As a 21st century agency created by the Dodd-Frank Act, we’re here to make consumer finance markets work by making rules more effective, by consistently and fairly enforcing those rules, and by empowering consumers to take more control over their economic lives.
An important part of our mandate is to make rules more effective and create new rules when necessary. Today, we’re posting a semi-annual update of our rulemaking agenda as part of the federal government’s Unified Agenda of Regulatory and Deregulatory Actions.
Under the Regulatory Flexibility Act, federal agencies must publish regulatory agendas twice a year. We’ve been voluntarily participating in the Unified Agenda. The Office of Management and Budget leads this effort. The Unified Agenda is available in full online, and portions will also be published in the Federal Register. The agenda includes rulemaking actions in pre-rule, proposed rule, final rule, long-term, and completed stages.
Here’s an overview of our major initiatives.
Updates to the Home Mortgage Disclosure Act (HMDA)
We’re working to finalize a proposed rule we published in August 2014 to implement Dodd-Frank Act amendments to the Home Mortgage Disclosure Act (HMDA). The proposal would help align the law with existing industry standards for collecting data on mortgage loans and applications. It would also improve HMDA’s effectiveness through changes to institutional and transactional coverage, modifications of reporting requirements, and clarifications of existing regulatory provisions. We expect to release a final rule in late summer.
Truth in Lending Act (TILA) and Real Estate Settlement Procedures Act (RESPA) Integrated Disclosures
We also continue to focus intensely on supporting efforts to implement a rule, required by Dodd-Frank, that consolidates and streamlines federal mortgage disclosures required under TILA and RESPA. In February 2015, we issued a small follow-up rule to provide technical corrections, address the provision of language relating to new construction loans on the Loan Estimate form, and relax certain timing requirements regarding revised disclosures. We’ve provided guides and materials to help industry and consumers prepare for the changes. The rule will take effect on August 1, 2015.
Follow-up on other mortgage rules
We’re also continuing to work with stakeholders to address questions about rules we released in January 2013 to implement various Dodd-Frank Act mortgage reforms. Among other efforts, we’re issuing clarifications and amendments as warranted. For example, we’re working to finalize a proposal we published in February 2015 to modify certain requirements for small creditors, including those that operate predominantly in “rural or underserved” areas. We expect to issue a final rule in fall 2015.
We also published a larger proposal in December 2014 to amend certain aspects of the 2013 mortgage servicing rules. The proposed rule would affect disclosures, early intervention, and loss mitigation. The proposal also addresses compliance with the rules when a consumer is a potential or confirmed successor in interest, is in bankruptcy, or sends a cease communication request under the Fair Debt Collection Practices Act (FDCPA). We expect to issue a final rule in spring 2016.
Prepaid financial products
We’re finalizing a proposal we published in December 2014 that would create comprehensive consumer protections for a range of prepaid financial products, including general-purpose reloadable prepaid cards and certain digital and mobile wallets. Under the proposal, prepaid accounts would receive certain protections that are similar to those that exist now for debit and payroll cards. The protections relate to, among other things:
- Error resolution
- Limitations on liability when a card is lost or stolen
- The provision of information about account activity.
We also proposed general credit card protections to prepaid products that access overdraft services or offer credit features for a fee. Under the proposal, these products would be treated generally as credit cards under TILA and Regulation Z. The proposal would include:
- Requirements that creditors assess consumers’ ability to repay before extending them credit
- Fee limitations in the first year of account opening
- Certain rules regarding payment periods and processing
- Specific disclosures before a consumer acquires a prepaid account.
We expect to issue a final rule in early 2016.
Payday, auto title, and certain other loans
We recently released an outline of proposals we’re considering in connection with regulating payday loans, auto-title loans, and certain other longer-term credit products. We consulted with a panel of small lenders, under the Small Business Regulatory Enforcement Fairness Act, who may be affected by the rulemaking. We’ve also published research on payday lending and so-called deposit advance products, including an April 2013 white paper and a March 2014 data point. We plan to issue a Notice of Proposed Rulemaking later this year after completing additional outreach and analysis.
We’re continuing to analyze issues relating to overdraft services on checking accounts. Our analysis builds on a June 2013 white paper and a July 2014 report . We’re conducting additional research and assessing whether rulemaking is warranted.
We continue to issue rules implementing our supervisory program for certain nonbank entities by defining “larger participants” in various markets for consumer financial products and services. We expect to finalize a proposal early this summer to define “larger participants” in the market for auto lending. This will build on previous rules defining larger participants in the markets for debt collection, credit reporting, student loan servicing, and international money transfers.
We are developing proposed rules concerning debt collection. Last year, we received more than 23,000 comments in response to an Advanced Notice of Proposed Rulemaking. In developing our proposal, we’re surveying consumers about their experiences with debt collectors. We’re also engaged in consumer testing initiatives to determine what information would be useful for consumers to have about debt collection and their debts, and to determine how that information should be provided to them.
We’re following up on research we conducted under the Dodd-Frank Act concerning the use of arbitration agreements involving consumer financial products or services. We issued a preliminary report in December 2013 and a report to Congress in March 2015. We’re now evaluating feedback we received and considering whether rules governing arbitration clauses may be warranted.
We’re continuing research, analysis, and outreach on a number of other consumer financial services markets, and we’ll update our next semi-annual agenda in the fall.