In this episode of On the Hill, Tim Rood, Head of Industry Relations, speaks with Kathleen L. Kraninger, former Director of the Consumer Financial Protection Bureau (CFPB). Kraninger led the mission and operations for the 1,500-person independent, regulatory and law enforcement agency from December 2018 until January 2021. She worked to facilitate innovation, promote financial inclusion and lead through the economic uncertainty of the global pandemic.
Kraninger offers advice for mortgage servicers preparing for a more vigorous post-pandemic enforcement environment. “It really gets back to that fundamental issue: treating borrowers fairly, communicating their options clearly,” she said. “If there are options in terms of the loss mitigation waterfall that consumers have in front of them that’s something that absolutely needs to be communicated clearly and thinking about what the beneficial outcome could be for consumers.”
Servicers must have a thorough compliance management system in place, with good processes, well-trained employees and documentation for engagements and interactions with borrowers. “If you’re behind the eight ball on that you’re definitely in trouble,” she added.
Kraninger also shared her view on partisanship in Washington, D.C. and the challenges of navigating the regulatory and legislative maze. “It is definitely easier to stop something from happening than to actually put something positive, new or different into place,” she said.
Kraninger has served on the board of the Federal Deposit Insurance Corporation, the Financial Stability Oversight Board, and as chair of the Federal Financial Institutions Examinations Council. She worked at the Departments of Transportation and Homeland Security, the Office of Management and Budget, and in both the Senate and the House of Representatives. Kraninger graduated magna cum laude from Marquette University and earned a law degree from Georgetown University Law Center. She served as a U.S. Peace Corps Volunteer in Ukraine.