The Consumer Financial Protection Bureau on Thursday released a second update to its exam procedures to offer guidance to the industry regarding what it will look for in examinations following the issuance of new mortgage regulations in January 2013.
“We are committed to transparency around our examination process,” said CFPB Director Richard Cordray in a statement. “So we have worked hard to provide industry with advance notice of what we will be expecting. That, in turn, will improve compliance and benefit consumers. ”
Thursday’s updates relate to several new regulations the CFPB issued in January, many of which stemmed from the Dodd-Frank Act and cover various stages of the consumer mortgage experience.
Updates to the mortgage exam procedures cover the Ability-to-Repay/Qualified mortgages; high cost mortgages; appraisals for higher-priced mortgage loans; and new amendments related to the escrows rule, along with recent changes to credit card rules. Exam procedures now cover the CFPB’s mortgage origination rules issued through May 29, 2013, and mortgage servicing rules issued through July 10, 2013.
The new rules issued at the beginning of this year go into effect in January 2014. The CFPB’s Thursday release of exam procedures are meant to help mortgage companies understand and prepare for how they will be examined for the bureau’s rules that require lenders to evaluate a borrower’s ability to repay and services to provide monthly statements and disclosures, among others.
Written by Alyssa Gerace