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CFPB

RIN: 3170-AA37

Publication ID: Fall 2013

Title: Amendments to 2013 Mortgage Rules (Regulations B, X, and Z)
Abstract: In January 2013, the CFPB issued nine final rules implementing numerous provisions of the Equal Credit Opportunity Act, the Real Estate Settlement Procedures Act, and the Truth in Lending Act, as adopted by title XIV of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Since that time, the CFPB has issued a series of proposed and final rules providing clarifying and technical amendments to the January 2013 mortgage rules. On May 29, 2013 the CFPB issued a final rule amending the CFPB's January 2013 ATR final rule, finalizing a proposal issued concurrently with the January rule. Regulation Z generally prohibits a creditor from making a mortgage loan unless the creditor determines that the consumer will have the ability to repay the loan. The final rule provided an exemption to these requirements for creditors with certain designations, loans pursuant to certain programs, certain nonprofit creditors, and mortgage loans made in connection with certain Federal emergency economic stabilization programs. The final rule also provided an additional definition of a qualified mortgage for certain loans made and held in portfolio by small creditors and a temporary definition of a qualified mortgage for balloon loans. Finally, the final rule modified the requirements regarding the inclusion of loan originator compensation in the points and fees calculation. The CFPB's proposed rule issued in April 2013 and finalized in May 2013 amended the CFPB's final rule relating to escrow accounts (under the Truth in Lending Act (Regulation Z)), to clarify how to determine which creditors operating predominantly in "rural or underserved" areas qualify for an exemption from mandatory escrow account requirements and to keep in place certain existing protections for higher-priced mortgage loans (HPMLs) until other similar provisions take effect in January 2014. The CFPB's second proposed rule issued in April 2013 and finalized in July 2013 amended the CFPB's final mortgage rules on mortgage servicing (under Regulation X (Real Estate Settlement Procedures Act), and Regulation Z (Truth in Lending Act)) and on ability to repay and qualified mortgage standards (under Regulation Z). These amendments clarified, corrected, or amended provisions on: (1) the relation to State law of Regulation X's servicing provisions; (2) implementation dates for adjustable-rate mortgage disclosures; (3) exclusions from the repayment ability and prepayment penalty requirements for HPMLs; (4) the small servicer exemption from certain of the new servicing rules; (5) the use of Government-Sponsored Enterprise (GSE) and Federal agency purchase, guarantee or insurance eligibility for determining qualified mortgage (QM) status; and (6) the determination of debt and income for purposes of originating QMs. The CFPB's proposed rule issued and finalized in May 2013 delayed the June 1, 2013 effective date of a prohibition on creditors financing credit insurance premiums in connection with certain consumer credit transactions secured by a dwelling so that the CFPB could take further comment on certain interpretive issues. The prohibition was adopted in the CFPB's final mortgage rule on loan originator compensation requirements (Regulation Z). The CFPB's proposed rule issued in June 2013 and finalized in September 2013 revised provisions on loss mitigation procedures under Regulation X's servicing provisions, amounts counted as loan originator compensation to retailers of manufactured homes and their employees for purposes of applying points and fees thresholds under the Home Ownership and Equity Protection Act and the qualified mortgage rules in Regulation Z, exemptions available to creditors that operate predominantly in "rural or underserved" areas for various purposes under the mortgage regulations, application of the loan originator compensation rules to bank tellers and similar staff, and the prohibition on creditor-financed credit insurance. The CFPB also adjusted the effective dates for certain provisions of the loan originator compensation rules. The CFPB issued an interim final rule in October 2013 to provide clarity regarding servicing requirements when borrowers are in bankruptcy or have sent a "cease communication" request under the Fair Debt Collection Practices Act, and to correct a problem for a small subset of loans with the disclosure to be used for required counseling under the High-Cost Mortgage and Homeownership Counseling Amendments to the Truth in Lending Act (Regulation Z) and Homeownership Counseling Amendments to the Real Estate Settlement Procedures Act (Regulation X) Final Rule (2013 HOEPA Final Rule). The CFPB also issued an interpretive rule in November 2013, to provide data instructions for lenders to use in complying with the requirement under the 2013 HOEPA final rule to provide a homeownership counseling list using data made available by the CFPB or the Department of Housing and Urban Development. The CFPB may issue further proposed amendments and clarifications to the January 2013 mortgage rules prior to their effective dates in January 2014 if warranted.
Agency: Consumer Financial Protection Bureau(CFPB)	Priority: Substantive, Nonsignificant
RIN Status: Previously published in the Unified Agenda	Agenda Stage of Rulemaking: Final Rule Stage
Major: Undetermined	Unfunded Mandates: No
CFR Citation: 12 CFR 1026 12 CFR 1024
Legal Authority: 12 USC 2601 12 USC 2603 to 2605 12 USC 2607 12 USC 2609 12 USC 2617 12 USC 5511 12 USC 5512 12 USC 5532 12 USC 5581 15 USC 1601 et seq

Legal Deadline: None

Timetable:

Action	Date	FR Cite
NPRM (Escrow Rule Amendments)	04/18/2013	78 FR 23171
NPRM Comment Period End (Escrow)	05/03/2013
Final Rule (Escrow)	05/23/2013	78 FR 30739
NPRM (Servicing and ATR/QM Rule Amendments)	05/02/2013	78 FR 25638
NPRM Comment Period End (Servicing and ATR/QM)	06/03/2013
NPRM (Loan Originator Delay - Credit Insurance)	05/10/2013	78 FR 27308
NPRM Comment Period End (Loan Originator - Credit Insurance)	05/25/2013
Final Rule (Loan Originator - Credit Insurance)	05/31/2013	78 FR 32547
NPRM (Servicing and Points and Fees Amendments)	07/02/2013	78 FR 39901
Final Rule (Servicing and ATR/QM)	07/24/2013	78 FR 44685
NPRM Comment Period End (Servicing and Points and Fees Amendments)	07/22/2013
Final Rule (Servicing and Points and Fees Amendments)	10/01/2013	78 FR 60381
Interim Final Rule (Amendments to 2013 HOEPA Final Rule and 2013 Mortgage Servicing Rules)	10/23/2013	78 FR 62993
Final Rule (Interpretive Rule - Housing Counseling Requirements Under 2013 HOEPA Final Rule)	11/00/2013

Regulatory Flexibility Analysis Required: No	Government Levels Affected: None
Federalism: No
Included in the Regulatory Plan: No
RIN Data Printed in the FR: No
Related RINs: Related to 3170-AA16, Related to 3170-AA17, Related to 3170-AA14, Related to 3170-AA13
Agency Contact: Paul Mondor Office of Regulations Consumer Financial Protection Bureau Phone:202 435-7700