TheMReport

TH E M R EP O RT | 59 O R I G I NAT I O N S E R V I C I N G DATA G O V E R N M E N T S E C O N DA R Y M A R K E T THE LATEST GOVERNMENT CFPB Corrects, Clarifies Final Rule Amendments The Bureau has issued policy guidance on the three-day early compliance period. T he Consumer Finan- cial Protection Bureau (CFPB) has taken two big steps in clarifying its amendments to the 2013 mort- gage servicing rules, which were issued in August 2016. Recently, the Bureau released direct-to- final technical corrections to the amendments, as well as policy guidance on the three-day early compliance period spelled out in the 2016 final rule. Regarding the corrections, the Bureau called them "non-substan - tive" and will publish the final rule with the Federal Register. "The corrections address two typographical errors, the author- ity citation for Regulation Z, and several amendatory instructions relating to certain official com - mentary to apply the correct ef- fective date," the CFPB reported. The second clarification released by the Bureau was what the CFPB dubbed "Policy Guidance on Supervisory and Enforcement Priorities Regarding Early Compliance with the 2016 Amendments to the 2013 Mortgage Rules Under the Real Estate Settlement Procedures Act (Regulation X) and the Truth in Lending Act (Regulation Z)." The issue is nonbinding and relates to a three-day period of early com - pliance on the final 2016 rule. "Some provisions in the 2016 final rule will take effect on Oct. 19, 2017; the remainder will take effect on April 19, 2018," the CFPB reported. "This nonbinding policy guidance addresses early compli - ance for up to three days preced- ing each effective date." The guidance stems from what the CFPB calls "concerns" about the effective dates—which fall in the middle of the work week—of each provision. "The Bureau has heard con - cerns that these midweek effec- tive dates for the 2016 Mortgage Servicing Final Rule could create operational challenges for servicers," the guidance reads. "The Bureau understands that, for many servicers, the Thursday effective dates could afford less than a full day—from the close of business overnight on each of the preceding Wednesdays—to update and test systems in order to be compliant with the 2016 amendments. If servicers do not have sufficient time to complete these tasks, their systems may be more likely to produce errors, which could expose servicers and consumers to risk. Industry participants have notified the Bureau that implementing the 2016 Mortgage Servicing Final Rule during the weekend, with early compliance beginning on the Monday before each of the re - spective Thursday effective dates, would address these concerns." The guidance will also be published with the Federal Register, according to the CFPB. New Law May Change HMDA Reporting The bill would alter thresholds for the Home Mortgage Disclosure Act. A bill by Rep. Tom Em- mer (R-Minnesota) that would increase the re- porting threshold under the Home Mortgage Disclosure Act of 1975 for open-end lines of credit and closed-end mortgage was introduced in June. Dubbed the Home Mortgage Disclosure Adjustment Act of 2017 (HMDA), the bill would exempt depository institutions with originations in the last two years under 2,000 open-end lines of credit and 1,000 closed-end mortgages from HM - DA's reporting and recordkeep- ing requirements. It would also withdraw the new and modified HMDA data points found in the CFPB's rule. Blaine Luetkemeyer, Chairman of the House Financial Services Subcommittee on Financial Institutions and Consumer Credit, is an original co-sponsor of the bill. "NAFCU thanks Rep. Emmer for introducing this important legislation that would ease the compliance burden for credit unions that will result from the HMDA rule requirements," said Brad Thaler, VP of Legislative Affairs for the National Association of Federally-Insured Credit Unions. "We also thank Chairman Luetkemeyer for co- sponsoring this legislation. We look forward to working with the House and other members of Congress on this bill and other efforts to secure more credit union regulatory relief." This isn't the first bill of its kind. Sen. Mike Rounds (R-South Dakota), and Heidi Heitkamp (D-North Dakota), introduced similar legislation earlier this year that sought to exempt depository institutions that originated fewer than 500 open-end lines of credit and closed-end mortgages. A majority of the new HMDA requirements will come into effect January 1, 2018, affecting home equity lines of credit, establishing transactional thresholds for cover - age, and expanding the number of HMDA data points to be collect- ed from credit unions. According to NAFCU, they have long urged the CFPB to use the authority it has under the Dodd-Frank Act to provide credit unions more exemptions from its rules. "NAFCU thanks Rep. Emmer for introducing this important legislation that would ease the compliance burden for credit unions that will result from the HMDA rule requirements." —Brad Thaler, VP of Legislative Affairs, National Association of Federally-Insured Credit Unions

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