ALTA Joins 15 Other Organizations Urging CFPB to Follow ‘Grace Period' for TRID Compliance

March 19, 2015

ALTA joined 15 other organizations in a letter urging the Consumer Financial Protection Bureau to announce “restrained enforcement and liability” or “grace period” for those seeking to comply in good faith to the bureau’s TILA-RESPA integrated disclosure rule that goes into effect Aug. 1.

The associations asked Richard Cordray, the CFPB’s director, to follow a restrained period of enforcement through 2015 to help ease the burden on consumers from unanticipated obstacles to successful implementation of the TRID regulation.

Because the rule combines two regulations—RESPA and TILA—the associations believe there is uncertainty on how this will affect companies not regulated by TILA.

“Even with 21 months to prepare for these changes, understanding how to properly implement and comply with this uniquely complex regulation will not become clear until guidance is provided and stakeholders have experience using these new forms and processes,” the letter said. “While you have indicated that the CFPB would not act unreasonably on Aug. 2, there is no opportunity under this regulation to comply early, which means that industry will not be able to test systems, in real-time, in real circumstances, until after Aug. 1.”

The Department of Housing and Urban development followed a similar restrained enforcement period when it revised the GFE and HUD-1. HUD encouraged industry to provide feedback on the new disclosures by announcing it would not conduct enforcement actions against companies that tried to comply in good faith. Moreover, in the case at hand, it is important for the Bureau to restrain both enforcement and liability during the grace period for those acting in good faith.

Contact ALTA at 202-296-3671 or [email protected].