We are living in the time of the most overwhelming change to lending compliance rules and to the structure of the regulatory agencies that enforce the rules since civil rights and consumer protection rules were first written in the late 1960s. We hope the picture will soon develop enough so we can discern the future of compliance.
While the Fed has already begun to wind down it’s regulation writing activities, as evidenced by shelving the huge proposals for open-end and closed-end mortgage lending, they are still moving forward with several other proposed, interim and final rules.
The new Consumer Financial Protection Bureau (CFPB) is staffing up for a massive regulation writing effort. The Dodd-Frank Act requires the CFPB to write major new regulations and to make significant revisions to existing regulations. They officially open for business on July 21st. It is not clear yet how quickly they will start to roll out new and revised regulations.
The interim head of CFPB, Elizabeth Warren, has stated her intent to simplify the current scheme of mortgage loan disclosures. We all agree the goal is noble, but only time will tell whether Ms Warren can complete the task.
We will continue to closely monitor all of this activity and will keep you up to date with events as they occur. At some point the events will line up and reveal the direction in which lending compliance is headed.
These are really interesting times in lending compliance, but the picture in the old crystal ball is still fuzzy. Stay tuned for further details.