FOR IMMEDIATE RELEASE | October 10, 2017

NAFCU Backs CFPB's TRID 'Black Hole' Fix, Cites Relief for Credit Unions


Washington (October 10, 2017) -- National Association of Federally-Insured Credit Unions (NAFCU) Regulatory Affairs Counsel Ann Kossachev today wrotethe Consumer Financial Protection Bureau (CPFB) lending support to the bureau's efforts to resolve the "black hole" issue under its TILA/RESPA integrated mortgage disclosure (TRID) rule, noting the proposed changes will provide "much-needed relief and cost savings to credit unions."

The current TRID rule leads to circumstances where creditors are unable to provide either a revised loan estimate or a corrected closing disclosure to reset tolerances; this situation is commonly referred to as a "gap" or "black hole."

The proposed amendment would allow creditors to compare charges paid by or imposed on a consumer with amounts disclosed on a closing disclosure – rather than a loan estimate – to determine if the estimated closing cost was disclosed in good faith. It would also remove the four-business-day limit for providing closing disclosures but, like the current rule, would permit creditors to reset tolerances by providing a closing disclosure within three business days of receiving information sufficient to validate a reason for revision.

"NAFCU has consistently advocated for an amendment to resolve this issue and is pleased that the CFPB is taking steps to do so through this proposed rule," wrote Kossachev. "NAFCU's member credit unions have complained about this 'black hole' issue because they have been forced to bear the increased cost due to circumstances completely out of their control. These added costs divert valuable, limited resources away from providing more products and services to credit union members."

Additionally, while the CFPB is concerned that some lenders might take advantage of the expanded timeline and provide closing disclosures too far in advance, Kossachev wrote that credit unions would avoid doing so to ensure consumers aren't confused with revisions and unnecessary work isn't created.

For a full text of the letter, please click here.

The National Association of Federally-Insured Credit Unions is the only national trade association focusing exclusively on federal issues affecting the nation's federally-insured credit unions. NAFCU membership is direct and provides credit unions with the best in federal advocacy, education and compliance assistance. For more information on NAFCU, go towww.nafcu.orgor @NAFCUon Twitter.


Jacqueline Ramsay