In a May 9, 2012 press release published today on the Consumer Financial Protection Bureau (CFPB) website, the CFPB outlined rules it is considering that would affect mortgage points and fees and mortgage loan originator qualifications. The CFPB expects to propose these rules this summer and finalize them by January 21, 2013. Below is a redaction of the May 9th press release explaining the CFBP’s proposal: “The 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank) places certain restrictions on the points and fees offered with most mortgages. The CFPB is considering proposals that would: • Require an Interest-Rate Reduction When Consumers Elect to Pay Discount Points: Discount points are a fee, expressed as a percentage of the loan amount, to be paid by the consumer to the creditor at the time of loan origination in return for a lower interest rate. The CFPB is considering proposals to require that any discount point must be “bona fide,” which means that consumers must receive at least a certain minimum reduction of the interest rate in return for paying the point. • Require Lenders to Offer Consumers a No-Discount-Point Loan Option: Under the proposal under consideration, consumers must also be offered a no-discount-point loan. • Ban Origination Charges that Vary with the Size of the Loan: Brokerage firms and creditors would no longer be allowed to charge origination fees that vary with the size of the loan. Under the rules the CFPB is considering, brokerage firms and creditors would be allowed to charge only flat origination fees.
