By: Andrew A. Turner, J.D.
With the issuance of rulemaking proposals on arbitration and payday lending, the Consumer Financial Protection Bureau’s spring 2016 rulemaking agenda next promises rule amendments on prepaid accounts and mortgage servicing.
The Consumer Financial Protection Bureau expects to issue a final rule in early summer to create a comprehensive set of consumer protections for prepaid financial products, such as general purpose reloadable cards and other similar products, which are increasingly being used by consumers in place of traditional checking accounts. The CFPB is considering requiring prepaid product sellers to give consumers account-opening disclosures and periodic statements. The proposal would establish error-resolution procedures, limit consumer liability for unauthorized charges, and impose rules that would govern prepaid cards offering credit features, such as those that allow overdrafts.
The CFPB also expects to issue a final rule in early summer to amend aspects of mortgage servicing rules. The CFPB has proposed significant amendments to its rules on mortgage servicing and protections for mortgage borrowers who are in financial distress or in danger of losing their homes through foreclosure. The proposal focuses primarily on clarifying, revising, or amending provisions regarding force-placed insurance notices; policies and procedures, early intervention, and loss mitigation requirements under Regulation X's servicing provisions; and periodic statement requirements under Regulation Z's servicing provisions.
In addition, this summer the CFPB expects to release a proposal to clarify mortgage disclosure requirements. The CFPB is seeking to address industry groups’ concerns regarding compliance with the “Know Before You Owe” mortgage disclosure forms.
Four items are listed in the pre-rule stage: overdraft services on checking accounts; debt collection practices; supervision of larger participants in installment loan and vehicle title loan markets; and small business lending data.
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