[Federal Register Volume 77, Number 173 (Thursday, September 6, 2012)]
[Proposed Rules]
[Pages 54843-54844]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-22000]


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BUREAU OF CONSUMER FINANCIAL PROTECTION

12 CFR Part 1026

[Docket No. CFPB-2012-0028]
RIN 3170-AA19


Integrated Mortgage Disclosures Under the Real Estate Settlement 
Procedure Act (Regulation X) and the Truth In Lending Act (Regulation 
Z)

AGENCY: Bureau of Consumer Financial Protection.

ACTION: Notice of request for public comment; extension of comment 
period.

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SUMMARY: On July 9, 2012, the Consumer Financial Protection Bureau 
(Bureau) published on its Web site and transmitted to the Federal 
Register a notice requesting comment on proposed rules and forms to 
integrate certain disclosure requirements of the Truth in Lending Act 
(TILA) and the Real Estate Settlement Procedures Act (RESPA) for most 
closed-end consumer credit transactions secured by real property, as 
required by the Dodd-Frank Wall Street Reform and Consumer Protection 
Act (Dodd-Frank Act). The proposed rule, which would amend Regulation X 
(RESPA) and Regulation Z (TILA), was published in the Federal Register 
on August 23, 2012. See 77 FR 51116 (Aug. 23, 2012). Comments on the 
integrated rules and forms are due November 6, 2012. However, the 
proposed rule set a comment deadline of September 7, 2012 on two 
issues: Proposed changes to the definition of the finance charge; and 
whether to delay implementation of certain disclosure requirements 
added to TILA and RESPA by title XIV of the Dodd-Frank Act. Because of 
the relationship of the proposed changes to other ongoing Bureau 
rulemakings and the Bureau's request for data on the potential impact 
of the proposed changes to the finance charge on those rulemakings, the 
Bureau has determined that an extension of the comment period until 
November 6, 2012 is appropriate. This extension applies solely to the 
proposed changes to the definition of the finance charge.

DATES: The comment period for the proposed amendments to 12 CFR 1026.4 
contained in the Bureau's notice at 77 FR 51116 (Aug. 23, 2012) is 
extended to November 6, 2012. The comment period for the proposed 
changes to 12 CFR 1026.1(c) contained in that notice, which ends on 
September 7, 2012, is unchanged. The comment period for all other 
proposed amendments in that notice, which ends on November 6, 2012, is 
unchanged.

ADDRESSES: You may submit comments, identified by Docket No. CFPB-2012-
0028 or RIN 3170-AA19, by any of the following methods:
     Electronic: http://www.regulations.gov. Follow the 
instructions for submitting comments.
     Mail/Hand Delivery/Courier: Monica Jackson, Office of the 
Executive Secretary, Consumer Financial Protection Bureau, 1700 G 
Street, NW., Washington, DC 20552.
    Instructions: All submissions should include the agency name and 
docket number or Regulatory Information Number (RIN) for this 
rulemaking. Because paper mail in the Washington, DC area and at the 
Bureau is subject to delay, commenters are encouraged to submit 
comments electronically. In general, all comments received will be 
posted without change to http://www.regulations.gov. In addition, 
comments will be available for public inspection and copying at 1700 G 
Street, NW., Washington, DC 20552, on official business days between 
the hours of 10 a.m. and 5 p.m. Eastern Time. You can make an 
appointment to inspect the documents by telephoning (202) 435-7275.
    All comments, including attachments and other supporting materials, 
will become part of the public record and subject to public disclosure. 
Sensitive personal information, such as account numbers or social 
security numbers, should not be included. Comments will not be edited 
to remove any identifying or contact information.

FOR FURTHER INFORMATION CONTACT: Priscilla Walton-Fein, Counsel, or 
Paul Mondor, Managing Counsel, Office of Regulations, at (202) 435-
7700.

