For months now, the lending and settlement services industry has been asking the Consumer Financial Protection Bureau (CFPB) to declare a grace period on enforcement of the new Integrated Disclosure rule in the months after it first takes effect. On June 17, the industry finally heard something a bit more concrete from the CFPB on the subject of a potential delay in the rule's effective date. CFPB Director Richard Cordray announced the bureau was proposing a two-month delay in the effective date, subject to public comments. This announcement came after much fuzzy guidance in the form of CFPB blog posts and letters to Congress.
In a June 3 blog post addressing what CFPB calls its Know Before You Owe rules, the bureau delivered not a grace period on enforcement, but reassuring words that said CFPB "will be sensitive to the progress made by those entities that have been squarely focused on making good-faith efforts to come into compliance with the rule on time."
The rule implements changes to the Truth in Lending Act-Real Estate Settlement Procedures Act Integrated Disclosure requirements (TRID). The TRID rule was first published in November 2013, and lenders and settlement agents have been struggling with implementation plans ever since.
The same day as the blog post, CFPB Director Richard Cordray sent letters to members of Congress who had written to CFPB seeking a grace period for enforcement of TRID until year-end 2015. The separate, bipartisan letters were signed by 41 senators on the Senate side, and 255 members of the House. In his response, Cordray did not grant any specified grace period.
Instead, Cordray's letter states: "I have spoken with our fellow regulators to clarify that our oversight of the implementation of the rule will be sensitive to the progress made by those entities I that have squarely focused on making good-faith efforts to come into compliance with the rule on time."
Cordray adds in his letter, "My statement here of this approach is intended to ease some of the concerns we have heard about this transition to new processes in the coming months, and is consistent with the approach we took to implementation of the Title XIV mortgage rules in the early months after the effective dates in January 2014...