CFPB Delays TILA-RESPA Integrated Disclosure Rule

Administrative error leads agency to push back effective date to Oct. 3, 2015.

September 1, 2015

On June 24, 2015, the Consumer Financial Protection Bureau (CFPB) issued a proposed rule to delay until Oct. 3, 2015, the effective date of the TILA-RESPA integrated final rule and amendments.

According to the proposed rule, a bureau administrative error in complying with the Congressional Review Act (CRA) meant the final rule couldn’t take effect until at least Aug. 15, 2015—two weeks past the intended effective date.

Section 801 of the CRA requires a government agency to submit a rule report, which includes a copy of the rule, to each house of Congress and to the Government Accountability Office (GAO) comptroller general. Under the CRA, a rule can’t take effect until 60 days after the Federal Register publishes it, or 60 days after Congress receives the rule report, whichever is later.

Although the Federal Register published the TILA-RESPA final rule on Dec. 31, 2013, the CFPB recently discovered it hadn’t submitted its rule report as required. Upon discovering its error, the bureau submitted the rule report to both houses of Congress and the GAO on June 16, 2015.

In the proposal, the bureau requested comments regarding the proposed extension of the effective date to Oct. 3, 2015, as well as alternative extension dates. One option would have allowed the rule to take effect on the CRA effective date of Aug. 15, 2015.

After a nearly two-week comment period, followed by a two-week period for reviewing comments, the CFPB issued a final rule on July 21, 2015. The rule delays the effective date of the TILA-RESPA final rule and amendments to Oct. 3, 2015, and finalizes the related technical amendments in the proposed rule.

The agency opted for Oct. 3 rather than Aug. 15 for a number of reasons. Among those reasons, the CFPB expressed concern that a mid-month effective date would pose implementation challenges and provide limited time to fully test all systems and components to ensure they work together in a manner that enables creditors to maintain compliance with the rule.

The final rule also includes technical corrections to two provisions that affect sums listed on the closing disclosure. Lenders should:

  1. Include the amount disclosed for certain personal property sales in the amount disclosed as “final” for adjustments and other credits; and
  2. Include lender credits in the amount disclosed as closing costs paid at closing.

The final rule doesn’t provide a safe harbor period for legal liability and enforcement through the end of the year, as CUNA requested in its comment letter on the proposed rule. CUNA will continue to pursue a safe harbor period through 2015.

Restrained enforcement

On more than one occasion, CFPB Director Richard Cordray has stated the CFPB initially will practice restrained enforcement of the TILA-RESPA rule’s requirements.

“Our oversight of the implementation of the rule will be sensitive to the progress made by those entities that have squarely focused on making good-faith efforts to come into compliance with the rule on time,” he said.

In a July hearing before the Senate Banking Committee, when asked how the CFPB would enforce the TILA-RESPA integrated rule, Cordray stated that early examinations “will be diagnostic and corrective.”

According to Cordray, lenders aren’t looking to “exploit consumers.” Rather, “they’re just trying to get it right. And so for the first period, which may last many months, the other agencies and ourselves as we work on this, if we see errors, we will point out what they are and how they should be corrected. We will not be looking to be punitive to people.”

Cordray’s comments reflect the CFPB’s understanding that compliance with the complex TILA-RESPA integrated rule might be difficult at first, but that the CFPB and other agencies, such as NCUA, will make an effort to help creditors experiencing problems.

This is good news for credit unions and other creditors as the new Oct. 3, 2015, effective date approaches rapidly.

MICHAEL McLAIN is CUNA’s senior federal compliance counsel. Contact him at 608-231-4185 or at