Spring 2019 rulemaking agenda
May 22, 2019 / Source: CFPB
Spring 2019 rulemaking agenda
By Diane Thompson –
The Bureau is publishing its Spring 2019 Agenda as part of the Spring 2019 Unified Agenda of Federal Regulatory and Deregulatory Actions, which is coordinated by the Office of Management and Budget. As an independent regulatory agency, the Bureau voluntarily participates in the Unified Agenda. The agenda lists the regulatory matters that the Bureau reasonably anticipates having under consideration during the period from May 1, 2019, to April 30, 2020, as described further below
A permanent director of the Bureau took office in December 2018. The Director recently completed a listening tour to engage with Bureau stakeholders, employees, and outside experts, building on feedback submitted through more than 88,000 public comments in response to the Bureau’s 2018 “Call for Evidence” initiative. The Bureau expects to communicate further information about future planning and priorities in the coming months. In the meantime, this Spring 2019 Agenda reflects ongoing rulemaking activities, including initiatives to implement statutory requirements and to address the potential sunset of statutory and regulatory provisions.
Implementing Statutory Directives
The Bureau is engaged in a number of rulemakings to implement directives mandated in the Economic Growth, Regulatory Relief, and Consumer Protection Act of 2018 (EGRRCPA) the Dodd-Frank Act, and other statutes. As part of these rulemakings, the Bureau is working to achieve the consumer protection objectives of the statutes while minimizing regulatory burden on financial services providers, including facilitating industry compliance with rules.
For example, the Bureau has recently published an Advance Notice of Proposed Rulemaking to seek public comment relating to implementation of section 307 of EGRRCPA, which amends the Truth in Lending Act (TILA) to mandate that the Bureau prescribe certain regulations relating to “Property Assessed Clean Energy” (PACE) financing. The required regulations must carry out the purposes of TILA’s ability-to-repay (ATR) requirements, currently in place for residential mortgage loans, with respect to PACE financing, and apply TILA’s general civil liability provision for violations of the ATR requirements the Bureau will prescribe for PACE financing.
The Bureau recently issued a Notice of Proposed Rulemaking to follow up on an interpretive and procedural rule that it issued in August 2018 to provide clarification regarding EGRRCPA amendments to the Home Mortgage Disclosure Act (HMDA) which created partial exemptions that allow certain insured depository institutions and insured credit unions not to report certain data points for certain transactions.
The Bureau has been engaged in a range of other activities to support implementation of EGRRCPA. For example, the Bureau updated its small entity compliance guides and other compliance aids to reflect EGRRCPA’s statutory changes. The Bureau also has issued written guidance as encouraged by section 109 of the Act to facilitate compliance with certain regulations governing mortgage disclosures. In anticipation of its future rulemaking activity, the Bureau has conducted a preliminary analysis of the number of lenders potentially impacted by implementation of section 108 of EGRRCPA. That preliminary analysis indicates that the section 108 EGRRCPA amendments would affect no more than a few hundred institutions. The Bureau anticipates updating that analysis in conjunction with its release of its HMDA data point article, which it intends to issue later this summer.
Consistent with undertaking rulemaking to implement the EGRRCPA, the Bureau intends to recommence work later this year to develop rules to implement section 1071 of the Dodd-Frank Act. Section 1071 amended the Equal Credit Opportunity Act (ECOA) to require financial institutions to collect, report, and make public certain information concerning credit applications made by women-owned, minority-owned, and small businesses. The Bureau expects that it will be able to resume pre-rulemaking activities on the section 1071 project within this next year.
Continuation of Other Rulemakings
The Bureau is continuing certain other rulemakings described in its Fall 2018 Agenda to ensure that markets for consumer financial products and services operate transparently and efficiently and to address potential unwarranted regulatory burdens.
For example, the Bureau issued two proposals in February 2019 relating to reconsideration of a 2017 rule titled Payday, Vehicle Title, and Certain High-Cost Installment Loans. The main proposal would rescind portions of the 2017 rule that mandated underwriting requirements for certain short-term and balloon-payment loans. The second proposalwould postpone the compliance date for those same provisions for fifteen months. The Bureau expects to issue a final rule concerning the compliance date in summer 2019 and a final determination on reconsideration thereafter.
In addition, prior to the enactment of the EGRRCPA, the Bureau in August 2017 had temporarily increased the threshold for collecting and reporting HMDA data with respect to open-end lines of credit from 100 loans to 500 loans so that the Bureau could assess whether to make a permanent adjustment to the 100 open-end line of credit threshold. The Bureau recently issued a Notice of Proposed Rulemaking to address both the open-end threshold and the 2015 HMDA rule’s 25-loan threshold for closed-end loans, as well as implementation of the EGRRCPA’s changes to HMDA as described above. The Bureau concurrently issued an Advance Notice of Proposed Rulemaking concerning certain data points that are reported under the 2015 HMDA rule. The Bureau expects at a later date to issue a Notice of Proposed Rulemaking concerning the public disclosure of HMDA data in light of consumer privacy interests.
Finally, the Bureau issued a Notice of Proposed Rulemaking in May 2019 addressing such issues as communication practices and consumer disclosures in the debt collection market. This proposal builds on research and pre-rulemaking activities regarding the debt collection market, which remains a top source of complaints to the Bureau.
New Projects and Further Planning
After completing an assessment in October 2018 of its rules to implement Dodd-Frank Act requirements for international remittance transfers, the Bureau issued in April 2019 a request for information to gather information related to the expiration of a statutorily-established exception in the Remittance Rule that permits insured banks and insured credit unions to estimate certain required disclosures and other potential remittance transfer issues and related topics. The Bureau may consider rulemaking based on comments received to that RFI.
The Bureau also recently completed an assessment of rules implementing Dodd-Frank Act provisions that require mortgage lenders to determine consumers’ ability to repay loans and define certain “qualified mortgages” that are presumed to comply with the statutory requirements. The Bureau is now focusing its attention on a regulatory provision (the patch) that extends qualified mortgage status to loans that are eligible to be purchased or guaranteed by either Fannie Mae or Freddie Mac (the government sponsored entities or GSEs) while they operate under Federal conservatorship or receivership. After further policy analysis on this issue, the Bureau will determine whether rulemaking or follow up activity is appropriate concerning the patch or other aspects of the ATR/QM rules.
The Bureau is also actively reviewing existing regulations. For example, the Bureau will be conducting an assessment pursuant to section 1022(d) of the Dodd-Frank Act of its regulations to consolidate various mortgage origination disclosures under the Truth in Lending Act and Real Estate Settlement Procedures Act. The Bureau also published in May 2019 its plan for conducting reviews consistent with section 610 of the Regulatory Flexibility Act, of certain regulations which are believed to have a significant impact on a substantial number of small entities, and it issued a request for information on the first such review, concerning the impact of certain regulations concerning overdraft services on small banks and credit unions.
As noted above, Bureau leadership is considering further prioritization and planning of the Bureau’s rulemaking activities, both with regard to substantive projects and modifications to the processes that the Bureau uses to develop and review regulations. While this evaluation is underway, the Bureau has decided not to revise its current list of long-term projects other than the changes described above.
The Bureau expects by no later than the Fall 2019 Agenda to issue a more comprehensive statement of priorities to reflect its ongoing statutorily mandated market monitoring and the Bureau’s other activities discussed above.