ally backed loans result in unnecessary government losses." CFPB SHIFTS ENFORCEMENT PRIORITIES, REDUCES STAFF T he Wall Street Journal has reported that a letter was sent to Consumer Financial Protection Bureau (CFPB) staffers from Bureau Chief Legal Officer Mark Paoletta outlin- ing how the agency will channel its focus on "tangible harm to consumers" by reallocating resources from enforcement and supervision activities that can be done by states. "The Bureau will focus its enforce- ment and supervision resources on press- ing threats to consumers, particularly service members and their families, and veterans," said Paoletta in the memo. "To focus on tangible harms to consumers, the Bureau will shift resources away from enforcement and supervision that can be done by states. All prior enforce- ment and supervision priority docu- ments are hereby rescinded." The memo from Paoletta continued that the Bureau will turn its attention to mortgage fraud as its "highest priority," followed by Fair Credit Reporting Act (FCRA)/Regulation V data furnishing violations; Fair Debt Collection Practices Act (FDCPA)/Regulation F violations relating to consumer contracts/debts; various fraudulent overcharges, fees, etc.; and the protection of consumer info resulting in actual loss to consumers. While listing what will take enforce- ment precedence moving forward, the Bureau announced that it will depriori- tize the following: » Loans for "justice involved" individu- als (criminals) » Medical debt » Peer-to-peer platforms and lending » Student loans » Remittances » Consumer data » Digital payments In shifting its supervisory efforts back to depository institutions, Paoletta noted that in 2012, 70% of the CFPB's supervision focused on banks and depos- itory institutions, and 30% on nonbanks. In his memo, he noted that those figures have reversed course, as more than 60% of CFPB's supervision is focused on non- banks and less than 40% on banks and depository institutions. "The Bureau must seek to return to the 2012 proportion and focus on the largest banks and depository institu- tions," Paoletta wrote. According to news outlet Govern- ment Executive, the CFPB has issued Reductions in Force (RIFs) for roughly 1,500 of its personnel, amounting to approximately 88% of its workforce. In addition to the RIFs, the Bureau reportedly slashed 50% of those respon- sible for inspection operations of the nation's financial services companies. Employees were informed they would be locked out by 6 p.m. on April 18, and would be separated from federal service by June 16, barring qualifications for other available positions. Turnover at the Bureau began in February with the dismissal of CFPB Di- rector Rohit Chopra by President Donald Trump, who had served in the role since being appointed by President Joe Biden in 2021 for a five-year term. Less than 48 hours after Chopra was removed as Di- rector of the Bureau, Treasury Secretary Scott Bessent was named acting head of the CFPB. Russell Vought, Director of the Of- fice of Management and Budget (OMB), then took over as Acting Administrator of the CFPB, instructing Bureau staffers to work from home, while halting all CFPB enforcement efforts. Jonathan McKernan, most recently a Director on the Board of the Federal Deposit Insurance Corporation (FDIC), was then nominated by the Trump ad- ministration as the next Director of the CFPB. McKernan's nomination has yet to be considered by the Senate. The CFPB was established by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 in the wake of the financial crisis of 2007- 2008. The role of the CFPB is to review the practices of companies, banks, and lenders in the financial services industry and work to protect consumers from predatory practices. Authorized by Congress in 2010, the role of the CFPB is to reform preda- tory and deceptive financial industry practices that policymakers believed led to a wave of mortgage defaults, and ultimately to the crisis and subsequent Great Recession.