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CFPB GRANTS
BANK OF
AMERICA
NO-ACTION
LETTER
e Consumer Financial Protection
Bureau (CFPB) has granted a no-action
letter (NAL) to Bank of America, N.A.
regarding the bank's funding arrangements
with housing counseling agencies (HCAs)
certified by the U.S. Department of Housing
and Urban Development (HUD). NALs
provide increased regulatory certainty through
a statement that the Bureau will not bring a
supervisory or enforcement action against a
company for providing a product or service
under certain facts and circumstances.
e CFPB issued a revised NAL Policy
in September 2019, which improved on
the Bureau's 2016 NAL Policy by having,
among other things, a more streamlined
review process focusing on the consumer
benefits and risks of the product or service in
question. According to the CFPB, regulatory
uncertainty can "hinder the development" of
innovative products and services that benefit
consumers.
NALs provide increased regulatory
certainty through a statement that the
CFPB will not bring a supervisory or
enforcement action against a company for
providing a product or service under certain
circumstances.
"e new NAL Policy improves on the
Bureau's 2016 NAL Policy by having, among
other things, a more streamlined review
process focusing on the consumer benefits and
risks of the product or service in question."
the CFPB says.
Basing its application on the template
the Bureau approved in response to HUD's
request, Bank of America applied for a NAL
to facilitate funding arrangements with
HCAs.
e CFPB's first NAL under the
new policy is in response to a request by
the Department of Housing and Urban
Development (HUD) on behalf of more than
1,600 housing counseling agencies (HCA)
that partake in HUD's housing counseling
program.
HUD discussed concerns in 2018 to the
CFPB about the HCAs and lenders not
entering into agreements that would fund
counseling services due to uncertainty of
the Real Estate Settlement Procedures Act
(RESPA).
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