Date: 2015-10-07
Speaker: MAXINE WATERS (democrat)
Chamber: H
State: California

Mr. Speaker. I yield myself 5 minutes for an opening statement. I rise today in opposition to H.R. 3192. a proposal that I believe erodes consumers ability to have their day in court and that undermines efforts to comply with the CFPBs new TILARESPA Integrated Disclosure act. When I say TILA and RESPA. I am talking about the Truth in Lending Act and the Real Estate Settlement Procedures Act. Mr. Speaker. I stand in full support of the Consumer Financial Protection Bureaus decision to engage in restrained enforcement of the new disclosure rules until 2016. and I support the FFIECs recent announcement that prudential regulators supervision of financial institutions compliance with the new rules will recognize the scope and scale of the changes necessary for financial institutions and other affected entities to effectively comply. Simply speaking. when the business community and Democrats and Republicans all basically said. "We believe that these integrated rules are complicated. It is going to take industry time to get up to speed." they have got to change their paper. They have got to train their employees. et cetera. et cetera. We all agree that there should be a grace period. So. with that. my support for a temporary period of restrained administrative enforcement and supervision reflects the recognition of the massive undertaking that lenders and other settlement providers have undergone in preparation for the new disclosure rules. Now. given the administrative liability that lenders would face under both the Real Estate Settlement Procedures Act and the Truth in Lending Act. I fully understand the real concerns that affected entities have. given the scale and scope of the changes called for under the new disclosure rules. Mr. Speaker. industry requests to date that the Bureau and other Federal regulators take a more thoughtful approach with respect to their enforcement and supervision is reasonable. My support for the actions taken to date by regulators to consider good faith compliance efforts by lenders and other entities affected by the new disclosure rules does not. however. extend to suspending. even temporarily. one of the more important consumer protections available to the Truth in Lending Act. which is a consumers right to bring an action protecting themselves in the event that a lender makes an inaccurate. untimely. misleading disclosure. Basically. what we are talking about now is who is going to protect the consumer in all of this. We are saying that there is a need to protect consumers. Those who oppose the amendment that I tried to bring to the floor to do just that are saying they are not on the side of the consumer. While the good faith provision in H.R. 3192 does allow consumers to bring actions in response to egregious violations of the Truth in Lending Act. consumers can still rely on inaccurate or misleading disclosure errors that are made in good faith. Under current law. borrowers can bring an action where a disclosure is inaccurate or misleading. even if the error is made in good faith. and the burden under current law is on the lender to prove that their disclosure is consistent with the Truth in Lending Act. Now we have a change. In contrast. under H.R. 3192. this legislation. the burden is placed on the consumer to demonstrate from the onset of an action that the error was not made in good faith. a bar that is virtually impossible for most consumers to overcome. That is a drastic departure from current law. The private right of action under the Truth in Lending Act serves two important purposes: First. it allows consumers to protect themselves from inaccurate. untimely. or misleading mortgage disclosures. Second. through the acts provision of statutory and classaction damages. as well as attorneys fees and court costs. TILA also provides clear incentives for lenders to ensure that the disclosures they provide are timely and accurate. I just want to take a look at what the TILARESPA Integrated Disclosure would require. Let us take a look at what we are talking about. In this document. they identify the amounts for the loan. the interest rates. the monthly principal and interest. whether or not there are prepayment penalties. whether or not there is a balloon payment. on and on and on. It gets down to exactly what is being disclosed to the consumer. Mr. Speaker. I reserve the balance of my time.