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Final list of rural and underserved counties for use in 2013

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On June 1, 2013, our Escrow Requirements under the Truth in Lending Act rule (Escrows Rule) will go into effect, which requires certain creditors to create escrow accounts for a minimum of 5 years for higher-priced mortgage loans (HPMLs). The rule exempts HPMLs made by certain small creditors that operate predominantly in rural or underserved counties from this requirement. On March 12, 2013, we posted a preliminary list of counties that are rural or underserved (or both), for use in the second part of 2013. That preliminary list applied the rules for determining both rural and underserved status as those rules would be amended by a proposed rule the Bureau intended at that time to publish.

The CFPB is now issuing the final rule based on the proposed rule that we had used to compile the preliminary list. Because the methods for determining rural and underserved status have not changed from the proposed rule, this final list is identical to the preliminary list we posted on March 12. For purposes of applying the exemption in the Escrows Rule, creditors may rely on this list as a safe harbor to determine whether a county is “rural” or “underserved” for loans made from June 1, 2013, through December 31, 2013.

In our Escrows Rule, rural counties are defined by using the USDA Economic Research Service’s urban influence codes, and underserved counties are defined by reference to data collected under the Home Mortgage Disclosure Act (HMDA). As explained in the rule, the Bureau will post a list of such counties on its website, which we are doing today.

We also have several rules that will that take effect in January 2014 that have provisions related to mortgage loans made in rural or underserved counties.

Some counties’ status as rural or non-rural may change from the 2013 list to the 2014 list because of updated information from the 2010 Census. This updated information is still being analyzed by the Economic Research Service, but we’ll post the 2014 list of rural and underserved counties as soon as possible.

See a full table of the regulatory sections involved.

  • Rush Bricken

    The rural / urban designations have all kinds of flaws. If you go to the USDA lists of RUCC coded counties, many non metro coded 4,5 and 6 counties are on the CFPB list and many are not. The nonmetro codes starts at 4 or greater. These should all be listed?

    • http://nextwave-creative.com/ Tony Young

      It is true that they have flaws, but it has some improvements to make the rural countries better. It takes time to cover all.
      Blogger Tony from nextwave-creative.com

  • Doug Myers

    The list is evidence that the rulemaking with respect to defining ‘rural’ is far off the mark. Based on our institutional history of the last few years this rule will deprive our county field of membership of our support for approximately $1/3 million in mobile home lending. This is a market sector greatly underserved and effectively abandoned by most lenders. CFPB seemingly ignores well-established definitions of ‘rural’ under NCUA rules for which we have qualified for many years in our designation as a credit union serving Low Income membership and with an enviable record of financial prudence. It appears the focus of the Bureau is helping regulated parties to understand teh basis for and how to apply a poorly crafted rule rather than on mitigating the harmful effect this rule will have on rural counties such as ours. Once again (as with the remittance transfer rule), the (hopefully unintended) effect of this Bureau rule is to push good lenders from the market leaving it to those few that can dominate the profitable sectors and depriving consumers in rural markets of the choices they would have otherwise had.

  • Michal

    Very useful informations. Thanks, and best regards from markizy warszawa

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