Greetings from the Manchester Grand Hyatt in sunny San Diego, CA!  The locals say we are in the middle of the “June Gloom” with some hazy weather but there is plenty of energy at the ABA regulatory compliance gathering.  Hundreds in the banking compliance community have come together to share knowledge and make connections with other like-minded professionals.  As always, the ABA puts on a premier event with offerings in subjects across the entire spectrum of banking regulation.   Between the beginning of the conference on Sunday and closing sessions on Wednesday, vital information will be shared and as always you can rely on Compliance Resource to keep you up to date.

At lunch today, I had the chance to meet and catch up with other members of our Compliance Master’s Group who are in attendance.  We shared stories of the challenges we are all facing during this crazy time of regulatory compliance.  It was great fun to get together in person with people we have interacted with online in our group for so long!

The sessions I attended today provided great information; one that I found particularly interesting was “Top TRID Issues and What you Can Do About Them”.  We still have so many questions about TRID and are still trying to grasp any additional information we can.  The panelists included Richard Horn – Richard Horn Legal, PLLC, Betsy Fredrickson, CRCM – Vice President Wells Fargo Bank, Brian Levy – Of Counsel, Katten & Temple, LLP, and Rod Alba – SVP American Bankers Association.

Some of the topics discussed included the administrative, contractual, and civil liability that may arise as a result of the lack of regulatory clarification.  In addition, the panelists provided us a list of hot TRID issues that we still have multiple questions about and would like to see addressed in the anticipated proposal to the regulation:

• Expediting Receipt – Can you rely on a receipt of overnight delivery of the Loan Estimate or Closing Disclosure? How do you prove the applicant/borrower actually received the disclosure?
• No Cost Loans/Lender Credits
• Fee Names – There is no common fee “naming” convention within the industry. Can a fee name change from the Loan Estimate to the Closing Disclosure?
• Simultaneous Title Insurance Issuance
• “Black Hole” – The panelists referred to this as the allowance for changes to be made to the Closing Disclosure if a change occurs less than four business days prior to consummation. In addition, can a changed circumstance occur in the period of time after a Closing Disclosure is delivered?

One of the most interesting elements of the presentation included comments from Rod Alba of ABA who stated that even though statistics imply that consumers understand the disclosures better than the previous Good Faith Estimate and HUD-1, the ABA still questions those statistics.  The ABA’s goal is to have an “informed consumer base that allows for the ability to comply”.

Mr. Alba went on to state the expectations of the ABA in regard to the proposed rule expected to be released in late July:

• ABA anticipates that if the proposal is released in late July as promised by the CFPB, the final rule would be available at the end of January at the earliest.
• Based on the ABA’s conversations with the CFPB, the expectations for what will be covered in the proposed rule will likely include: liability issues regarding cure provisions, the “black hole”, and the CFPB webinar items that have been addressed in recent months.

The ABA’s continued message to the CFPB is that a mechanism needs to be developed to communicate more frequently with the industry to ensure clarification of the regulation.  In addition, the ABA is requesting that the period of forbearance during exams initially requested of the regulatory agencies by Richard Cordray needs to be extended until at least the end of the proposal period of the regulation.

Probably the most powerful message spoke by the ABA leader as a response to a question regarding construction loans was the hope that the proposal will not include any information on construction lending as the ABA will continue to work to get construction loans excluded from the regulatory requirements of TRID.

We will continue to keep you informed of the latest information from the ABA RCC, in the meantime, keep your head afloat!

Kelly Owsley