CFPB Updates Financial Institution Exam Procedures

The Consumer Financial ProtectionrnBureau (CFPB) has released a set of exam procedures to assistrnfinancial institutions and mortgage companies plan for regulatoryrnexaminations once the new mortgage rules become effective. Thernupdated procedures, the second set issued by CFPB in the last fewrnweeks, cover the Bureau’s origination rules issued through the endrnof May and mortgage servicing rules issued through July 10. Most ofrnthe new rules with which the institutions will have to comply will gorninto effect in January 2014. </p

“We are committed to transparency around our examinationrnprocess,” said CFPB Director Richard Cordray. “So we have workedrnhard to provide industry with advance notice of what we will bernexpecting. That, in turn, will improve compliance and benefitrnconsumers.”</p

The updates issued on Thursday cover thernAbility-to-Repay/Qualified Mortgages, high-cost mortgages, andrnappraisals for higher-priced mortgage loans, as well as newrnamendments related to the escrows rule. The updates also cover recentrnchanges to credit card rules. </p

The CFPB is sharing with industry what it will be looking for inrnits examinations under the new rules by updating the applicablernsections of the exam procedure manuals for the Truth in Lending Actrn(TILA) and the Real Estate Settlement Procedures Act (RESPA). Theserndocuments are intended for use by CFPB examiners in examining thernmortgage companies and other financial institutions subject to thernnew regulations. </p

A copy of the RESPA exam procedures released today can be foundrnat:
http://files.consumerfinance.gov/f/201308_cfpb_respa_narrative-exam-procedures.pdf</p

A copy of the TILA exam procedures released today can be foundrnat:
http://files.consumerfinance.gov/f/201308_cfpb_tila-narrative-exam-procedures.pdf

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