CFPB Issues Changes to Servicing Rule that Goes into Effect This Week

10/17/17

The Consumer Financial Protection Bureau (CFPB) has announced an interim final rule tweaking one of the early intervention (§ 1024.39 of Regulation X) changes effective October 19. The change only affects servicers who are subject to the Fair Debt Collection Practices Act with respect to mortgage loans on which consumers have invoked their cease communication rights, and it provides a 10-day window for delivery of a modified written early intervention notice under certain specific situations. The interim rule, which has been posted to BOL’s Regulations pages for Regulation X, is effective Oct. 19. Comments on the interim rule are due within 30 days of Federal Register publication.

The Bureau also announced a proposed rule that would amend new § 1026.41(e)(5) to adjust the timing requirement for the transition to and from modified periodic statements or coupon books in connection with a consumer’s bankruptcy case, in order to alleviate unintended challenges in implementation. Comments on the proposal will be accepted for 30 days following publication in the Federal Register. Any final rule will be effective Apr. 19, 2018.

Question of the Week

We are not located near a military base. Do we still need to check all of our credit applicants against the MLA database?

The safest recommendation would be to ensure that you comply with one of the two safe harbors for covered borrower determination under the rule. This means that you can check your member against the MLA database to determine if they are active duty, or you can obtain a consumer credit report that indicates if the member is a covered borrower or not. If you do not make the determination at the time the member becomes obligated to or opens a credit account, the credit union can be subject to harsh penalties if the member was a covered borrower at the time the loan was obtained.

Resources

32 CFR 232.5(b)

32 CFR 232.9

Legal Briefs

Consumer Financial Protection Bureau (CFPB)

The CFPB has updated its TRID Small Entity Compliance Guide to reflect the amendments from the July 7, 2017 final rule.

The CFPB has updated its HMDA Small Entity Compliance Guide to reflect the amendments from the August 24, 2017 final rule.

Federal Reserve Board (FRB)

The FRB announced that it has extended the comment period for its proposal to enhance the effectiveness of board of directors and its proposal to implement new rating systems for large financial institutions. Comments, originally due on October 10th and 16th (respectively), are now due on November 30, 2017.

The October edition of FedFlash is now available.

The September Minutes of the Federal Open Market Committee are now available.

The FRB announced that it is implementing its normal year-end freeze period for production check services in order to support year-end activities and 2018 changes. December 21, 2017 will be the last day for Production Check implementations and changes, with normal operations resuming on January 4, 2017.

The FRB announced that Randal K. Quarles took the oath of office as a member of the Board of Governors of the Federal Reserve System and Vice Chair for Supervision.

FBR Chair Yellen delivered a prepared speech at the G-30 International Banking Seminar in Washington, D.C.  Yellen’s remarks focused on the current and expected status of the labor market, inflation, and the current economic environment.

Federal Deposit Insurance Corporation (FDIC)

FDIC Chairman Gruenberg delivered remarks at the FDIC’s Seventh Annual Consumer Research Symposium. Gruenberg’s remarks focused on how the FDIC’s research has aided the agency in analyzing consumer protection supervision and economic inclusion.

Office of the Comptroller of the Currency (OCC)

The OCC issued Bulletin 2017-40 announcing changes to its Policies and Procedures Manual regarding framework for determining the effect of evidence of discriminatory or other illegal credit practices on the CRA rating of a national bank, federal savings association, or federal branch.

Office of Foreign Assets Control (OFAC)

OFAC has updated the SDN list as of October 13, 2017. The last update prior to this was October 12, 2017.

Questions? Contact the Compliance Hotline: 1.800.546.4465, compliance@nwcua.org.

Posted in Compliance News, Compliance News.