Len Bernstein, chair of Reed Smith’s Financial Services Regulatory Group and Managing Partner of the firm’s Philadelphia office, was recently quoted by the Legal Intelligencer regarding the extensive preparation regulatory lawyers and the mortgage industry have done to assist mortgage lenders and servicers in dealing with the changes in the regulatory landscape largely effective in January 2014.
The Consumer Financial Protection Bureau (“CFPB”) began its mortgage regulatory avalanche in early 2013 with the issuance of the highly anticipated amendments, mostly to Regulation X and Regulation Z, the implementing regulations for the Real Estate Settlement Procedures Act and the Truth-in-Lending Act, respectively. Throughout the year, the CFPB issued a flurry of additional amendments to these regulations that take effect in January 2014 (except for the November implementation of the Integrated Mortgage Disclosure, which is August 2015). Reed Smith’s regulatory lawyers have spent much of 2013 digesting the hundreds, if not thousands, of pages of CFPB preambles, commentary, press releases, and informal guidance, in assisting their clients in developing innovative solutions to the inevitable challenges presented by the new regulations.
Some of the work Reed Smith has done to prepare its clients includes a four-part webinar addressing such issues presented by the new rules as: mortgage loan servicing standards, the Qualified Mortgage rule, the Ability-to-Repay rule, loan originator compensation, escrow requirements, new appraisal rules, and higher-priced loan requirements. The Reed Smith team has also given lectures on these issues for trade associations, as well as individualized presentations specifically designed to address the needs of its clients.