Consumer Financial Services Committee Newsletter — March 2020

 

In This Issue

Consumers

Leadership Message

If you’re reading this message, it means you’re currently a member of the Consumer Financial Services Committee. And we’d like to keep it that way! Not only do we want to convince you that your own membership is worthwhile, but we want you to love it so much that you convince others to join too. But maybe, lately, you’re feeling a bit ambivalent about the benefits of membership. There are lots of other organizations that offer CLEs, access to resources, and professional development, so what’s so great about the ABA? Let me count the ways.

Consumers

Panel Spotlight: Whither the Housing Market—GSE Reform and QMs

At the CFSC 2019 Winter Meeting, the Truth in Lending & Housing Finance Subcommittee presented a panel entitled, “Whither the Housing Market? Proposed Changes to the GSE’s and Qualified Mortgage Rules.” The panel was moderated by Lauren Campisi of McGlinchey Stafford PLLC, and both Ken Markison of Weiner Brodsky Kider PC and Rich Horn of Garris Horn, PLLC were speakers on the panel. The panel considered the “Patch” or “Temporary GSE QM” in the context of the Qualified Mortgage/Ability to Repay (“QM/ATR”) rule, the implications of the Consumer Financial Protection Bureau’s (“CFPB’s”) intention to allow the Patch to sunset on January 10, 2021, and the Patch’s relationship to Government-Sponsored Enterprise (“GSE”) reform.

Consumers

Small Business Lending Issues—Complying With New Laws That Require Consumer Type Disclosures

On January 1, 2019, a law in California went into effect that requires “providers” of “commercial financing” to furnish certain disclosures to “recipients” at the time of extending a specific offer of commercial financing. On May 1, 2019, the New York State Senate introduced Senate Bill 5470 (“SB5470”), which would require similar commercial financing disclosure requirements. Financial service providers subject to the California law should take a proactive compliance approach and consider providing the disclosures to recipients of commercial financing made in all the states in which the financial service provider funds loans and advances, as other states may follow California’s lead and pass similar laws.

Consumers

Truth in Lending & Love: The Statute of Limitations of a 15 U.S.C. § 1643 Claim

In a recent ruling by the Northern District of Texas, Jolly v. JPMorgan Chase & Co., the court considered when a cause of action under 15 U.S.C. § 1643 of the Truth in Lending Act (“TILA”) accrues for limitations analysis. After identifying a circuit split on the issue, the court suggested that the limitations clock for a claim under section 1643 could depend on not just the date of a lender’s notification to a borrower it will not remove a purportedly unauthorized charge, but the substance and quality of the lender’s notification to the borrower (i.e. whether the notification was “clear and unequivocal”).

Consumers

The Proposed Debt Collection Rule & State Collection Laws

In May 2019, the Consumer Financial Protection Bureau (“CFPB”) published a proposed debt collection rule (Regulation F) under the federal Fair Debt Collection Practices Act (“FDCPA”) to provide much-needed guidance on how a statute enacted in 1977 applies to modern debt collection practices. Since May, practioners have understandably focused on digesting the proposed rule, identifying potential challenges presented by the rule, and verifying the scope of the rule. Another important step for practitioners in processing the impact of the proposed rule is to understand how the proposed rule interacts with state collection laws.