The Credit Union National Association (CUNA) has asked the Federal Reserve Board to withdraw its interim final rule revising Regulation Z mortgage loan disclosure requirements ‘as soon as possible,’ adding that the Fed should ‘impose a general moratorium on the overall Regulation Z rulemaking process that is currently in progress.’
In a comment letter to the board, CUNA warned that the new disclosures ‘will impose significant burdens on credit unions that will serve only to confuse consumers, without any corresponding benefits.’
The credit union trade group also noted that these disclosures will create problems during the implementation of the Dodd-Frank Act, when the disclosures mandated by the Real Estate Settlement Procedures Act (RESPA) are combined with disclosures mandated in the Truth in Lending Act (TILA).
‘CUNA remains very concerned with the board's current piecemeal process for amending Regulation Z, the rules that implement TILA, particularly since this act will be under the [Consumer Financial Protection] Bureau's purview starting in July of next year,’ CUNA wrote. ‘This process has imposed staggering costs and burdens on credit unions and has, in many respects, caused confusion for credit union members, which will be compounded if the board continues issuing new rules at the same time the Department of the Treasury and the new bureau proceed with similar efforts to integrate the TILA and RESPA disclosures.
‘We also urge the board to suspend all rulemaking with regard to the consumer disclosures under Regulation Z in order to coordinate these efforts with the Department of the Treasury and the Bureau as it moves forward with the process of combining the TILA and RESPA disclosures,’ CUNA continued. ‘This includes the proposal issued last year that would completely revise the TILA disclosures for both closed-end mortgage loans and for home equity lines of credit, as well as the mortgage loan proposal issued recently that would revise the rescission rules, amend the disclosure rules for reverse mortgages and would impose a number of other restrictions on mortgage lenders.’