CFPB Finalizes Modifications to Mortgage Rules: Changes Resolve Implementation Issues and Clear the Way for Better Consumer Protections
the Consumer Financial Protection Bureau (CFPB) finalized amendments and clarifications to its January 2013 mortgage rules in order to help industry comply and to better protect consumers. The changes made today answer questions that have been identified during the implementation process.
The CFPB finalized several mortgage rules in January 2013. Among these rules, the Ability-to-Repay rule protects consumers from irresponsible mortgage lending by requiring that lenders generally make a reasonable, good-faith determination that prospective borrowers have the ability to repay their loans. The mortgage servicing rules establish strong protections for homeowners facing foreclosure, and the loan originator compensation rules address certain practices that incentivized steering borrowers into risky or high-cost loans.
The CFPB also finalized rules that strengthened consumer protections for high-cost mortgages, and instituted a requirement that escrow accounts be established for a minimum of five years for certain higher-priced mortgage loans.