House OKs TRID ‘safe harbor’ period
OCT. 7, 2015 -- The House has passed legislation on a vote of 303 - 121 that would extend and formalize the grace period of the CFPB’s new mortgage rule, and create a safe harbor protecting credit unions from legal recourse through Feb. 1, 2016.
NASCUS strongly supports a TRID “safe harbor,” as outlined in the association’s comment letter to the consumer agency this summer. In the letter, NASCUS urged the agency to adopt a “hold harmless period” (that is, a period in which a credit union would be protected from legal recourse), which would recognize “the magnitude of the operational changes that will accompany this rule, and give financial institutions a good-faith opportunity to manage their risk without disrupting their service to members.”
The bill approved Wednesday, HR 3192 (the Homebuyers Assistance Act), concerns the CFPB’s Truth in Lending Act-Real Estate Settlement Procedures Act integrated disclosure (TRID) rule, which became effective Oct. 3. The legislation has the strong support of credit union and bank trade groups. It is sponsored by Reps. French Hill (R-Ark.) and Brad Sherman (D-Calif.).
The vote came late Wednesday afternoon, and followed a veto warning issued by the White House late Tuesday. "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 its release.