The Consumer Financial Protection Bureau (CFPB) has issued a proposed rule designed to clarify the escrows final rule issued by the agency in January.
According to the CFPB, the proposal would amend an existing rule that provides ‘protections regarding assessments of consumers' ability to repay and prepayment penalties on certain "higher-priced' mortgage loans.’ The agency is seeking clarification of this aspect because it believes the existing rule ‘can be read to cut off the old protections before the new expanded protections take effect.’ As a result, the CFPB says this would ‘create a six-month period when those consumer protections would not apply.’
The CFPB is also proposing to clarify how a county would be considered ‘rural’ or ‘underserved’ for purposes of applying an exemption in the escrows rule, as well as in special provisions within the Dodd-Frank Act.
Separately, the CFPB has announced that it is issuing another proposal to address questions regarding qualified mortgages (QMs) and servicing standards, which were the subject of rules issued in January. These proposals seek to clarify five considerations: the debt-to-income ratio; contract variances and the temporary QM provision; purchase, guarantee or insurability status and the temporary QM; Regulation X's impact on state-based mortgage servicing regulation; and the small servicer exemption.