CFPB Updates Mortgage Origination Examination Procedures to Reflect TRID. The CFPB has put out an updated version of its Supervision and Examination Manual’s Mortgage Origination examination procedures. The latest iteration features guidance on how its compliance examiners will examine loan disclosures and the terms of closed-end residential mortgages that are subject to the pending integrated disclosure rule under the Truth in Lending Act and the Real Estate Settlement Procedures Act. Of the manual’s eight modules, the updated TRID examination procedures are reflected in module #4. “Examiners should obtain and review a sample of complete loan files to assess the entity’s compliance,” states the new section of the manual. “If consumer complaints regarding mortgage origination and closing indicate potential violations of ...

Residential mortgages held in portfolio would be granted safe-harbor qualified-mortgage status under draft regulatory relief legislation circulated early this week by Sen. Richard Shelby, R-AL, chairman of the Senate Banking, Housing and Urban Affairs Committee. To get that classification, the lender would have to hold the loan in portfolio from inception, and any person acquiring the loan must continue to hold it in portfolio. The loan cannot provide for negative amortization or interest-only payments, and the loan term could not exceed 30 years. Also, the lender would still have...

Consumer Financial Protection Bureau Director Richard Cordray continues to tell the mortgage industry and its allies in Congress that the CFPB will not look the other way while the industry grapples with implementation of the integrated mortgage disclosure rule. The director’s latest official rebuff was delivered in a recent letter to Rep. Blaine Luetkemeyer, R-MO, who has been pressing the director for some kind of an enforcement grace period. Cordray historically has been...

The mortgage industry has just under 100 days until the do-or-die deadline of August 1 kicks in for compliance with the CFPB’s integrated disclosure rule under the Truth in Lending Act and the Real Estate Settlement Procedures Act, otherwise known as the TRID. And as the new lending environment approaches, industry anxieties are getting stronger and more specific in nature. “The primary concerns that I am hearing are about the inability to reset the fee tolerances when the closing date is significantly delayed, which many fear will require lenders to start over and scuttle closings, and the lack of guidance for wholesale lenders who work with brokers,” said Benjamin Olson, counsel in the Washington, DC, office of the BuckleySandler law ...

The CFPB told the U.S. Court of Appeals for the Fifth Circuit that property tax loans should get consumer protections under the federal Truth in Lending Act. The CFPB made its case in an amicus brief with the court in Billings v. Propel Financial Services, LLC. The legal question presented in this case is whether a private lender extends “consumer credit” under the Truth in Lending Act by providing loans to consumers for the purpose of paying off residential property-tax delinquencies.The bureau asserted its legal interest in the case on the grounds that it is the federal agency charged with interpreting and promulgating rules under TILA, and because it has authority to enforce compliance with the requirements of TILA....

David Silberman, associate director of research, markets and regulations at the CFPB, told members of Congress recently that the bureau will continue to work with the mortgage industry as it implements and adapts to the pending integrated disclosure rule under the Truth in Lending Act and the Real Estate Settlement and Procedures Act. “The bureau’s work supporting implementation of the integrated disclosure rule does not end with the effective date of the integrated disclosure rule,” Silberman told the House Financial Services Subcommittee on Financial Institutions and Consumer Credit recently. “We expect to continue working with industry, consumers, and other stakeholders to answer questions, provide guidance, and evaluate any issues industry and consumers experience as the integrated disclosure rule is implemented.” ...

FFIEC Issues Revised Interagency Examination Procedures for Compliance with the TRID. The Task Force on Consumer Compliance of the Federal Financial Institutions Examination Council recently put out new interagency examination procedures for the Truth in Lending Act (TILA), as implemented by Regulation Z, and the Real Estate Settlement Procedures Act (RESPA), as implemented by Regulation X. These procedures reflect CFPB amendments to Regulations Z and X published in the Federal Register in December 2013 and February 2015. Most of the changes to the procedures relate to the integrated mortgage disclosure requirements under TILA and RESPA, commonly referred to as the “TRID” requirements. Office of the Comptroller of the Currency Bulletin 2015-27 makes available on the OCC website the revised interagency ...

The odds that the CFPB will publicly announce or tacitly concede some degree of soft enforcement of its integrated disclosure rule, known as TRID, may have improved recently when two Republican Congressmen called on the bureau to give the mortgage industry such a break when the rule kicks in Aug. 1, 2015. “We strongly encourage you to make the August 1, 2015, to December 31, 2015, timeframe a ‘hold harmless’ period of restrained enforcement and liability,” said Reps. Blaine Luetkemeyer, R-MO, and Randy Neugebauer, R-TX, in a letter recently sent to CFPB Director Richard Cordray. “This would allow all parties to better understand the changes associated with TRID and help ensure consumer confidence and stability in the nation's housing market,” ...

Small nonbank mortgage lender groups and other industry representatives once again took the opportunity provided by sympathetic Republicans in Congress to express their anxiety about being able to comply with the pending integrated disclosure rule from the Consumer Financial Protection Bureau when it kicks in Aug. 1, 2015. They echoed a call made late last month by Reps. Blaine Luetkemeyer, R-MO, and Randy Neugebauer, R-TX, for the CFPB to institute a ...

Shortly before the U.S. Congress vacated the nation’s capital for its spring recess, the House Financial Services Committee passed, with varying levels of bipartisan support, a package of regulatory relief bills, including a handful related to rulemakings from the CFPB. Most notable among them is H.R. 685, the Mortgage Choice Act, sponsored by Rep. Bill Huizenga, R-MI. H.R. 685 aims to assist banks that originate mortgages through the wholesale channel by modifying the points-and-fees formula in the CFPB’s ability-to-repay rule. The measure would exclude from the calculation insurance and taxes held in escrow and fees paid to affiliated companies as a result of participating in an affiliated business arrangement. The committee approved the bill by a 43-12 vote, despite a ...