TDRs, GSE Flexibilities, BSA Proposal; and CFPB on GSE, HMDA, ANPR

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As an additional resource for credit unions, the League is providing this reference guide — "TDR Designation and COVID-19 Loan Modifications: Section 4013 of the CARES Act" — issued by the Office of the Controller of the Currency (OCC). The guide provides a summary and flowchart to help identify whether loan modifications granted due to COVID-19 should be classified and accounted for as a Troubled Debt Restructure (TDR).

This guide was also included as a resource during a complimentary League webinar this past August, entitled "Loan Modifications: Forbearance, Financial Reporting and Other Considerations".

Agencies Invite Comment on Proposed Rule Under BSA
The Financial Crimes Enforcement Network (FinCEN) and the Federal Reserve Board are inviting comment on a proposed rule that would amend the recordkeeping and travel rule regulations under the Bank Secrecy Act (BSA). FinCEN and the board, pursuant to their shared authority, are proposing amendments to the recordkeeping rule jointly, while FinCEN, pursuant to its sole authority, is proposing amendments to the travel rule. Comments will be accepted for 30 days after publication in the Federal Register.

Fannie and Freddie Extend COVID-19 Loan Flexibilities
The Federal Housing Finance Agency (FHFA) has announced that Fannie Mae and Freddie Mac will extend several of their loan origination flexibilities until the end of November 2020. The changes are to ensure continued support for borrowers during the COVID-19 national emergency. The flexibilities were set to expire on Oct. 31. The extended flexibilities include:

  • Alternative appraisals on purchase and rate-term refinance loans.
  • Alternative methods for documenting income and verifying employment before loan closing.
  • Expanding the use of power-of-attorney to assist with loan closings.

Bureau Issues Final Rule Extending the GSE Patch
The Consumer Financial Protection Bureau (CFPB) recently issued a final rule to extend the Government-Sponsored Enterprise (GSE) Patch, which provides certain mortgage loans that are eligible for purchase by the GSEs (Fannie Mae and Freddie Mac) to receive qualified mortgage (QM) status. The GSE Patch was scheduled to sunset on Jan. 21, 2021; but the CFPB’s final rule will extend the GSE Patch until the date a final rule amending the general QM loan definition becomes effective. The CFPB is not amending the provision in Regulation Z stating that the GSE Patch will expire if Fannie Mae and Freddie Mac exit conservatorship.

The CFPB issued a proposal to amend the general QM loan definition on June 22, the same day it issued a proposal to extend the GSE Patch.

The bureau is also currently developing a final rule amending the general QM loan definition and is planning to issue it at a later date.

Bureau Posts HMDA Data Reference Chart for 2021
The CFPB posted the "Reportable HMDA Data: A Regulatory and Reporting Overview Reference Chart for HMDA Data Collected in 2021", which can be used as a reference tool for data points required to be collected, recorded, and reported under Regulation C, as amended by the HMDA rules. Relevant regulation and commentary sections are provided for ease of reference. The chart also incorporates information found in Section 4.2.2 of the 2021 Filing Instructions Guide and provides when to report “not applicable” or “exempt.”

Bureau’s Issues ANPR on Consumer Access to Financial Records
The CFPB has also issued an Advance Notice of Proposed Rulemaking requesting information related to consumer access to financial records. The bureau is soliciting input to assist in developing regulations to implement Section 1033 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, which provides for consumer rights to access financial records.

The ANPR seeks comments on costs and benefits of consumer data access; competitive incentives; standard setting; access scope; consumer control and privacy; other legal requirements; data security; and data accuracy.

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