In remarks yesterday at the Mortgage Bankers Association’s annual convention, CFPB Director Richard Cordray stated that the CFPB may need to look more closely at vendors of software and other tools used by lenders to comply with the TILA-RESPA Integrated Disclosure (TRID) rule which became effective on October 3.
Director Cordray stated that he was “disturbed” by reports that such vendors were creating obstacles for lenders attempting to comply with the TRID rule. He indicated that not only the CFPB but all of the financial regulators might “need to devote greater attention to the unsatisfactory performance of these vendors and how they are affecting the financial marketplace.” Director Cordray’s remarks suggest that the CFPB may be questioning whether various vendors are qualified to provide the services they offer and is preparing to use its supervisory and enforcement authority as to “servicer providers” to take a closer look. (Under Dodd-Frank, the CFPB can examine “service providers” to entities that it supervises.)
Director Cordray also downplayed concerns expressed by lenders that the TRID rule is hurting business because of the need to delay closings when changes occur to provide new disclosures. It appears the Director does not fully appreciate that the concerns expressed by lenders largely do not involve the limited situations that require a revised Closing Disclosure with a new waiting period. Rather, lenders mainly are concerned (1) with last minute changes that can delay the delivery of the initial Closing Disclosure, which can delay a closing, and (2) that depending on the circumstances, they may not be able to reset the tolerances with a Closing Disclosure.