CFPB Updates Agency Contact Information in Various Disclosures and Regulations
On March 17, 2023, the Consumer Financial Protection Bureau (“CFPB”) issued a Final Rule that makes non-substantive updates to the CFPB and other Federal agency contact information found in various regulations and required disclosures. Most notably, these updates affect the adverse action notice required under the Equal Credit Opportunity Act (“ECOA”).
Equal Credit Opportunity Act
The Final Rule updates Appendix A, which contains the Federal agency contact information that creditors must include in the adverse action notice under ECOA. Eight Federal agencies requested the CFPB update their contact information. Mandatory compliance for the updated notice is March 20, 2024, but entities are encouraged to implement the updates at the earliest feasible date.
The Final Rule also updates the CFPB’s own contact information in various regulations including, but not limited to:
(1) Regulation F, which implements the Fair Debt Collection Practice Act
(2) Regulation E, which implements the Electronic Fund Transfer Act
(3) Regulation X, which implements the Real Estate Settlement Procedures Act
(4) Regulation Z, which implements the Truth in Lending Act
The comment in Appendix J to Regulation Z is updated to add a website address where the public can access a new CFPB website that contains APR tables applicable to closed-end credit transactions, rather than requesting tables from the CFPB.
CFPB Updates APOR Methodology
On April 14, 2023, the Consumer Financial Protection Bureau (“CFPB”) announced a revised methodology for determining average prime offer rates (“APOR”). The revised methodology was necessary due to certain data becoming unavailable that the CFPB previously used in its calculation.
Most importantly, the CFPB will continue to post its APOR tables. The updated APOR methodology simply changes the way the CFPB calculates its APORs.
USDA Announces New Conflict of Interest Prohibition
Effective March 31, 2023, the Single Family Housing Guaranteed Loan Program Revised Handbook-1-3555, which applies to USDA loans. Lenders making USDA loans must now ensure no employee involved in the loan transaction has multiple roles in the transaction – i.e., a conflict of interest.
Moreover, Chapter 4 of Handbook 1-3555 addresses lender responsibilities. One such responsibility requires a lender to “operate responsibly” which includes avoiding conflicts of interest with additional details on how to do so.