Proposed delay in effective date for Regulation Z provision prohibiting financing of credit insurance
In January, we issued several new mortgage rules under the Dodd-Frank Act. Most of these rules take effect in January 2014, but a few provisions are scheduled to take effect on June 1 of this year. This week we issued a proposal that seeks comment on whether to delay the June 1 effective date with regard to a provision concerning credit insurance while we address some interpretive issues that have arisen about the provision.
The proposal concerns the implementation of a prohibition on creditors financing credit insurance premiums in connection with certain consumer credit transactions secured by a dwelling. This provision was adopted in the Loan Originator Compensation Requirements under the Truth in Lending Act (Regulation Z) Final Rule, issued on January 20, 2013.
We welcome comment during the 15 day period following publication of the proposal in the Federal Register.
This proposal follows two we issued last month to clarify and correct some aspects of the 2013 Escrows Final Rule, the Ability-to-Repay and Qualified Mortgage Rule and the Mortgage Servicing Rules. We are issuing these proposals as part of our ongoing commitment to facilitate implementation of the rules we issued under the Dodd-Frank Act in January.