Foreclosure Crisis Exposes the Mistrust of Consumers for Banks

The foreclosure crisis has exposed the mistrust of consumers for banks. But the banks couldn’t care less. They took no time in openly opposing Obama’s recent suggestions for the setting up of a regulatory body that would see to the protection of consumers guarding them from the rapacious practices of the lenders.
Edward Yingling of American Bankers Association admitted that reform in regulations is very much required but he was apprehensive that the new entity would enjoy “powers to mandate loans and services that go well beyond consumer protection.”“Modernizing regulation of the financial services industry” got kudos from the Financial Services Roundtable. However it chipped in that there was the fear that the newly set up body would fail to “adequately serve the best interests of consumers and their financial institutions.”

The Consumer Bankers Association commented that the suggested new body “would create a maze of regulations suppressing creativity and product innovation.”
The lending lobby is failing to read between the lines. Obama is keen upon creating a Consumer Financial Protection Agency but that does not mean his main purpose for doing so is to impose his wishes upon the banks. The point is that the banks have repeatedly failed to live up to the expectations of the customers.
Credit card interest rates were allowed to run amok. Mortgages were fashioned to go straight into the arms of foreclosures. Lenders repeatedly showed how callous they were to the interests of their clients. The lenders gave top priority to their own interests disregarding all other issues. By doing so they exposed the simple borrowers to dangerous risks that pulled the carpet away from under their feet. Thus it is the banks who have called upon themselves the need for setting up Consumer Financial Protection Agency.
Gail Hillebrand of Consumers Union said, “They wrecked the system. ”What they’re saying is that they want to keep doing business as usual. But business as usual has failed us.”

Referring to the situation Obama cryptically referred to the situation as “A culture of irresponsibility”.  He admitted that many had taken mortgages they could ill afford but it was also true, he said, “There were also millions of Americans who signed contracts they didn’t always understand offered by lenders who didn’t always tell the truth.”

The task of the Consumer Financial Protection Agency would be bringing about an end to fraudulent practices and seeing to it that the information given by the lenders are detailed and easy to follow.

Related Posts

• Latest White House Plans Will Not Help Only Few Foreclosure Victims
• Foreclosure Victims Only Lip Service Help
• Help For Foreclosed Victims
• Foreclosure Fury Victims
• Tax Relief for Foreclosure Victims