‘Know Before You Owe’ Rule to be Delayed Two Months
June 18, 2015
June 18, 2015
The Consumer Financial Protection Bureau (CFPB) announced on Wednesday that, due to an administrative error, it would propose a two-month delay in the implementation of the Know Before You Owe rule on mortgage disclosures.
“The CFPB will be issuing a proposed amendment to delay the effective date of the Know Before You Owe rule until October 1, 2015,” said CFPB Director Richard Cordray in a statement. “We made this decision to correct an administrative error that we just discovered in meeting the requirements under federal law, which would have delayed the effective date of the rule by two weeks.”
The rule creates an “integrated disclosure” by combining requirements of the Truth in Lending Act and the Real Estate Settlement Procedures Act. Credit unions, other financial institutions, industry groups, and nearly 300 members of Congress have urged a delayed implementation.
“The Association has been advocating for a longer runway for this rule,” said NWCUA Associate Vice President of Regulatory Affairs John Trull. “Although we did not expect it to come due to an administrative error, we are glad for the extended implementation period.”
Below is a general list of steps a credit union should take to implement the new rules:
- Become familiar with new requirements
- Determine what business and process changes need to be adopted in order to meet compliance requirements
- Executive review and plan implementation
- Work with third party vendors and settlement service providers on software and disclosure updates
- Staff training
- System testing and rollout
Cordray’s statement continued, “We further believe that the additional time included in the proposed effective date would better accommodate the interests of the many consumers and providers whose families will be busy with the transition to the new school year at that time.”
The public will have an opportunity to comment on the proposed amendment and a final decision is expected shortly thereafter.
Questions about this story? Contact James Pearson: 206.340.4790, firstname.lastname@example.org.
Posted in Compliance.