The Consumer Financial Protection Bureau today invited comments on new agency procedures by which businesses can appeal the CFPB’s designation of a rural or underserved area. The proposal implements a regulatory relief measure long advocated by ABA that Congress passed in December.
The Dodd-Frank Act gave the CFPB discretionary authority to exempt certain loans from the qualified mortgage rule for banks serving areas that it deems “rural” or “underserved.” Given the CFPB’s struggle to appropriately define what constitutes rural or underserved, and the significant impact that the designation — or lack thereof — can have on small lenders and their customers, ABA urged Congress to require a formal process by which banks can appeal for rural or underserved status.
Since Congress imposed a 90-day deadline to institute the new appeals process, the CFPB is expediting OMB and other clearances and plans to issue enabling procedural rules by March 3. The CFPB will accept comments for 60 days after the notice is published in the Federal Register.