In a September 9, 2014 notice, the Board of Governors of the Federal Reserve System (FRB) and the Consumer Financial Protection Bureau (CFPB) published final rules amending the official interpretation and commentary to Regulations Z by increasing the threshold for exempt consumer credit transactions to $54,600, effective January 1, 2015.
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Read articles below for analysis and discussion of recent trends by BM&G’s industry experts.
Mortgage Loan Officer Overtime Pay in Light of Recent Cases
Recently we were asked by a client if the invalidation of the March 24, 2010 U.S. Department of Labor Administrator’s Interpretation No. 2010-1 (AI 2010-1) by the District of Columbia Circuit Court of Appeals’ July 2, 2013 decision in Mortgage Bankers Assoc. v. Harris, 720 F.3d 966 (D.C. Cir., 2013), cert. granted, 134 S.Ct. 2820 (U.S. Jun 16, 2014), herein the “Harris decision,” allows employers to re-classify their mortgage loan officers (MLO) as administrative employees exempt from overtime requirements under the Fair Labor Standards Act (FLSA). Our recommendation is that employers should not re-classify MLO employees as exempt administrative employees based on the Harris decision, for the following reasons:
CRA Interagency Questions and Answers – Proposed Revisions
In today’s Federal Register (79 FR 53838) the Office of the Comptroller of the Currency (OCC), Board of Governors of the Federal Reserve System (Board), and Federal Deposit Insurance Corporation (FDIC) published proposed revisions to their “Interagency Questions and Answers Regarding Community Reinvestment,” which provides guidance on the above federal agencies’ (collectively the Agencies) regulations implementing the Community Reinvestment Act (CRA). The Agencies also requested public comment on the proposed revisions.
Interagency Guidance Regarding Unfair or Deceptive Credit Practices
On August 22, 2014, the Consumer Financial Protection Bureau (CFPB), Federal Reserve Board (FRB), Federal Deposit Insurance Corporation (FDIC), National Credit Union Administration (NCUA), and Office of the Comptroller of the Currency (OCC) (herein “Agencies”) issued the above referenced Interagency Guidance (click here).
FHA Adjustable Rate Mortgage Interest Rate Adjustment and Notification Regulations under the FHA Single Family Mortgage Insurance Program are Revised
In the August 26, 2014, Federal Register (79 FR 50838), the Federal Housing Administration (FHA) published a final rule (click here) that revises two FHA single family adjustable rate mortgage (ARM) regulations. The final rule revises §203.49(d)(2) to require that an interest rate adjustment resulting in a corresponding change to the mortgagor’s monthly payment for a FHA-insured ARM have a 45-day look-back period.
FHA Final Rule Prohibits Post-Payment Interest Charges for Prepayment of FHA Mortgages under the FHA Single Family Mortgage Insurance Program
In the August 26, 2014, Federal Register (79 FR 50835), the Federal Housing Administration (FHA) published a final rule (click here) that effective for FHA-insured mortgages closing on or after January 21, 2015, revises FHA’s regulations to prohibit an FHA approved mortgagee from charging the mortgagor interest through the end of the month in which the mortgage is being prepaid, allowing them instead to charge interest only through the date the mortgage is prepaid, and prohibits the charging of interest beyond that date.
CFPB Publishes HMDA Proposed Amendments in Federal Register
In the August 29, 2014 issue of the Federal Register (click here) the CFPB published for public comment a proposed rule to amend Regulation C (12 CFR Part 1003) to implement amendments to the Home Mortgage Disclosure Act (HMDA) made by section 1094 of the Dodd-Frank Act. The rule proposes to add several new reporting requirements, to clarify several existing requirements, and to change institutional and transactional coverage.
CFPB Bulletin 2014-01 – Compliance Bulletin and Policy Guidance for Mortgage Servicing Transfers
On August 19, 2014, the CFPB issued the above referenced bulletin (click here) updating and replacing similar guidance by the CFPB in Bulletin 2013-01 issued prior to RESPA’s new servicing rule that took effect on January 10, 2014 (12 CFR §1024.30, et seq.).
Regulation Z HOEPA and Qualified Mortgage Annual Threshold Adjustments
In the August 15, 2014 issue of the Federal Register (79 FR 48015), the Consumer Financial Protection Bureau established the following 2015 thresholds for high-cost and qualified mortgages under §§1026.32 and 1026.43, respectively.
Proposed Pre-Licensure Education Expiration Policy
In a July 23, 2014 proposal posted on the NMLS Resource Center website, the State Regulatory Registry LLC, a limited liability company that owns and operates the Nationwide Mortgage Licensing System and Registry (NMLS), proposes to create the following three year pre-licensure education expiration policy: