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Entries in TILA (4)

Monday
Dec072015

Top 5 Priorities of Maine Banking Industry for 2016

In a November 2015 interview with MaineBiz news magazine, Maine Bankers Association President Chris Pinkham listed the top five issues that he believed were priorities for Maine’s banking industry.  His list includes, in order:

  1. Addressing cybersecurity and fraud issues with the EMV chip.  Pinkham cautioned that chip technology is encrypted, but transactions on the Internet remain at risk.  He also noted that customers still needed to check their statements; merchants needed to install the right equipment; and card manufacturers needed to “beef up” production to get the cards out there.
  2. The growth of residential mortgage closing documents as a result of the integration of Truth in Lending and Real Estate Settlement Procedures Act disclosures. Pinkham noted that the closing package had grown from 105 pages to 120 pages as a result.
  3. Regulatory relief was needed for small banks that are less complex. Pinkham also suggested ways to reduce the frequency with which privacy notices are sent to customers.
  4. Encouraging more partnerships between banks and the community, including efforts to reduce elder financial fraud.  Pinkham pointed to a new “Senior Safe” program that had trained 125 tellers to better identify instances of fraud, and an 800-number to report.
  5. Addressing student loan debt.  The weight of student loan debt is hurting families, and he encouraged policies that allowed for the consolidation of student debt or other incentives for Maine graduates to stay and work in Maine.

The full article from MaineBiz, published November 30, 2015, can be found here.

Monday
Jul062015

FDIC issues TRID Exam Procedures: Integrating TILA and RESPA

On June 30th of this year, the FDIC issued guidelines for banks related to compliance examination procedures for Truth-in-Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA).  The Integrated Disclosure Rule for the two acts is commonly referred to as “TRID."  

The TRID rules were issued by the Consumer Financial Protection Bureau (CRPB) in late 2013, and further revised in February of this year.  The rules are slated to go into effect on August 1, although the CFPB is currently taking comments on delaying the effective date to October 3, 2015.  The comment period closes on July 7.

Briefly, the TRID rules sought to integrate the RESPA and TILA disclosures for certain closed-end mortgages, excluding certain loans such as reverse mortgages, home equity lines of credit, and mobile home loans.  The new rules also modified the timing of disclosures and revised the definition of “application” triggering the disclosure requirements.  The new definition is a 6-factor test requiring the following information from the consumer:  name, income, social security number, property address, estimated value of property, and loan amount sought. 

To assist banks with compliance, the CFPB developed a comprehensive set of online resources for TILA-RESPA Integrated Disclosure Rule implementation, which is available here.  The resources include a compliance guide, a guideline to forms, a closing factsheet, a disclosure timeline, and sample disclosure forms. 

Thenew examination procedures also addressed changes to the following rules: 

  • Higher Priced Mortgage Loan Appraisal Rule, which exemps certain transactions from appraisal requirements;
  • Mortgage Servicing Rules, which modified the definition of “small servicer” to include nonprofit entities servicing fewer than 5000 mortgages;and
  • Ability to Repay/Qualified Mortgage Rule, which added a “cure provision” allowing creditors or assignees a set amount of time to refund to the consumer excess points, fees, or interest on either as necessary to allow the mortgage to maintain Qualified Mortgage (QM) status.

The examination guidelines were issued as part of Financial Institution Letter FIL-27-2015, which can be found here

Wednesday
Oct162013

Maine AchievesTruth-in-Lending Harmony, Adopts Regulation Z-3

Maine financial regulators have now finalized Regulation Z-3 in order to harmonize the State’s Truth-in-Lending rules with recently adopted changes approved by the Consumer Financial Protection Bureau.

The joint rulemaking was issued October 15, 2013 by Maine’s Bureau of Financial Institutions (Chapter 138) and Maine’s Bureau of Consumer Credit Protection (Chapter 240).

Under the new rules, federal Regulation Z (12 CFR Part 1026) and Regulation M (12 CFR Part 1013) are conformed to Maine law.  The new rule also includes changes to both rules that were adopted on September 13th of this year by the CPFB.

The original notice of rulemaking was issued on August 20, 2013 as reported in Banking Law Update

Regulation Z-3 became effective on October 15, 2013.

Thursday
Dec012011

Maine Regulation Z-2 Officially Repealed

Regulation Z-2 is now officially repealed in Maine. On December 1, 2011, the Maine Bureau of Consumer Credit Protection and Bureau of Financial Institutions jointly announced the conclusion of their rulemaking regarding Regulation Z-2, which was slated for repeal based on recent amendments to Maine’s Consumer Credit Code earlier this year.

Click to read more ...