81 FR 49869 - Truth in Lending (Regulation Z)

BUREAU OF CONSUMER FINANCIAL PROTECTION

Federal Register Volume 81, Issue 146 (July 29, 2016)

[Federal Register Volume 81, Number 146 (Friday, July 29, 2016)]
[Rules and Regulations]
[Page 49869]
From the Federal Register Online  [www.thefederalregister.org]
[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.
    1. 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.
    2. 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.
    3. 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