Now is your opportunity to be heard, thanks to two recent invitations from the Consumer Financial Protection Bureau (CFPB or Bureau).
In March, Acting CFPB Director Mick Mulvaney published two Requests for Information (RFIs) asking for public comment on regulations that the Bureau inherited from other federal agencies (Inherited Regulations) or has issued under the authority of the Dodd Frank Act (Adopted Regulations). The comments will help the CFPB decide whether to amend any of these rules or issue new rules. Comments on Inherited Regulations are due on June 25, and comments on Adopted Regulations are due on June 19.
“We want information from you,” Mulvaney said in March 1 remarks before the U.S. Chamber of Commerce. “We want to hear from everybody.”
What Regulations are at Stake
Inherited Regulations: The Dodd-Frank Act gave the CFPB rulemaking authority for fourteen federal consumer protection laws, including the Real Estate Settlement Procedures Act (RESPA), the Truth in Lending Act (TILA), the S.A.F.E. Mortgage Licensing Act, and the Equal Credit Opportunity Act (ECOA). Inherited Regulations are regula-tions issued by other agencies (such as RESPA regulations issued by HUD) that were transferred to the CFPB on July 21, 2011. The RFI does not include the CFPB’s 2015 Home Mortgage Disclosure Act (HMDA) rule, because the CFPB has separately announced its intention to reconsider this rule.
Adopted Regulations: Dodd-Frank also gave the CFPB new rulemaking authority in certain areas. Some Adopted Regulations, such as the Loan Originator Compensation and TILA-RESPA Integrated Disclosure (TRID) rules, amended Inherited Regulations. Adopted Regulations also include the Ability-to-Repay (Qualified Mortgage) regula-tion, which likely is on the CFPB’s priority list since it is a “significant” rule that Dodd-Frank required to be assessed within five years after its effective date (January 10, 2019). Another motivation for the CFPB to assess the Ability-to-Repay regulation is that the GSE patch – which allows GSE-eligible loans to qualify for Qualified Mortgage status even if they exceed the standard 43 percent debt-to-income ratio – lasts only as long as Fannie Mae and Freddie Mac are in federal conservatorship (January 10, 2021). The Trump Administration has recommended that the CFPB work to align Qualified Mortgage requirements with GSE eligibility requirements, ultimately phasing out the GSE patch.
What the CFPB Wants
The Bureau is seeking feedback on potential changes to the regulations that could help them more effectively meet the statutory purposes of the Federal consumer finance laws and Dodd-Frank. Specifically, it asks how aspects of the regulations:
• Should be tailored to institutions of a particular type or size;
• Create unintended consequences;
• Overlap or conflict with other laws or regulations in a way that makes it difficult or burdensome for institutions to comply;
• Are incompatible or misaligned with new technologies; and
• Should be modified to provide consumers greater protection from identity theft.
Commenters are asked to offer their highest priorities, and to single out their top priority. Suggestions should focus on revisions that the Bureau could implement without Congressional action.
And That’s Not All…
These are the eighth and ninth RFIs in Mulvaney’s initiative to reexamine the Bureau’s existing policies
and procedures. The CFPB also has asked for public comments on its enforcement and supervision processes, its consumer complaint database, and other internal functions. The previous seven RFIs with their comment due dates are:
• Civil Investigative Demands (CIDs): April 26, 2018
• Rules of Practice of Adjudication Proceedings: May 7, 2018
• Enforcement Processes: May 14, 2018
• Supervision Program: May 21, 2018
• External Engagements: May 29, 2018
• Consumer Complaint Database: June 4, 2018
• Rulemaking Process: June 7, 2018
Mulvaney’s Requests for Information will create an extensive record that can be a foundation for the next CFPB Director to reshape federal consumer finance regulations and the Bureau’s enforcement and supervision procedures. So, if your company has had issues with the CFPB, now is the time to direct your legal counsel to put your complaints in writing – with constructive ideas on how they can be improved.
Now is your opportunity to be heard, thanks to two recent invitations from the Consumer Financial Protection Bureau