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CFPB RIN: 3170-AA17 Publication ID: Spring 2013 
Title: Ability-to-Repay and Qualified Mortgage Standards Under the Truth in Lending Act (Regulation Z)  
Abstract: The Board of Governors of the Federal Reserve System (Board) published for public comment on May 11, 2011, a proposed rule amending Regulation Z to implement amendments to the Truth in Lending Act (TILA) made by the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act). Regulation Z currently prohibits a creditor from making a higher-priced mortgage loan without regard to the consumer's ability to repay the loan. The proposal would implement statutory changes made by the Dodd-Frank Act that expand the scope of the ability-to-repay requirement to cover any consumer credit transaction secured by a dwelling (excluding an open-end credit plan, timeshare plan, reverse mortgage, or temporary loan). In addition, the proposal would establish presumptions of compliance with the ability-to-repay requirement, including by making a "qualified mortgage." The proposal also implements the Dodd-Frank Act's limits on prepayment penalties. Finally, the proposal would require creditors to retain evidence of compliance with this rule for three years after a loan is consummated. Pursuant to the Dodd-Frank Act, the rulemaking authority for the TILA generally transferred from the Board to the CFPB on July 21, 2011. On June 5, 2012, the CFPB issued a notice to reopen the comment period until July 9, 2012, to seek comment on certain new data and information submitted during or obtained after the close of the original comment period. On January 10, 2013,the CFPB issued a final rule (published in the Federal Register on January 30, 2013) implementing amendments to Regulation Z, including the ability-to-repay requirements and "qualified mortgage" provisions. On January 10, 2013, the CFPB also issued a concurrent proposal to seek public comment on certain revisions to the final rule, including certain exemptions from the ability-to-repay requirements and a definition of "qualified mortgage" for certain small creditor portfolio loans (published in the Federal Register on January 30, 2013). The CFPB has issued a final rule (See RIN 3170-AA34). 
Agency: Consumer Financial Protection Bureau(CFPB)  Priority: Other Significant 
RIN Status: Previously published in the Unified Agenda Agenda Stage of Rulemaking: Completed Actions 
Major: Yes  Unfunded Mandates: No 
EO 13771 Designation: uncollected 
CFR Citation: 12 CFR 1026   
Legal Authority: 12 USC 5512    12 USC 1604    15 USC 1639c   
Legal Deadline:
Action Source Description Date
Final  Statutory    01/21/2013 
Action Date FR Cite
NPRM  05/11/2011  76 FR 27390   
NPRM Comment Period End  07/22/2011    
Supplemental Notice to Reopen Comment Period  06/05/2012  77 FR 33120   
Supplemental Notice Comment Period End  07/09/2012 
Final Rule  01/30/2013  78 FR 6408   
Regulatory Flexibility Analysis Required: Yes  Government Levels Affected: None 
Small Entities Affected: Businesses  Federalism: No 
Included in the Regulatory Plan: No 
RIN Data Printed in the FR: Yes 
Related RINs: Related to 7100-AD75, Related to 3170-AA34 
Agency Contact:
Stephen Shin
Office of Regulations
Consumer Financial Protection Bureau
Phone:202 435-7700