The Consumer Financial Protection Bureau issued a final interpretive rule that establishes lenders’ requirements for providing mortgage applicants with a list of local homeownership counseling organizations.

The final rule restates guidance first issued by the CFPB in 2013, and also provides new guidance for lenders that are compiling their own list of housing counselors.

“Buying a home is often the largest financial decision in a consumer’s lifetime, and we want to ensure that consumers can access the independent and informed advice they deserve before making that decision,” said CFPB Director Richard Cordray.

“Housing counselors are a crucial source of that helpful advice,” Cordray continued. “We will continue to work to improve the home-buying experience for consumers, and today’s interpretive rule will help industry comply with these important protections.”

The CFPB’s final rule includes new instructions about how to provide applicants abroad with homeownership counseling lists; permissible geolocation tools; combining the homeownership counseling list with other disclosures; use of a consumer’s mailing address to provide the list; and high-cost mortgage counseling qualifications and lender participation in such counseling, the CFPB said.

Under the rules adopted as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act, lenders are required to provide applicants with a list of local housing counselors.

Consumers are to receive these lists shortly after they apply for a mortgage, so they know where to get help when deciding what loan is best for them, the CFPB said.

Lenders may fulfill the Dodd-Frank-stipulated requirement by using CFPB-developed housing counseling lists, which are available through an online tool the Bureau created in 2013, or by generating their own lists using the same U.S. Department of Housing and Urban Development data that the CFPB uses to build its lists.

One of the sections of the CFPB’s final rule deals with “high-cost mortgage counseling.” The CFPB’s Regulation Z stipulates that a lender cannot extend a “high-cost” mortgage unless the lender receives written certification that the borrower obtained counseling from a HUD-approved counselor.

The CFPB also noted that there is some concern over lenders directly participating in housing counseling.

“The Bureau has also received information that consumers may be receiving high-cost mortgage counseling by telephone in a creditor’s office while the creditor is present and listening-in,” the CFPB said in the published version of the final rule. “Such listening in may be objectionable by certain counselors, as it could diminish the quality of counseling.”

The CFPB states that lenders may be allowed to participate in the calls at the counselor’s request but reminds lenders of the “anti-steering provision,” which prohibits lenders from pushing a particular counselor.

“The Bureau believes that counselor independence and impartiality, which the anti-steering provision seeks to preserve, may be adversely affected by a concern that another counselor may be selected or the content of the counseling influenced if the counselor requests that the creditor not listen to the counseling and the creditor does not agree,” the CFPB said.

“Counselor independence and impartiality may also be compromised by the knowledge that the creditor is listening-in to the advice given,” the CFPB continued. “Moreover, creditor participation in such conversations may influence loan applicants away from a full and frank conversation with an independent and impartial counselor, thus undermining the purpose of the rule.”

Click here to read the CFPB’s final rule in full.