Funding for Consumer Financial Protection Bureau has Consequences for Housing

Legal
Published
Contact: Thomas Ward
[email protected]
VP, Legal Advocacy
(202) 266-8230

In a case that could have significant repercussions for the housing industry, the U.S. Supreme Court on Oct. 3 heard oral arguments in Consumer Financial Protection Bureau (CFPB) v. Community Financial Services Association of America.

The case centers on whether the way the CFPB receives its funding is a violation of the Appropriations Clause of the U.S. Constitution. Congress allows the CFPB to be funded through the Federal Reserve, rather than the annual appropriations process that determines the federal budget.

NAHB joined the Mortgage Bankers Association and the National Association of Realtors to file an amicus brief warning the Supreme Court that the “housing market could descend into chaos” if the high court unwittingly rejected numerous mortgage rules that NAHB’s members rely on to ensure people can purchase homes.

Our coalition’s brief focused on the remedy if the Supreme Court found against CFPB and did not make any arguments concerning the constitutionality of the funding scheme.

The attorneys for both parties received strong questioning from the justices concerning CFPB’s funding and how it could craft a remedy if it found the CFPB’s funding is unconstitutional. Solicitor General Elizabeth Prelogar specifically mentioned NAHB’s brief when she suggested that the Supreme Court could address only the funding — and not the rules — that the CFPB has developed.

Moreover, Justice Sonia Sotomayor stated her concern about the market disruption that would occur if the Supreme Court jettisoned the rules that the mortgage market relies on. The attorney for the Community Financial Services Association (CFSA) suggested that the Supreme Court could stay its decision and send the case to Congress so it could develop a different way to fund the CFPB.

In the end, both liberal and conservative justices seemed to have trouble understanding the CFSA’s argument that the CFPB funding scheme violated the Appropriations Clause. Justice Clarence Thomas specifically commented that it was not enough to argue that Congress has never funded an agency in this manner; there must be a reason why that violates the Constitution.

NAHB expects a decision by early 2024.

Subscribe to NAHBNow

Log in or create account to subscribe to notifications of new posts.

Log in to subscribe

Latest from NAHBNow

IBS

Feb 20, 2026

NAHB Announces Best of IBS Winners at International Builders’ Show

The National Association of Home Builders (NAHB) named the winners of its 13th annual Best of IBS™ Awards during the NAHB International Builders’ Show® (IBS) in Orlando. The awards were presented during a ceremony held on the final day of the show.

Sponsored Content

Feb 20, 2026

How Land Developers are Leveraging AI to Move Faster

AI is helping today's leading land development teams operate differently. By connecting data across ownership, zoning, infrastructure, and development activity, AI can surface early signals of opportunity and support faster, more informed go/no-go decisions

View all

Latest Economic News

Economics

Feb 20, 2026

New Home Sales Close 2025 with Modest Gains

New home sales ended 2025 on a mixed but resilient note, signaling steady underlying demand despite ongoing affordability and supply constraints. The latest data released today (and delayed because of the government shutdown in fall of 2025) indicate that while month-to-month activity shows a small decline, sales remain stronger than a year ago, signaling that buyer interest in newly built homes has improved.

Economics

Feb 20, 2026

U.S. Economy Ends 2025 on a Slower Note

Real GDP growth slowed sharply in the fourth quarter of 2025 as the historic government shutdown weighed on economic activity. While consumer spending continued to drive growth, federal government spending subtracted over a full percentage point from overall growth.

Economics

Feb 19, 2026

Delinquency Rates Normalize While Credit Card and Student Loan Stress Worsens

Delinquent consumer loans have steadily increased as pandemic distortions fade, returning broadly to pre-pandemic levels. According to the latest Quarterly Report on Household Debt and Credit from the Federal Reserve Bank of New York, 4.8% of outstanding household debt was delinquent at the end of 2025, 0.3 percentage points higher than the third quarter of 2025 and 1.2% higher from year-end 2024.