No matter how little or much one embraces the idea of a free market, most everyone agrees that the regulatory burden on financial institutions could be reformed and made better – through cutting red tape or smarter rules.

 “We continue to encourage banks to build a thoughtful and comprehensive compliance strategy for 2015,” says Edward Kramer, executive vice president, Regulatory Affairs, for Wolters Kluwer Financial Services. “The old mantra of ‘an ounce of prevention is worth a pound of cure’ is more relevant today than ever, as non-compliance increasingly is leading to severe monetary consequences that range from fines and penalties to harsh reputational and regulatory consequences.”

Here’s what Wolters Kluwer Financial Services think are the five starting points:

1. Truth-in-Lending Act and Real Estate Settlement Procedures Act 

TILA-REPSA integrated disclosure requirements take effect Aug. 1. The TILA-RESPA rules present unprecedented changes that will impact lenders’ entire mortgage operations, including business processes, technology, policies and procedures, vendor relationships, employee readiness, and customer service. Failure to comply could result in significant fines and penalties, costing thousands of dollars each day, as well as in regulatory and reputational risks. 

2.  Home Mortgage Disclosure Act 

New HMDA data collection requirements will be issued, although the final scope and details, along with an implementation date, are still unknown. What is clear is that the extent and breadth of additional data collection fields required will be significant, imposing added challenges on banks and other financial institutions.

3. Servicing and Sub-Servicing

Heightened emphasis on mortgage servicing and sub-servicing rules will continue—regulatory agencies have been very demonstrative about their intent in this area. During 2015, the industry can expect continued changes in mortgage servicing rules that will include new protections for surviving family members and other homeowners.

4.  Increased Scrutiny

Heightened regulatory scrutiny around bank examinations will continue, with even greater attention on the role a bank’s board of directors plays in overseeing compliance. Increasingly, examiners are monitoring to ensure that boards are fully involved not only in the establishment but in the oversight of an organization’s compliance programs.

5.Enhancing Risk Assessment

Fair and responsible lending regulatory efforts will increase. Since 2011, federal regulatory agencies have successfully prosecuted a number of cases involving discriminatory lending practices, leading to over $1 billion in monetary relief for individual borrowers and impacted communities. Lenders will need to enhance their ability to conduct effective risk assessments that promote fair and responsible lending concepts, maintain effective governance, and employ technologies that enhance their compliance management systems while building a fair and responsible lending culture.