On April 29, 2013 the Consumer Financial Protection Bureau published an 86-page final rule to amend Regulation Z. The final rule has four main elements: First, the final rule generally removes references to an independent ability-to-pay standard from Section 1026.51(a)(1) and associated commentary. As a result, card issuers are no longer required to consider whether consumers age 21 or older have an independent ability to pay; instead, card issuers are now required by Regulation Z […]
Category: Lending Compliance
DELAY IN CREDIT INSURANCE EFFECTIVE DATE
On May 8 the Consumer Financial Protection Bureau (CFPB) published a proposal to temporarily delay the June 1, 2013, effective date of the prohibition on financing credit insurance premiums in connection with consumer credit transactions secured by a dwelling. The temporary delay provides the CFPB time to clarify, before the provision takes effect, its applicability to transactions other than those in which a lump-sum premium is added to the loan amount at closing. The proposal […]
ANOTHER HUD MATERNITY LEAVE CASE
The U.S. Department of Housing and Urban Development (HUD) recently announced that it has reached yet another agreement with a mortgage lender that apparently discriminated against a woman on maternity leave. The lender entered into the agreement to settle allegations that it denied woman a mortgage loan because she was pregnant and on maternity leave. The Fair Housing Act prohibits discrimination in the sale, rental, and financing of dwellings, and in other housing-related transactions, based on […]
CFPB PROPOSES MORE CHANGES TO THE QM AND SERVICING CHANGES
On April 19th the Consumer Financial Protection Bureau (CFPB) proposed changes to the Qualified Mortgage (QM) and Servicing Rules. The proposal addresses five topics: Debt-to-Income Ratio Under the Ability to Repay rule, a lender may make a qualified mortgage (QM), a loan for which certain features are prohibited and fees that can be charged are limited. The rule provides for different types of QMs, the main type requiring that a consumer’s debt-to-income ratio (DTI) show […]
CFPB PUBLISHES REGULATION Z ESCROW GUIDANCE
On April 19th the Consumer Financial Protection Bureau (CFPB) published TILA Escrow Rule Small Entity Compliance Guide. The 21- page Guide provides a summary of the TILA Escrow Rule. The guide also highlights issues that small creditors might find helpful to consider when implementing the rule. The Guide is available here.