Today the President signed the Economic Growth, Regulatory Relief, and Consumer Protection Act. The effective dates vary, with some being 12 – 18 months after enactment. Here are some highlights from a compliance perspective:
Banks/credit unions that together with their affiliates have less than $10 billion in assets receive a safe harbor under the ATR requirements for loans they keep, as long as the loan meets restrictions with prepayment penalties and points and fees; does not have negative amortization or an interest-only feature. To be eligible, debts, income and financial resources must be considered and verified. There are also circumstances in which a loan can qualify for the safe harbor even if it is transferred – for example, if the transfer is to a subsidiary.
For HMDA Banks, if you made less than 500 closed-end or open-end dwelling-secured loans in either of the prior two years, the Act is written so that you would no longer need to report new data fields, such as points and fees, property value, introductory rate period, non-fully amortizing features, etc. Specifically, loan type, owner occupancy status, census tract, income, and demographic information would seem sure to remain…from there, we will have to wait and see how the regulation will look. There is also a “qualifier” written in, that you would still need to report all data fields if your CRA rating is Needs to Improve or Substantial non-compliance. Now, we feel it only makes sense that the reporting requirements change with a new calendar year but the effective date for this one is not yet clear.
There also looks to be changes to the HPML Escrow requirements and even the Expedited Funds Availability Act.
So, once again change is coming. Even if that change is “regulatory relief”, there is bound to be confusion along the way. Don’t worry, we will be here to guide you throughout the process. For now, you can communicate that yes, relief is coming, but at this point, we don’t necessarily know exactly how it will all look or when it will all happen, as regulations will need to be issued to implement some of the changes.
David’s banking career began as a field examiner for the FDIC in 1990. He later became a Compliance Officer and Loan Officer for a small bank. In 1993, he established Banker’s Compliance Consulting. Along with his amazingly talented Team, he has written numerous compliance articles for prestigious banking publications and has developed compliance seminars that Banker’s Compliance Consulting produces.
He is an expert in compliance regulations. He is also a motivational speaker and innovative educator. His quick wit and sense of humor transforms the usually tiring topic of compliance into an enjoyable educational experience. David is on the faculty of the American Bankers Association National Compliance Schools and has served on the faculty of the Center for Financial Training for many years. He also is a frequent speaker at the ABA’s Regulatory Compliance Conference. He is also a trainer for hundreds of webinars, is a Certified Regulatory Compliance Manager (CRCM) and has been a BankersOnline Guru for many years. The American Bankers Association honored David with their Distinguished Service Award in 2016.
David and his wife Karen have three adult children, four grandchildren (none of whom live at home!) and two cats (of which Dave is allergic … the cats, not the children!). They recently moved to an acreage outside of Lincoln, Nebraska where he gets to play with his tractor. When possible David can be found fishing, making sawdust in his shop, or playing the guitar and piano. He also enjoys leading worship at his church.