CFPB Proposes Mortgage Rule Clarifications

A proposal making technical corrections in the CFPB’s rules on escrow accounts would also preserve existing consumer protections in connection with higher-priced mortgage loans until Jan. 10, when several new CFPB mortgage rules are set to take effect.

The proposal, detailed on the NAFCU Compliance Blog and in a NAFCU Regulatory Alert, would:

• clarify how to determine whether or not a county is considered “rural” or “underserved” for purposes of applying an exemption in the escrows rule and special provisions adopted in three other Dodd-Frank Act mortgage rules; and

• continue protections regarding assessments of consumers’ ability to repay and prepayment penalties on certain higher-priced mortgage loans until next Jan. 10.

The CFPB said the new escrows rule adopted in January can be read to cut off the old protections before new, expanded protections go into effect. The escrows rule takes effect this June, so this would create a six-month lapse in those protections. The CFPB said comments on the proposed rule will be due 15 days after its publication in the Federal Register.

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