Spring 2021 CFPB Rulemaking Agenda
On June 11, the regulators released their Spring 2021 Rulemaking Agendas, which helps inform what the agencies are planning to review and finalize in 2021. The Consumer Finance Protection Bureau (CFPB) also released a blog, providing more detail on what regulations were included and excluded from the Bureau’s rulemaking agenda. The blog explains that the spring agenda pursues updates to the regulations decided upon by the interim leadership, and the Fall 2021 Agenda will reflect items determined by the new permanent director. This blog will provide a summary of the CFPB’s Spring 2021 Agenda and provide resources regarding these rules.
Qualified Mortgages (QM)
In December, the CFPB finalized two final qualified mortgage (QM) rules, as discussed in our blogs: CFPB Amends Qualified Mortgage Rule, Part I: Shift from the Debt-to-Income Ratio and CFPB Amends Qualified Mortgage Rule, Part II: Tis the Season for Seasoned QM! However, in March the agency released a proposed rule, which was finalized in April, to extend the mandatory compliance date to October 1, 2022, as explained in our blog, Delay of Price-Based General QM Mandatory Compliance Date. The CFPB explains the extension will “allow creditors a wider range of options in making mortgage loans that are QMs and thereby obtain certain protections from both creditor and assignee liability.”
In April, the CFPB issued a proposed rule, seeking comments on the mortgage servicing early intervention and loss mitigation-related provisions in Regulation X, “to help ensure that borrowers impacted by the COVID-19 pandemic have an opportunity to be evaluated for loss mitigation before the initiation of foreclosure.” The comment period ended in May, and the Bureau is expected to issue a final rule before June 30, which is the expiration of the federal foreclosure moratoria. For more information on the proposed rule, visit our blog Mortgage Servicing Proposed Rule.
Automated Valuation Models (AVMs)
The Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA) requires agencies to implement regulations for creating quality control standards for AVMs. This interagency rulemaking set to be released by the end of the year jointly with the NCUA and FHFA, intends to ensure confidence in AVM estimates by protecting against manipulation of data and conflicts of interests. Aligned with this rulemaking, the CFPB is hosting a Virtual Home Appraisal Bias Event with the FFIEC and NCUA to “explore how racial bias in housing appraisals and automated valuation models may occur and what steps can be taken in response.”
With LIBOR set to sunset the end of 2021, in June 2020, the CFPB issued a proposed rulemaking to address “open-end provisions restricting index changes, requiring change-in-terms notices, and addressing how credit card rate reevaluation requirements apply.” The NCUA has encouraged credit unions to complete the transition before December 2021. However, the CFPB stated the final rule is set to be published in January 2022. Our blog, CFPB Issues Resources on LIBOR Transition provides information about the proposed rule and CFPB resources to aid in the LIBOR transition.
The CFPB has state in its blog that the two HMDA proposed rules that were in previous rulemaking agendas have been removed, and the CFPB will instead conduct their 5-year assessment of HMDA.
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