Throughout the year, League staff research regulatory compliance questions posed by member credit unions and disseminate the answers. Educational sessions are held periodically to reinforce information distributed through InfoSight and Compblog Updates, as well as other written information.
Mortgage Disclosure Rule gets Tweaked by CFPB
The Consumer Financial Protection Bureau (CFPB) finalized minor modifications to rules governing when consumers receive loan information. The rules, first proposed in October, address when consumers will receive updated disclosures after locking in an interest rate, and how consumers receive information regarding certain construction loans.
One change requires creditors provide a revised Loan Estimate within three business days after a consumer locks in a floating interest rate. The original rule required creditors to provide the revised Loan Estimate on the date the rate is locked.
The second change creates a space on the Loan Estimate form where creditors could include language informing consumers that they may receive a revised Loan Estimate for a construction loan that is expected to take more than 60 days to settle.
Both changes are part of the bureau’s Truth in Lending Act-Real Estate Settlement Procedures Act Integrated Disclosure rule , which becomes effective Aug. 1. According to the CFPB, it does not anticipate that the modifications will affect the industry’s ability to come into compliance with the rules. (CUNA News Now)
IRAs and HSAs in 2015
The new year brings questions about what changes have gone into effect that impact IRAs and HSAs, as well as what new compliance challenges and opportunities can be expected.Although it’s too early to know what unexpected changes might come as a result of a new Congress—rest assured there are plenty of twists and turns in store.
As of January 1, 2015, IRA owners may complete only one IRA rollover in any 12-month period, regardless of how many IRAs they own. This is a big change from the previous rule that allowed IRA owners to rollover one distribution per IRA that they owned during any 12-month period. There are huge tax and penalty implications, and there is no way to tell which members are using the old practice. The best way to protect your credit union is to amend your IRA disclosure statements as soon as possible to inform your members of the change.
While there are no changes in HSA reporting or rules for 2015, the sheer number of credit unions entering the HSA space is raising many questions throughout the credit union market on how best to handle offering HSAs. In 2013, twice as many banks offered HSAs versus credit unions, creating a void in the product set for many existing and potential credit union members. In addition, HSAs also have become a cornerstone of many health plans offered through the federal and state-run healthcare exchanges. (CU Insight)
CFPB Oks Online Privacy Notices
A rule allowing financial institutions that meet certain requirements to post annual privacy notices online has been finalized by the Consumer Financial Protection Bureau (CFPB).
The Gramm-Leach-Bliley Act (GLBA) requires financial institutions to send annual privacy notices to customers, describing whether and how it shares consumers’ nonpublic personal information. If the institution does share this information, it must notify consumers of their right to opt out and inform them how to do so.
The new rule applies to all financial institutions within the CFPB’s jurisdiction under the GLBA. Institutions that choose to rely on this new method of delivering privacy notices will be required to use the model disclosure form developed by federal regulatory agencies in 2009.
Under the CFPB’s new rule, requirements that allow financial institutions to post privacy notice online include:
If an institution chooses not to use the new disclosure method, it will need to continue to deliver annual privacy notices to its customers using other delivery methods. (CUNA News Now)
NCUA to Publish Vendor List
The National Credit Unions Administration’s Office of Small Credit Union Initiatives will add a list of credit union-recommended vendors to its services.
“We’re piloting this service to help you generate time- and cost-efficient leads for delivering member services,” the agency wrote in a newsletter posting about the new service. “Through this service credit unions can obtain contact information on registered vendors that serve credit unions.”
The list will be “unbiased” the agency said, and will be free to both users and vendors. NCUA Board Chairman Debbie Matz said she would support seeking authority for the NCUA to regulate credit union vendors. (CU Times)
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