Bureau notes holiday issues with mortgage disclosures
(June 25, 2021) The timing of mortgage lenders’ compliance with federal disclosure rules may have been disrupted with the abrupt implementation of the new “Juneteenth” federal holiday late last week – perhaps even delaying mortgage closings – the CFPB said it was aware of concerns those disruptions have raised.
In a statement, bureau Acting Director Dave Uejio said the concerns revolved around mortgage lender compliance with Truth in Lending Act (TILA) and TILA-RESPA (Real Estate Settlements Protection Act) Integrated Disclosure (TRID) timing requirements. “The CFPB recognizes that some lenders did not have sufficient time after the Federal holiday declaration to consider whether and how to adjust closing timelines,” Uejio wrote. “The CFPB understands that some lenders may delay closings to accommodate the reissuance of disclosures adjusted for the new Federal holiday.”
Uejio said both TILA and TRID requirements generally protect creditors from liability for bona fide errors and permit redisclosure after closing to correct errors.
The acting CFPB director said any guidance ultimately issued by the CFPB would consider the limited implementation period before the holiday and would be issued after consultation with both federal and state financial institution regulators “to ensure consistency of interpretation for all regulated entities.”