SUPPLEMENTARY INFORMATION: On July 9, 2012, the Consumer Financial 
Protection Bureau (Bureau) published on its Web site and transmitted to 
the Federal Register a notice requesting comment on proposed rules and 
forms to integrate certain disclosure requirements of the Truth in 
Lending Act (TILA) and the Real Estate Settlement Procedures Act 
(RESPA) for most closed-end consumer credit transactions secured by 
real property (TILA-RESPA Integration Proposal), as required by 
sections 1032(f), 1098, and 1100A of the Dodd-Frank Wall Street Reform 
and Consumer Protection Act (Dodd-Frank Act). The proposed rule would 
amend Regulation X (RESPA) and Regulation Z (TILA). The notice was 
published in the Federal Register on August 23, 2012.\1\ In addition to 
requesting comment on the integrated rules and forms, the TILA-RESPA 
Integration Proposal requests comment on other amendments to Regulation 
Z, including proposed provisions to delay implementation of certain 
disclosure requirements added to TILA and RESPA by title XIV of the 
Dodd-Frank Act (in proposed Sec.  1026.1(c)) and proposed changes to 
the definition of the finance charge (in proposed Sec.  1026.4).
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    \1\ 77 FR 51116 (Aug. 23, 2012). The version of the TILA-RESPA 
Integration Proposal published in the Federal Register on August 23, 
2012 is identical to the version of the proposed rule published on 
the Bureau's Web site on July 9, 2012, except for limited formatting 
and typographical changes.
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    Under proposed Sec.  1026.4, most of the current exclusions from 
the finance charge would be eliminated for closed-end transactions 
secured by real property or a dwelling, resulting in a simpler, more 
inclusive definition of the

[[Page 54844]]

