Wednesday, August 26, 2015

ABA seeks clear path for compliance before TRID rule rollout

By J. Preston Carter, J.D., LL.M.

In a letter to the federal financial regulators, American Bankers Association President and CEO Frank Keating is asking the Federal Financial Institutions Examination Council to explain its policy for examining and supervising financial institutions in the initial months after the TILA-RESPA integrated disclosure (TRID) rule becomes effective. The Consumer Financial Protection Bureau recently finalized the extension of the TRID rule’s effective date to Oct. 3, 2015.

Keating’s letter points out that the CFPB indicated regulators will be sensitive to the good-faith efforts of lenders to comply with the TRID rules in a timely manner. Keating asks the FFIEC to “formally establish a transition period and clarify how regulators will oversee and examine regulated institutions for TRID compliance during this time.” By doing so, he continued, the FFIEC would “provide needed certainty to the credit markets and encourage lenders to continue to provide mortgage credit to qualified borrowers.”


Bankers will be more likely to maintain credit flows, said Keating, if they have greater assurance that supervisory reviews will reflect consideration of factors such as the dates compliance systems were received, operational problems that required debugging efforts, the extent to which necessary training was possible before systems are fully operational, and the adequacy and reasonableness of training programs once systems are functional. Keating contends that “in light of the volume, intricacies and delays associated with the TRID regulations, the only way to realistically ensure an orderly transition is to confirm that supervisory standards work in tandem with lender efforts to refine and debug systems following the effective date.”

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