Removing Barriers Blog

CUNA Supports Proposed Change to Reg Z Mortgage Servicing Rules
Posted November 15, 2017 by CUNA Advocacy

In a letter sent last week to the CFPB, CUNA supports a proposed change to the Reg Z mortgage servicing rules (effective April 2018). 

The current rule provides a “single-billing-cycle” exemption from the requirement to provide a periodic statement to a borrower who has filed bankruptcy. Although the current rule hasn’t yet gone into effect, the CFPB has heard from industry that the single-billing-cycle exemption may be problematic in certain instances due to timing issues. Therefore, the CFPB has proposed to replace the single-billing-cycle exemption with a “single-statement” exemption. 

We support the proposed change, as we believe it will provide a clearer and more straightforward standard than the existing timing requirement. However, the impact on credit unions will be somewhat limited since many are considered small servicers and therefore exempt from certain mortgage servicing provisions, including those on the periodic statement. 

It was nice to see, for a change, the Bureau considering improvements to a new rule well ahead of its effective date. We thanked the CFPB for this approach and asked it to maintain it in future rulemakings.