finance charge. This aspect of the TILA-RESPA Integration Proposal 
largely mirrors a 2009 proposed rule published by the Board of 
Governors of the Federal Reserve System (Board), which was not 
finalized before TILA rulemaking authority transferred to the Bureau 
(2009 Closed-End Proposal).\2\
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    \2\ 74 FR 43232 (Aug. 26, 2009).
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    The TILA-RESPA Integration Proposal provides for a bifurcated 
comment process. Comments regarding the proposed amendments to 
Sec. Sec.  1026.1(c) and 1026.4 must be received on or before September 
7, 2012. For all other proposed amendments, comments must be received 
on or before November 6, 2012.
    The TILA-RESPA Integration Proposal describes the rationale for a 
bifurcated comment process. With respect to the proposed changes to the 
definition of the finance charge, the proposed rule notes that the 
Bureau expects to issue several final rules to implement provisions of 
title XIV of the Dodd-Frank Act by January 21, 2013, that address loan 
pricing thresholds for coverage of various substantive requirements 
under the Home Ownership and Equity Protection Act (HOEPA) and other 
Dodd-Frank Act provisions that are based, at least in part, on the 
finance charge and corresponding annual percentage rate (APR).\3\ 
Accordingly, the Bureau wished to evaluate comments on the expanded 
definition of the finance charge simultaneously with comments on the 
other proposed rules, and therefore provided a comment period of 60 
days for the proposed amendments to Sec.  1026.4, rather than the 120-
day comment period provided for most other aspects of the proposed 
rule. The Bureau also believed a shorter comment period would be 
appropriate for the proposed changes to the finance charge definition 
given that this aspect of the proposal largely mirrors the 2009 Closed-
End Proposal. The Bureau also sought comment on the timing of 
implementation of the proposed changes to the finance charge definition 
in light of the Bureau's other rulemakings.
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    \3\ Generally, these other rulemakings are as follows: (1) 
Expanded protections for high-cost mortgage loans under HOEPA 
pursuant to TILA sections 103(bb) and 129, as amended by Dodd-Frank 
Act sections 1431 through 1433 (see proposed rule at 77 FR 49089 
(Aug. 15, 2012)); (2) requirements for creditors to determine that a 
consumer can repay a mortgage loan and the establishment of minimum 
standards for compliance, such as by making a ``qualified 
mortgage,'' pursuant to TILA section 129C, as established by Dodd-
Frank Act sections 1411 and 1412 (see proposed rule at 76 FR 27390 
(May 11, 2011)); (3) required escrow account disclosures and 
mandatory escrow accounts for certain first-lien higher-priced 
mortgage loans pursuant to TILA section 129D, as established by 
Dodd-Frank Act sections 1461 and 1462 (see proposed rule at 76 FR 
11598 (Mar. 2, 2011)); and (4) required appraisals for higher-risk 
mortgages pursuant to TILA section 129H, as established by Dodd-
Frank Act section 1471 (see proposed rule at https://s3.amazonaws.com/public-inspection.federalregister.gov/2012-20432.pdf; Federal Register publication scheduled for September 5, 
2012). The TILA-RESPA Integration Proposal explains in detail the 
intersection of the proposed more inclusive finance charge and these 
other rulemakings. See 77 FR 51116, 51144-46.
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    Based on informal feedback received by the Bureau since publishing 
the TILA-RESPA Integration Proposal, the Bureau now believes that it is 
appropriate to provide additional time for commenters to provide their 
views on the proposed changes to the definition of the finance charge. 
The Bureau recently published proposed rules related to HOEPA 
protections and mandatory appraisals for certain higher-risk mortgages; 
those proposals discuss certain means of reconciling an expanded 
definition of the finance charge with coverage thresholds that depend 
on the finance charge or APR. The Bureau understands that commenters 
may need additional time to evaluate the proposed more inclusive 
finance charge in light of these proposals, as well as prior proposed 
rules published by the Board related to qualified mortgages and 
mandatory escrow accounts that discuss similar issues. In particular, 
the TILA-RESPA Integration Proposal specifically requests data that 
will allow the Bureau to perform a quantitative analysis to determine 
the impacts of a broader finance charge definition on the coverage 
thresholds for these other regimes. The Bureau understands that such 
data collection may require additional time and that commenters may 
wish to evaluate any data they collect when preparing their comments.
    For these reasons, the Bureau is extending the comment period for 
the proposed changes to Sec.  1026.4 in the TILA-RESPA Integration 
Proposal to November 6, 2012. In light of this extended comment period 
and the subsequent, necessary analysis of comments and data received, 
the Bureau does not expect to address any proposed changes to Sec.  
1026.4 until after the Bureau has met its deadlines to issue final 
rules to implement requirements of the Dodd-Frank Act that would 
otherwise take effect on January 21, 2013. Instead, the Bureau expects 
to address the proposals to expand the finance charge when it finalizes 
the disclosures in the TILA-RESPA Integration Proposal.
    The comment period for the proposed changes to Sec.  1026.1(c) 
concerning certain disclosure requirements under the Dodd-Frank Act, 
which ends September 7, 2012, is unchanged. In addition, the comment 
period for all other aspects of the TILA-RESPA Integration Proposal 
containing proposed amendments, which ends November 6, 2012, is 
unchanged. In a separate notice, the Bureau is also extending to 
November 6, 2012, the comment period for the portions of the Bureau's 
HOEPA Proposal regarding whether and how to account for the 
implications of a more inclusive finance charge on the scope of HOEPA 
coverage. If the Bureau expands the definition of the finance charge, 
the Bureau will at the same time address the proposals to adjust the 
coverage thresholds that depend on the finance charge or the APR in the 
HOEPA Proposal and the other proposed rules implementing title XIV of 
the Dodd-Frank Act. The Bureau continues to encourage commenters to 
submit comments during the relevant comment periods.

    Dated: August 30, 2012.
Richard Cordray,
Director, Bureau of Consumer Financial Protection.
[FR Doc. 2012-22000 Filed 9-5-12; 8:45 am]
BILLING CODE 4810-AM-P