Truth in Lending (Regulation Z)
Federal Register, Volume 81 Issue 146 (Friday, July 29, 2016)
Federal Register Volume 81, Number 146 (Friday, July 29, 2016)
Rules and Regulations
Page 49869
From the Federal Register Online via the Government Publishing Office www.gpo.gov
FR Doc No: 2016-18050
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BUREAU OF CONSUMER FINANCIAL PROTECTION
12 CFR Part 1026
Truth in Lending (Regulation Z)
CFR Correction
In Title 12 of the Code of Federal Regulations, Parts 1026 to 1099, revised as of January 1, 2016, on page 749, in supplement I to part 1026, under section 1026.41,the heading 41(e)(5) Consumers in bankruptcy and paragraphs 1, 2, and 3 are added to read as follows:
Supplement I to Part 1026--Official Interpretation
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Section 1026.41 Periodic Statements for Residential Mortgage Loans
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41(e)(5) Consumers in bankruptcy.
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Commencing a case. The requirements of Sec. 1026.41 do not apply once a petition is filed under Title 11 of the United States Code, commencing a case in which the consumer is a debtor.
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Obligation to resume sending periodic statements. i. With respect to any portion of the mortgage debt that is not discharged, a servicer must resume sending periodic statements in compliance with Sec. 1026.41 within a reasonably prompt time after the next payment due date that follows the earliest of any of three potential outcomes in the consumer's bankruptcy case: the case is dismissed, the case is closed, or the consumer receives a discharge under 11 U.S.C. 727, 1141, 1228, or 1328. However, this requirement to resume sending periodic statements does not require a servicer to communicate with a consumer in a manner that would be inconsistent with applicable bankruptcy law or a court order in a bankruptcy case. To the extent permitted by such law or court order, a servicer may adapt the requirements of Sec. 1026.41 in any manner believed necessary.
ii. The periodic statement is not required for any portion of the mortgage debt that is discharged under applicable provisions of the U.S. Bankruptcy Code. If the consumer's bankruptcy case is revived--for example if the court reinstates a previously dismissed case, reopens the case, or revokes a discharge--the servicer is again exempt from the requirement in Sec. 1026.41.
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Joint obligors. When two or more consumers are joint obligors with primary liability on a closed-end consumer credit transaction secured by a dwelling subject to Sec. 1026.41, the exemption in Sec. 1026.41(e)(5) applies if any of the consumers is in bankruptcy. For example, if a husband and wife jointly own a home, and the husband files for bankruptcy, the servicer is exempt from providing periodic statements to both the husband and the wife.
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FR Doc. 2016-18050 Filed 7-28-16; 8:45 am
BILLING CODE 1505-01-D
