The compliance efforts of the mortgage industry are ongoing. The CFPB has finalized, or is in the process of finalizing, updates to mortgage-related regulations, including the TILA-RESPA Integrated Disclosure Rule (“TRID” or the Know Before You Owe Rule) and Regulation C, which implements the requirements of the Home Mortgage Disclosure Act. Accordingly, industry is continuing its efforts in complying with the updated rules.
Recent and pending updates include:
TRID Updates: The CFPB published its updates to the TRID Rules in July 2017. Among other changes, the updates include tolerance provisions for the total of payments that parallel the tolerances for the finance charge and disclosures affected by the finance charge. The updates also include clarifications for disclosing construction loans and codification of guidance CFPB had previously provided orally or via webinar. The mandatory compliance date is October 1, 2018, but industry has the option to comply with the updates on a rolling basis leading up to the compliance date.
TRID “Black Hole” Proposal: The CFPB has separately proposed a fix for the TRID Rule’s “black hole” issue. The “black hole” occurs when a mortgage lender is unable to use the Closing Disclosure to reset fee tolerances because closing is delayed or rescheduled after the initial Closing Disclosure has been provided. The CFPB issued a proposal on August 11, 2017 regarding a fix for the “black hole,” and comments are due on October 10, 2017.
HMDA/Regulation C Amendments: The CFPB and FFIEC have published several updates to the HMDA/Regulation C reporting rules. Updates include new filing instructions and several clarifications finalized by the CFPB, such as a temporary increase in the threshold reporting HELOCs (from 100 to 500) for the 2018 and 2019 calendar years, and clarifications of several HDMA/Regulation C terms.
However, foremost for industry with regard to HMDA as the final quarter of the year approaches is compliance with the new data collection requirements of the amended HMDA rule. The rule, released on October 15, 2015, revises and in many ways expands the breadth and scope of HMDA data collection requirements—which includes the addition of roughly 25 new data fields and the modification of an additional 12 data fields. Per the rule, industry participants will need to start collecting the new data for credit decisions that will be made in January 2018, to prepare for the first reporting under the amended HMDA Rule. The 2018 data will need to be reported by March 2019.
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