WASHINGTON—The CFPB Thursday released several resources and a notice of proposed rulemaking in an effort to ease the transition away from the London Inter-bank Offered Rate (LIBOR) for consumers and regulated entities.
LIBOR is set to stop publishing after 2021 and the Secured Overnight Financing Rate (SOFR) has been identified as its alternative.
For consumers, the Bureau released an updated Consumer Handbook on Adjustable Rate Mortgages (CHARM). The booklet includes information on the features and risks of ARM loans, including a comparison table for fixed-rate and ARM loans and examples of loan terms, projected payments, and more, NAFCU reported.
For regulated entities, the CFPB proposed amendments to Regulation Z addressing the sunset of LIBOR. It would make changes to:
- Certain open-end and closed-end provisions to provide examples of replacement indices for LIBOR indices that meet certain Regulation Z standards
- Certain open-end provisions restricting index changes, requiring change-in-terms notices, and addressing how credit card rate reevaluation requirements apply
Comments on the proposal are due to the Bureau Aug. 4.