Dodd-Frank News Center

Comments on Reg. Z Ability-to-Repay Regulations

 This story appeared in Bank Digest.

The Federal Reserve Board has proposed amendments to Reg. Z--Truth in Lending (12 CFR 226) that would set out how residential mortgage lenders would be required to determine a consumer's ability to repay a mortgage. The proposal would define what are termed “qualified mortgages” and also set minimum underwriting standards for many mortgages. The proposed amendments, which are required by the Dodd-Frank Act, also would implement limits on prepayment penalties and attempt to prevent lenders from evading the rules. 

FDIC Issues Policy Statement on Private Capital Investments

By Richard Roth, J.D., Editor, the CCH Federal Banking Law Reporter, CCH Bank Compliance Guide and Bank Digest.

The Federal Deposit Insurance Corp. has approved a Statement of Policy on the Acquisition of Failed Insured Depository Institutions that provides guidance to private capital investors interested in acquiring or investing in the deposit liabilities of failed banks or thrifts. The final statement includes a number of changes from the proposed statement issued in July, such as refining the description of the types of investors covered, changing the capital standard to one that is intended to be a better measure of the capital available to absorb losses and clarifying the circumstances in which the cross support obligation would apply.  The statement is intended to open the door to additional sources of the capital needed to support the industry as the agency is called upon to take over more institutions.