January 2018 marks five years since the Consumer Financial Protection Bureau finalized the qualified mortgage rule, as well as other key mortgage regulations.
The five-year anniversary means more than a landmark date of a major regulation though.
Under Dodd-Frank, the CFPB must “use available evidence and data to assess all of its rules five years after they go into effect to ensure they are meeting the purposes and objectives of Dodd-Frank, and the specific goals of the subject rule,” Pavitra Bacon stated in a blog on the CFPB Monitor.
While there’s still plenty of time before January 2018, Bacon noted in the blog that Chris D’Angelo, associate director of the CFPB’s Division of Supervision, Enforcement and Fair Lending, recently went on record saying that the CFPB is starting the beginning process of assessing its major mortgage rules.
In doing so, D’Angelo said the CFPB would assess its mortgage rules to see how they are impacting the market, along with if they fulfilling their purpose. He also noted the bureau would check to see if there’s some tailoring needed to make rules more effective.
The timing of the anniversary is noteworthy, as Bacon points out, since President Donald Trump recently passed an executive order to drastically reduce regulation.
According to the executive order, “It is the policy of the executive branch to be prudent and financially responsible in the expenditure of funds, from both public and private sources.”
“Toward that end, it is important that for every one new regulation issued, at least two prior regulations be identified for elimination, and that the cost of planned regulations be prudently managed and controlled through a budgeting process,” the order stated.
Even though the CFPB is reviewing its mortgage rules because of Dodd-Frank, there is a chance the CFPB could choose to honor the executive to cut back on regulation.
As it stands, the CFPB is an independent agency and is not required to follow the executive order on reducing regulation.