FDIC Amends Rules Governing Real Estate Lending Standards
FDIC adopted the final rule to amend certain sections of the existing FDIC regulations governing real estate lending standards. The rules are applicable to all insured depository institutions for which the FDIC is the appropriate Federal banking agency. The final rule rescinds and removes the “Lending and Investment” regulations and “Registration of Residential Mortgage Loan Originators” regulations. The regulations related to the registration of residential mortgage loan originators have been amended because the supervision and rulemaking authority in this area was transferred to CFPB by the Dodd-Frank Act. The final rule is effective on July 31, 2019.
Earlier, FDIC had issued the notice of proposed rulemaking with a sixty-day comment period, which closed on April 08, 2019. FDIC received no comments on the proposal and, consequently, the final rule is being adopted without change. The final rule covers the following key changes:
- 12 CFR part 390, sub-part P is being rescinded in its entirety because other existing FDIC regulations concerning permissible activities, safety and soundness standards, and real estate lending standards replicate the current requirements of part 390, subpart P.
- To clarify that part 365 applies to all institutions for which FDIC is the appropriate Federal banking agency, FDIC is amending sections 365.1 and 365.2 of part 365 to replace the phrases “insured state nonmember banks (including state-licensed insured branches of foreign banks)” and “state nonmember bank” throughout sub-part A with the phrase “FDIC-supervised institution.” In addition, section 365.1 is being revised to add the definition of the term “FDIC-supervised institution” to mean any insured depository institution for which FDIC is the appropriate Federal banking agency.
- FDIC rescinded subpart B of part 365, which relates to registration requirements for residential mortgage loan originators, due to the CFPB's issuance of Regulation G pursuant to the CFPB's authority under the Dodd-Frank Act.
Related Link: Final Rule
Effective Date: July 31, 2019
Keywords: Americas, US, Banking, Residential Mortgage, Dodd-Frank Act, Residential Real Estate, Loan Origination, FDIC
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