BCFP Issues Updated Small Entity Compliance Guides for the Loan Originator Rule and the HOEPA Rule

The Bureau of Consumer Financial Protection issued updates to its small entity compliance guides for the Loan Originator Rule and the Home Ownership and Equity Protection Act (HOEPA) Rule.  The guides are intended to provide simple summaries of the BCFP’s regulations and highlight issues which may affect smaller loan originators and creditors.

The Loan Originator Rule governs such things as defining who is a loan originator, loan originator compensation, recordkeeping, qualifications, and compliance policies and procedures.  The updates to the Loan Originator Rule guide address 1) new exemptions from the rule for retailers of manufactured homes and their employees; 2) the process for contacting the Bureau with informal inquiries about the Loan Originator Rule; and 3) changes due to the TILA-RESPA Integrated Disclosure Rule (TRID) having taken effect since the publication of the prior version of this guide.

The HOEPA Rule applies to certain types of high-interest rate or high-fee loans, including purchase-money mortgages, refinances, closed-end home equity loans, and home equity lines of credit.  The rule requires that lenders give additional disclosures, avoid certain loan terms, and ensure that consumers receive additional protections, including homeownership counseling.  The updates to the HOEPA Rule guide address 1) the process for contacting the Bureau with informal inquiries about the rule; 2) broadening an exemption for manufactured home retailers regarding what loan originator compensation must be included when calculating points and fees; and 3) clarification on effective dates.