On November 16, 2012 the Consumer Financial Protection Bureau (CFPB) announced that it will give creditors extra time to provide certain new disclosures required under the Dodd-Frank Wall Street Reform and Consumer Protection Act in order to allow a more seamless integration with other mortgage disclosures that have been proposed by the Bureau.
The Dodd-Frank Act:
- Requires the CFPB to integrate certain disclosures from the Truth in Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA). In July, the CFPB proposed new Loan Estimate and Closing Disclosure forms.
- Establishes additional new mortgage disclosure requirements, which would automatically take effect on Jan. 21, 2013 unless other action was taken. These new requirements include disclosures on cancellation of escrow accounts, on a consumers’ liability for debt payment after foreclosure, and on the creditor’s policy for accepting partial payment. The CFPB integrated many of these new requirements into the CFPB’s proposed forms that were released in July 2012.
The CFPB’s July TILA-RESPA integration proposal requested comment on granting more time for companies to provide many of the additional disclosures so that the entire TILA-RESPA disclosure regime could take effect together. Without this extra time, creditors would have to implement these new disclosures twice—once on January 21, 2013, and once again when the Bureau finalizes the integrated disclosures. Comments overwhelmingly supported providing the extra time so that all of the disclosures take effect together. The November 16th final rule assures that result. The CFPB anticipates that the final rules will be published next year.