Industry NewsMortgage

Rules clarify how lenders should provide housing counseling information to consumers

Final interpretive rule provides guidance on Dodd-Frank requirements

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The Consumer Financial Protection Bureau has released its final interpretation of a regulation that outlines mortgage lenders' duty to provide mortgage applicants with housing counselor information. The Dodd-Frank Wall Street Reform and Consumer Protection Act requires mortgage lenders to give borrowers lists of local housing counselors shortly after they apply for a mortgage so they know where to get help when deciding the best loan product for them. Lenders may fulfill this requirement by using CFPB-developed housing counseling lists, which are available through an online tool the bureau created in 2013, or by generating their own lists using the same Department of Housing and Urban Development data that the CFPB uses to build its lists. The CFPB’s tool uses a third-party, commercially available geolocation tool to match counseling organizations to a ZIP code. A lender is not required to use the same geolocator or geocoding system as the bureau as long as the results are g...