0
0
0

CFPB proposes important TRID updates

by Chip Bell

CFPB-TRID-updates-tolerances-lenders

The Consumer Financial Protection Bureau today proposed new updates to TRID intended to formalize guidance in the rule, and provide clarity and certainty. The point is to help facilitate compliance within the mortgage industry.

“The Bureau’s rules are designed to make sure consumers have the information they need, in a form they can easily understand and use, before making the decision,” said CFPB Director Richard Cordray. “Our proposed updates will clarify parts of our mortgage disclosure rule to make for a smoother implementation process.”

According to the CFPB’s statement, the proposed changes include:

Tolerances for the total of payments – The Bureau is proposing to include tolerance provisions for the total of payments that parallel existing tolerances for the finance charge and disclosures affected by the finance charge. This change would make the treatment of the total of payments disclosure consistent with what it was prior to the Know Before You Owe mortgage disclosure rule.

Housing assistance lending – The Bureau’s proposed update would promote housing assistance lending by clarifying that recording fees and transfer taxes may be charged in connection with those transactions without losing eligibility for the partial exemption. The rule would also exclude recording fees and transfer taxes from the exemption’s limits on costs. Through the proposed update, more housing assistance loans would qualify for the partial exemption, which should encourage lenders to partner with housing finance agencies to make these loans.

Cooperatives – The Bureau is proposing to extend the rule’s coverage to include all cooperative units. Cooperatives are sometimes treated as personal property under state law and sometimes as real property. By including all cooperatives in the rule, the Bureau would simplify compliance.

Privacy and sharing of information – The Bureau is proposing additional commentary to clarify how a creditor may provide separate disclosure forms to the consumer and the seller.

The CFPB’s announcement comes amidst a bevy of complaints lenders have lobbed at the Bureau since TRID took effect in Oct. 2015. And in a statement from Mortgage Bankers Association President and CEO David Stevens, who’s been a vocal proponent of TRID amendments, praised the proposed updates.

“MBA appreciates the CFPB’s efforts to update and clarify certain aspects of the ‘Know Before You Owe’ rule,” he said. “This particular regulation has a big impact on both borrowers and lenders, so it’s important that the Bureau and stakeholders continually reassess the implementation process to ensure its effectiveness. We look forward to commenting on the rule, and continuing to work with the CFPB to gain further clarity in order to improve this and other rules and regulations.”

Read More Related to This Post

Join the conversation

New Subscribe