Compliance Blog

Posted by Anthony Demangone

Just when I thought I was out, they pull me back in. - Michael Corleone, Godfather III. 

As I looked at my calendar, I saw a nice window of relaxation.  The Credit CARD Act madness was about to simmer down, and there was not a major regulatory migraine on the horizon.  Then I checked my e-mail.

Yesterday, the Fed dropped a number of major rulemakings that address mortgage-related compliance issues.  Below, I have a number of bullet points that describe the different rulemakings.  I had thoughts about providing short descriptions of each rule, but then this post would be almost too long to read. Your homework assignment is to click on each link and, at least, read the Fed's description of the rule in question.  Some are proposals, and some are final rules.  We'll get into the details in future blog entries. NAFCU Members: we are working on Regulatory Alerts and Final Regulations for these rulemakings.  For now, here's what they did:

• They issued a new set of proposed changes (930 pages) to Reg Z to enhance consumer protections for closed end mortgages, reverse mortgages and HELOCs. We'll have 90 days to comment once the proposal hits the Federal Register
• They issued an interim final rule (71 pages) to amend Reg Z to implement MDIA provisions.  The rule will require credit unions to disclose how the mortgage payment can change over time.  We'll need to comply with this for applications received on or after January 30, 2011.
• The Fed announced a final rule (63 pages) concerning mortgage sale and transfer notifications.   The Fed has issued interim final rules in this area back in November 2009.  Credit unions can follow the interim final rule guidance until this compliance deadline kicks in - which will be January 1, 2011.
• The Fed also issued a final rule (113 pages) to address mortgage loan originator compensation.   This deadline goes into effect April 1, 2011.
• The Fed also issued a proposal (16 pages) to revise escrow requirements for higher-priced, first-lien "jumbo" mortgage loans. We'll  have 30 days to comment once this hits the Federal Register.

That's 1,193 pages of regulatory text to sift through.  Happy sifting, everyone.