Despite the fact that the rule covers a wide breadth of loans and affects most of the industry, there is still a lack of clarity within these new regulations. As NAFCU's director of regulatory compliance, I've received myriad questions from our credit union members on a variety of topics, including where certain fees should be entered on the forms, the difficulties in offering no-cost loans, and what to do if there is a last-minute change – particularly after the closing disclosure has been provided.

As much as I'd like to give exact answers to the questions I'm hearing, it's not that easy. For one, completing the disclosure forms is a complex and technical process that NAFCU has asked the CFPB to clarify – with mixed results. Unlike other federal regulators, the CFPB does not offer formal legal opinion letters or staff advisory opinions formalizing interpretations of unclear rule writing. Rather, other than a few webcasts that only addressed a few of the dozens of TRID ambiguities, the bureau will only provide informal, nonbinding information by phone.

For example, one of many "unanswered questions" involves the calculation of owner's and lender's title insurance. There is a glaring problem in regard to how these fees are computed and disclosed under TRID. Specifically, the rule contains a formula that does not always account for how title insurance is priced, particularly in states when there are significant discounts when an owner's policy and lender's policy are purchased simultaneously. In some instances, the formula can yield a negative fee for title insurance, which is inaccurate in terms of true costs and seems likely to confuse consumers. While the issue has been made known to the CFPB, no changes have been made yet to address this problem in the rule, nor has the bureau publicly clarified that a negative number is an acceptable disclosure for owner's title insurance.

Unfortunately, the issues surrounding this rule don't stop there. NAFCU, as well as other groups, has pointed out a conflict in timing requirements for the rule's loan estimate and closing disclosure that could leave lenders in a costly situation. TRID prohibits closing until seven business days after the loan estimate is provided to the applicant. Once this seven-business-day period has elapsed and the parties move forward with the closing, the credit union, in most cases, must provide the closing disclosure no later than three business days before consummation of the transaction.

Sometimes, a borrower may request a change in the loan product or the terms of the loan at the 11th hour. Lenders are concerned that where a change is requested at the last minute, there may be no way that a lender could satisfy both the rule and the consumer's request. In some cases, a revised closing disclosure triggers a new three-day waiting period. This could mean a consumer may have to choose between the closing date they need and the rate lock or other term that they want. Alternatively, credit unions may end up absorbing costs so their members do not have to make such a choice.

NAFCU has requested more specific guidance from the CFPB on each of these points and others and will keep members apprised.

Brandy Bruyere is director of regulatory compliance for NAFCU. She can be reached at 703-842-2221 or [email protected].