CFPB Issues Outline of RESPA/TILA Rule Proposal
Feb. 27, 2012
On Tuesday, February 21, the Consumer Financial Protection Bureau (CFPB) issued a 42 page outline of issues to be considered in crafting the underlying RESPA/TILA regulations to govern a harmonized RESPA/TILA form set. As forecast, this will be a major regulatory undertaking and many of the earlier RESPA reforms are being reviewed including the scope and rules relating to "tolerances." In some cases CFPB is asking for input on tightening rules and in others loosening rules. The focus of the outline is determining small business and consumer impact of changes. Also, there are many dilemmas facing CFPB on who should bare responsibility for completing settlement statements/ Truth in Lending (TIL) disclosure and the timing of issuing such documents. At present, a revised (TIL) must be in borrowers hands 3 days before closing in most circumstances when required but the HUD-1 only has to be provided the day before closing if requested. CFPB is proposing that a combined TIL/HUD-1 be provided 3 days before closing.
Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, the CPFB is required to propose a regulation by July 21, 2012 and it is expected to do so.