Briefing: What’s Happening with Consumer Protection and Mortgages in 2025
What This Is About:
This briefing explains what’s going on with the Consumer Financial Protection Bureau (CFPB)—the government agency meant to protect people from unfair financial practices—and what’s changing in the mortgage and credit world right now. You’ll learn how cuts to the CFPB’s power affect your money and credit, especially when it comes to medical debt and home loans.
Main Points:
1. The CFPB is Losing Power to Protect You
Politics and Budget Cuts: The CFPB’s power to help consumers is being reduced by politics and budget cuts. Some describe the agency as “toothless” because leadership under past administrations weakened its rules and reduced enforcement against banks and lenders.
Fewer Workers, Less Protection: New budget plans could cut the CFPB’s funding in half, reducing staff from around 1,400 people to just 200. Fewer workers mean fewer investigations and weaker protections.
Enforcement Changes: Under President Trump, the CFPB became less aggressive in policing banks and lenders. President Biden tried to strengthen it again, targeting things like overdraft fees and unfair credit reporting. But recent court rulings are blocking many of those efforts.
Lawmakers Are Worried: Some Senators are upset that the CFPB suddenly dropped a case against Navy Federal Credit Union after it charged members millions in overdraft fees—without giving a reason why.
2. Medical Debt Will Stay on Credit Reports (For Now)
New Rule Reversed: A Texas judge cancelled a Biden-era rule that would have erased medical debt from credit reports, meaning medical bills can still lower your credit score.
What This Means for You: If the rule had stayed, about $50 billion of medical debt would’ve been removed from credit reports for around 15 million people. This could have boosted their credit scores and helped thousands more qualify for mortgages each year.
Industry Backed the Reversal: Credit reporting companies supported keeping medical debt on reports, saying it keeps the credit system “fair.”
3. Big Cases Show How the CFPB Is Backing Down
Navy Federal Credit Union: After being caught charging unfair overdraft fees, Navy Federal agreed to pay back $80 million. But strangely, the CFPB canceled the order to enforce this, worrying many consumer advocates.
Toyota Financial Services: In 2023, Toyota’s financing company was fined $48 million for adding unwanted products to auto loans and hurting people’s credit.
FirstCash Inc.: This pawn shop company was fined $9 million for charging illegal high interest rates on loans to military members.
4. What’s Going On with Mortgages in 2025?
Mortgage Rates Keep Changing: As of July 18, 2025, average 30-year fixed mortgage rates were about 6.75%. Rates are bouncing up and down, and the Federal Reserve might raise or lower rates depending on the economy.
Types of Loans You Can Get:
Fixed-Rate Loans: Stable monthly payments, good if you plan to stay long-term.
Adjustable-Rate Mortgages (ARMs): Lower starting rates, but payments can go up later. Better for short-term buyers.
FHA, VA, USDA Loans: Government-backed loans that help first-time buyers or people with lower credit scores.
Boost Your Credit to Get Better Rates: A higher credit score means better mortgage rates. Pay bills on time, reduce credit card balances, and check your credit reports regularly.
Expect Closing Costs: When you buy a home, expect to pay 2% to 5% of your loan amount in closing costs—things like appraisals, title fees, and credit checks.
5. What’s Next for the CFPB?
Supreme Court Decision Brings Uncertainty: A recent Supreme Court ruling about another federal agency (the Education Department) could affect how the CFPB handles its employees and funding. This could further limit its operations.
Focus on “Bad Actors”: Some groups want the CFPB to stop going after every little issue and instead focus only on companies clearly breaking the rules.
Bottom Line: Why This Matters
Right now, the government agency meant to protect consumers from unfair financial practices is shrinking and losing power. Rules to remove medical debt from credit reports were cancelled, and key cases against companies like Navy Federal Credit Union were dropped without explanation. Meanwhile, mortgage rates are fluctuating, and people need strong credit scores to get the best deals. In short, it’s a risky time for borrowers—and consumers should stay informed and cautious as protections weaken.
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