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Proposed Clarifications to Ability to Repay/QM and Mortgage Servicing

On Friday April 12th the CFPB issued proposed clarifications to the escrow rule.  Last friday, they issued proposed clarifications to the Ability to Repay / QM Rule and the Mortgage Servicing Rule.   

You are probably thinking “oh no!  It’s the remittance transfer rule all over again!  Why can’t they get it right the first time!”  Given how many times the CFPB revisited the remittance transfer rule, such thoughts are certainly warranted.  On the first read, however, the ‘clarifications’ issued on the escrow, ability to repay, and mortgage servicing rules appear to actually be clarifications, and not substantive changes to the rule.  In my mind, the more commentary and explanatory examples the better.  Furthermore, after a rule is issued, and even after the rule is effective, there is no reason to cease providing such commentary as issues not currently addressed in the commentary arise.  Thus far, the CFPB seems to share these thoughts.  In following the CFPB’s rulemaking process, you should pay attention not only to the actual rule and guidance, but also to the CFPB’s approach.  The CFPB is very different from other regulators.  By noting how they handle these rule-makings you can better plan the implementation of future rulemakings. 

If you want a summary of the CFPB’s ‘clarifications’ click on the links provided above.  Those links will also take you to the actual proposal.  If you want to comment on the proposals, keep in mind that the comment period is very short – 15 days for the escrow rule and 30 days for the ATR and Servicing – so plan accordingly.

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