Proposed Delay of Prohibition on Financing Single-Premium Credit Insurance

The CFPB has issued a proposal to delay the effective date of the general prohibition on financing single-BSA Training and Banking Regulations Compliance Consulting diane11 - Proposed Delay of Prohibition on Financing Single-Premium Credit Insurancepremium credit insurance.  This prohibition is otherwise scheduled to take effect June 1, 2013.  Comments on the proposal are due May 25, 2013.

The goal of the delay is to allow the CFPB a chance to clarify the circumstances in which credit insurance premiums could be paid periodically, rather than financed. The Rule applies to all consumer closed-end transactions secured by a dwelling and also open-end lines of credit when secured by the consumer’s principal dwelling.

It will be interesting to see how this develops.  The CFPB will need to move quickly once the comment period ends and the current effective date of June 1st.

Published
2013/05/15
Diane Dean

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