Federal Reserve Board Proposes Repeal of S.A.F.E. Act Regulations

On September 21, 2018, the Federal Reserve Board proposed to repeal two regulations that implement the Secure and Fair Enforcement for Mortgage Licensing Act of 2008, otherwise known as the S.A.F.E. Act.  The SAFE Act was passed in 2008 and mandates a nationwide licensing and registration system for residential mortgage loan originators.

Originally, the S.A.F.E. Act requirements were implemented through a coordinated rulemaking from the federal banking agencies (and the Farm Credit Administration) as these were the agencies with authority over the federal registration requirements under the S.A.F.E. Act.  Eventually, the Federal Reserve Board incorporated the S.A.F.E. Act into their Regulation H (part 208, Subpart I) as well as Regulation K (211.24(k)).

With the passing of the Dodd-Frank Act, S.A.F.E. Act rulemaking authority was transferred to the CFPB.  This means that the Federal Reserve Board’s rule is “substantially duplicate” and, therefore, the Board has published a proposal to repeal its  regulations that originally incorporated the S.A.F.E. Act.

This change should not have an impact on most financial institutions.

The full proposal can be found here.

FinCEN Advisory on High-Risk Customers

Denial Reasons of Excessive Obligations & Insufficient Income

Denial Reasons of Excessive Obligations & Insufficient Income