WASHINGTON (7/30/14)--In a stakeholders' check-in meeting on a rule to integrate separate mortgage disclosures rules into a single, more consumer-friendly document, the Credit Union National Association urged the Consumer Financial Protection Bureau to consider three things with respect to its regulatory implementation.
The CFPB's rule to integrate Truth-in-Lending Act and Real Estate Settlement Procedures Act (TILA/RESPA) disclosures will go into effect on Aug. 1, 2015. The new disclosures, mandated by the Dodd-Frank Act, are intended to better help consumers understand the mortgage loan process and make better-informed borrowing decisions.
CUNA Associate General Counsel Jared Ihrig, attending the CFPB roundtable discussion, urged the bureau to consider:
- Making public announcements when it updates guides and other implementation aids on its website, which reflect clarifications or amendments to previously finalized rules. Credit unions rely on these resources, such as the Small-Entity Compliance Guides, and a public announcement would help to ensure they are working with the latest and most reliable guidance concerning the CFPB's rules, Ihrig informed the bureau.
- Providing detailed guidance on the requirements surrounding the effective date of the rule to provide credit unions with as much information as possible to ease the implementation process. Ihrig told the CFPB that many credit unions have voiced their confusion related to the types of transactions and the appropriate disclosures that must be used before, on and after the rule's effective date.
Ihrig also urged the CFPB on CUNA's behalf to perform extensive outreach to forms providers, document preparation companies and technology vendors immediately so that programming and any implementation difficulties can be identified and resolved well prior to the effective date.
As credit unions heavily rely on these vendors for compliance with regulatory requirements, Ihrig explained, it is important to begin this process sooner rather than later to assist credit unions with the implementation of the rule's requirements.
The Tuesday meeting, held with financial institution trade association representatives, was the first of a planned series of four in which the CFPB will meet with mortgage industry participants to gauge progress with implementation efforts.
A second meeting was also held Tuesday and involved real estate settlement and title service providers. A third meeting is scheduled for Aug. 12 with technology vendors and representatives. The date for a final meeting, to be held with creditors, has not yet been announced.
In April, the CFPB issued a guide with an overview of the TILA/RESPA integrated disclosure rule, as well as details on "issues that small creditors, and those that work with them, might find helpful to consider when implementing the rule."
In the guidance, the CFPB notes that financial institutions may want to review their processes, software, contracts with service providers, or other aspects of business operations in order to identify any changes needed to comply with the rule. Use the resource link to access the guidance.