Lending

TRID grace period bill stuck in limbo

Status of the Homebuyers Assistance Act

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A bill designed to give the mortgage industry more defined security on TRID implementation is stuck in limbo after a series of attempts to get it passed.

The Homebuyers Assistance Act, H.R. 3192, which was sponsored by Rep. French Hill, R-Ark., provides a four-month grace period for businesses that are working in good faith to comply with the TILA-RESPA Integrated Disclosure rule from the Consumer Financial Protection Bureau, which went into effect Oct. 3.

The bill was welcomed by the industry after the new disclosure rule went to effect because of a lack of clarity regarding how it was going to be enforced.

However, the bill was put on the back burner after it failed to make it into the year-end spending legislation, leaving Hill's office to look for a plan B to move it along.

Hill's office wanted to add the bill to any year-end spending legislation in order to give it a greater chance of passing, since the White House already said that it would veto the Homebuyers Assistance Act.

"The CFPB has already clearly stated that initial examinations will evaluate good faith efforts by lenders. The Administration strongly opposes [the bill], as it would unnecessarily delay implementation of important consumer protections designed to eradicate opaque lending practices that contribute to risky mortgages, hurt homeowners by removing the private right of action for violations, and undercut the nation's financial stability," the White House said in a previous release.

“If the President were presented with H.R. 3192, his senior advisors would recommend that he veto the bill,” the statement said.

Whether or not it changes anything, it’s worth noting that the top White House advisor on housing policy, Michael Stegman, will be leaving his position as of March 25.

While Hill's latest update didn’t announce any progress on the bill, he did reiterate the necessity of the bill.

From Hill’s office:

In February, Rep. Hill stated: CFPB’s lack of interest in rectifying the problem that it caused speaks volumes about its true commitment to helping consumers. Despite numerous reports of the TRID rule delaying the home-buying process for American families, CFPB is sitting on its hands and has done virtually nothing to help consumers, title companies, lenders, and realtors navigate this new closing regime since. Moving forward, CFPB must work with Congress and the real estate industry to provide guidance and eliminate confusion and uncertainty to best serve those hoping to achieve the American dream of home ownership.

Nearly two months later, CFPB still has not corrected the issue and the effects of that are having negative consequences on the hundreds of thousands of Americans each month looking to buy homes.

At the end of December, after a letter to the CFPB, the Mortgage Bankers Association released a response from CFPB Director Richard Cordray that brought some clarity to the industry on TRID implementation, but still wasn’t a finite answer on the specifics of enforcement. 

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