SFIG Publishes RMBS 3.0 TRID Compliance Review Scope © Documentation

Today, June 15th, SFIG published its RMBS 3.0 TRID Compliance Review Scope© documentation, developed under the leadership of members from Third Party Review (“TPR”) firms across the industry and SFIG’s RMBS 3.0 Due Diligence, Data and Disclosure Working Group. The document was created with an aim to facilitate a uniform testing standard as a result of a consistent Truth-In-Lending Act liability interpretation according to our understanding of prevailing legal precedent and informal written guidance and webinars offered by the CFPB, as it applies to the Know Before You Owe / Truth In Lending Act (“TILA) – Real Estate Settlement Procedures Act (“RESPA”) Integrated Disclosure (“TRID”) Rule (78 FR 79730, as amended) across TPR firms.

The underlying premise of this documentation is to establish a best practices approach to pre-securitization testing logic that will drive the due diligence conducted by TPRs, however, the conclusions set forth in the document do not necessarily reflect how courts and regulators, including the CFPB, may view liability for TILA violations presently, or in the future. SFIG and its membership continue to work with the Consumer Financial Protection Bureau (“CFPB”) toward the goal of providing formal guidance for the benefit of the consumer, primary, and secondary mortgage markets.

In anticipation of the Grid requiring occasional revision, SFIG will conduct regular quarterly meetings to subject any member recommended revisions to review and evaluation. However, if a rule revision or court decision requires immediate and significant revision to the Grid, in the view of affected membership, then we require an ad hoc meeting to be convened to review such revision. All meetings, and the Grid itself, will be under the auspices of the RMBS 3.0 Due Diligence and Data Disclosure work stream and subject to the same protocols as other RMBS 3.0 work streams and work product. For questions about the TRID documentation and SFIG’s engagement with the CFPB, please contact Daniel.Goodwin@sfindustry.org. To join any of SFIG’s RMBS 3.0 working groups, please contact Dallin.Merrill@sfindustry.org or William.Innes@sfindustry.org.

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