In an April 28, 2016, letter to mortgage industry trade groups,1 the Director of the Consumer Financial Protection Bureau (“CFPB”), Richard Cordray, signaled that the agency plans to propose amendments to the TILA-RESPA Integrated Disclosure (“TRID”) rule, also known as the “Know Before You Owe” rule, this July.
“We recognize the implementation of the Know Before You Owe rule poses many operational challenges,” Director Cordray wrote, and “[w]e do recognize that incorporating some of the Bureau’s existing informal guidance, whether provided through webinar, compliance guide, or otherwise, into the regulation text and commentary would be helpful.” The letter continued, “We also believe that there are places in the regulation text and commentary where adjustments would be useful for greater certainty and clarity.” The letter goes on to announce that, to address these concerns, the CFPB plans to publish a notice of proposed rulemaking (“NPR”) on the TRID rule in late July.
The industry generally is positive about the announcement, because the CFPB’s guidance on the TRID rule to date (other than the original December 31, 2013, Federal Register issuance) has been presented as non-binding and informal. For example, since it released the TRID rule at the end of 2013, the CFPB has published and updated several user guides on the rule, including a small entity compliance guide, a real estate professionals’ guide, and a guide to the forms. The CFPB also has hosted (and published materials from) seven separate webinars during which CFPB legal and policy staff answered pre-selected TRID implementation questions. Each of these publications and presentations has included conspicuous disclaimers stating that their content is not binding on the CFPB. Despite numerous calls from market participants and lawmakers to resolve specific ambiguities in, and to alleviate unintended consequences of, the TRID rule, the CFPB declined to propose substantive amendments to the rule – until now.
Importantly, the letter sets out anticipated timeframes. The CFPB plans to meet with representatives of the industry trade associations by late May or early June, in advance of issuing the NPR. The letter also suggests a brief comment period, which would allow the CFPB to adopt a final, amendatory rule relatively promptly.