As we reported previously, on July 7, 2017 the Consumer Financial Protection Bureau (CFPB) posted on its website long awaited amendments to the TILA/RESPA Integrated Disclosure (TRID) rule, and a proposal to address the so-called “black hole” issue (regarding limits on the ability of a credit to reset tolerances with a Closing Disclosure).

Both the amendments and the proposal were published in Federal Register on August 11, 2017.  As a result, the amendments become effective on October 10, 2017, with a mandatory compliance date of October 1, 2018, and the comment deadline for the proposal is also October 10, 2017.

On October 7, 2015, the U.S. House of Representatives passed a bill that would provide a safe harbor from the new TILA/RESPA Integrated Disclosure (TRID) rule for a period of five months. By a vote of 303 to 121 the House passed the “Homebuyers Assistance Act” (H.R. 3192), which would provide a hold harmless period until February 1, 2016 for good-faith efforts to comply with the TRID rule, which went into effect October 3, 2015. The CFPB had previously delayed the effective date of the TRID rule from August 1, 2015 until October 3. The CFPB declined to adopt a formal hold harmless period despite industry requests for such a period based on the considerable difficulty of implementing the TRID rule, which was compounded by the lack of formal guidance on compliance issues posed by the rule. However, the CFPB has indicated it would take into account good-faith efforts to comply with the new requirements. The bill now heads to the Senate where its prospects remain unclear. The House passed the bill by a substantial bipartisan majority, despite a White House threat that it would veto any hold harmless bill.

The CFPB has updated the TILA-RESPA implementation materials and resources to make them consistent with the new October 3 effective date for the TILA-RESPA final rule. Specifically, updates have been made to the TILA-RESPA Integrated Disclosures Guide to the Loan Estimate and Closing Disclosure forms, the TILA-RESPA Integrated Disclosure Small Entity Compliance Guide, and the TILA-RESPA Integrated Disclosures timeline example. The TILA-RESPA implementation materials may be found on the CFPB’s website here.

The CFPB has issued a final rule postponing the effective date for all provisions of the TILA-RESPA Final Rule and Amendments to October 3, 2015.  The final rule also includes certain technical amendments to reflect the new effective date.  The provisions of the final rule related to the delay in the effective date, are effective immediately upon publication in the Federal Register in order to move the effective date for TILA-RESPA Final Rule and Amendments from Saturday, August 1, 2015 to Saturday, October 3, 2015.  The Federal Register that contains the finalized rule is scheduled to be published on July 24, 2015.

The final rule also makes two technical changes to the TILA-RESPA Final Rule that were not in the proposed rule.  Specifically, the final rule amends § 1026.38(i)(8)(ii) and (iii)(A) to include, in the amount disclosed as “Final” for Adjustments and Other Credits, the amount disclosed under § 1026.38(j)(1)(iii) for certain personal property sales in order to conform the calculation of Adjustments and Other Credits on the Closing Disclosure and Loan Estimate.  The final rule also attempts to conform the disclosure of the borrower’s cash to close in the Calculating Cash to Close and the Summaries of Transactions tables on the Closing Disclosure by amending § 1026.38(j)(1)(iv) to include, in the amount disclosed as Closing Costs Paid at Closing, lender credits disclosed under § 1026.38(h)(3).  According to the preamble, these “technical corrections are in line with existing industry expectations and informal Bureau guidance.”

As we previously reported, due to an administrative error the CFPB committed under the Congressional Review Act, the TILA-RESPA Final Rule would have been delayed by two weeks until August 15, 2015.  According to Director Cordray, the CFPB believes that the additional time provided by the new October 3, 2015 effective date will “better accommodate the interests of the many consumers and providers whose families will be busy with the transition to the new school year.”  In addition, the preamble also notes that the CFPB noticed “delays in the delivery of system had left some creditors with limited time to fully test all of their systems and system components to ensure that each system works with the others in an effective manner.”

Finally, the preamble to the final rule repeats the CFPB’s vow that it will not institute either a formal grace period or a dual compliance period as requested by many in the industry and Congress. However, the preamble states that, as expressed in Director Cordray’s letter to members of Congress on June 3, 2015, the CFPB’s “oversight of the implementation of the Rule will be sensitive to the progress made by those entities that have squarely focused on making good-faith efforts to come into compliance with the rule on time.”

The CFPB has posted a video of its May 26th webinar that addressed questions about the final TILA-RESPA Integrated Disclosure Rule. The webinar was the fifth in a series to address specific questions related to rule interpretation and implementation challenges that have been raised by creditors, mortgage brokers, settlement agents software developers, and other industry stakeholders. Although currently the rule is scheduled to become effective for applications received by creditors or mortgage brokers on or after August 1, 205, the CFPB has proposed to delay the effective date until October 3, 2015.

A detailed discussion of the webinar prepared by Rich Andreano, a member of Ballard Spahr’s Mortgage Banking Group, can be found here.

The CFPB has issued its formal proposal to delay the effective date of the TILA-RESPA Integrated Disclosures (TRID) rule until Saturday, October 3, 2015.  The new effective date comes only a week after the CFPB announced it would delay the effective date until October 1, 2015 due to an administrative error that was made in the rules disclosure and review process.  Specifically, under the Congressional Review Act, Congress and the Government Accountability Office must receive any new rule at least 60 days prior to the rule taking effect.  However, the CFPB failed to submit its notice until after the 60 day deadline had passed and was forced to delay the effective date of the TRID rule as a result.

Although based on when the CFPB completed the required filing, the effective date of the TRID rule would have been delayed until August 15, 2015, the CFPB decided to propose a longer delay.  In the CFPB’s press release, the agency says it believes pushing back the effective date to the first Saturday of October “may facilitate implementation by giving industry time over the weekend to launch new systems configurations and to test systems.”  The Saturday launch date is also consistent with original industry plans to transition to the new TRID rule on Saturday, August 1, 2015.  According to the CFPB, “moving the effective date may benefit both industry and consumers with a smoother transition to the new rules.”  As we noted previously, concerns with the finalization of the necessary software to comply with the TRID rule may have been a factor in the CFPB’s decision.

The proposal will be published in the Federal Register on June 26, and comments are due by July 7.