The Consumer Financial Protection Bureau (CFPB) enforces regulations under the Dodd-Frank Act to prevent lenders from trapping consumers in repetitive rollover cycles.
1. Key CFPB Rule Provisions
Two Consecutive Failed ACH Rule
Under federal CFPB rules, a lender cannot attempt an electronic fund transfer (ACH debit) against a consumer's bank account after two consecutive failed attempts due to insufficient funds without new written authorization.
- Payment Withdrawal Transparency: Lenders must provide written notice at least 3 business days before initiating an ACH withdrawal that differs in amount or date from the agreed schedule.
- State Database Registration: Mandatory registration of active loans in real-time state databases to enforce single-loan borrowing limits.