CFPB Delays Mortgage Disclosures Due to 'Administrative Error'
The CFPB gave little ground in its pledge Wednesday to be "sensitive" to lenders that make a "good-faith effort" to comply with new mortgage disclosure rules that go into effect in August. The agency's statements fell short of a formal grace period that the industry and lawmakers had been demanding.
Hundreds of lawmakers from both sides of the political aisle are pushing for the Consumer Financial Protection Bureau to grant a grace period for banks, credit unions and other lenders to comply with a new mortgage disclosure rule.
WASHINGTON After months of declining industry and congressional pleas to delay an impending rule combining two mortgage disclosure regimes, the Consumer Financial Protection Bureau on Wednesday announced a two-month delay due to an "administrative error."
The CFPB released a statement from Director Richard Cordray saying the agency would issue a "proposed amendment" delaying the effective date to Oct. 1.
The rule, which would create an "integrated disclosure" combining requirements of the Truth in Lending Act and the Real Estate Settlement Procedures Act, is commonly known as TRID.
Although trade groups and nearly 300 members of Congress had pushed for the CFPB to delay the rule or offer a grace period for companies that simply make an effort to be in compliance, the CFPB said it decided to push the date back because of other reasons.
"We made this decision to correct an administrative error that we just discovered in meeting the requirements under federal law, which would have delayed the effective date of the rule by two weeks," Cordray said in the press release. "We further believe that the additional time included in the proposed effective date would better accommodate the interests of the many consumers and providers whose families will be busy with the transition to the new school year at that time."
The proposal will be issued for public comment and "a final decision is expected shortly thereafter," the CFPB said.