Compliance Blog

Written by Alicia Nealon, Regulatory Compliance Counsel

Well it’s Monday and we all know what that means for compliance professionals- it’s time to sit down and write our “to-do” lists for the week (or for the uber-efficient among us, time to start tackling some of those tasks). If I had to guess, complying with the CFPB’s new mortgage requirements has been a high priority on many of our lists. And while many are still trying to get their ducks in a row so they can check something off their list, even more items keep making their way on to the ever-growing list.  

For those that are delving into their lists today, I wanted to make mention of the CFPB’s recently-released educational brochures in case you missed them. We’ve received some questions or concerns regarding these brochures and thought we’d remove researching these questions from everyone’s “to-do” lists by providing clarity to the concerns that have been brought to our attention.

In January, the CFPB updated the educational brochures that lenders are required to provide consumers at the time of certain loan applications. Specifically,

• Regulation X requires credit unions to give members applying for mortgages a special information booklet entitled “Shopping for Your Home Loan: Settlement Cost Booklet” within 3 business days after receiving the application;
• Regulation Z requires credit unions to provide members applying for an adjustable rate mortgage with the booklet titled “Consumer Handbook on Adjustable-Rate Mortgages (CHARM) Booklet,” or a suitable substitute; and 
• Regulation Z also requires members getting a home equity line of credit receive the home equity brochure entitled “What You Should Know about Home Equity Lines of Credit (HELOC) Brochure” or a suitable substitute.

 There have been some cost-concerns regarding whether these updated brochures mean credit unions cannot use older versions of required educational materials that they have already paid to have printed. Fortunately, there is some good news this Monday morning. When the CFPB published the updated brochures in the Federal Register, it advised that lenders may use earlier versions until existing supplies are exhausted.  Specifically, the CFPB wrote:

“Those who provide these publications may, at their option, immediately begin using the revised HELOC Brochure, CHARM Booklet, or Settlement Cost Booklet, or suitable substitutes to comply with the requirements in Regulations X and Z. The Bureau understands, however, that some may wish to use their existing stock of publications. Therefore, those who provide these publications may use earlier versions of these publications until existing supplies are exhausted.”

However, for those credit unions that have just been printing brochures from the HUD website on an “as needed” basis, the CFPB requires that you start printing from its website instead.

While these updated brochures provide helpful materials, many of us are still left with just one more thing to add to the list – another change to the already voluminous number of regulatory changes that are affecting the industry. With regulators rolling out so many changes in such a short period of time, you really have to ask yourself: when will enough be enough?

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Webcast:  Looking for help to understanding the new mortgage requirements? Check out our upcoming webcast-  TILA/RESPA Series Part 1 – An Overview. Don’t start preparing at the last second for new regulations requiring you to combine your TILA and RESPA disclosures. Register by Feb. 19 to save $100 and learn the details you need.