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#1521201 - 03/14/11 02:45 PM
Single Premium Credit Insurance
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Member
Joined: Jun 2010
Posts: 96
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One of my co-workers mentioned he heard that the Dodd Frank Act would be eliminating Single Premium Credit Insurance (credit life, disability, etc.). He did not have any documentation on this however, and wanted me to verify this for him. I had scoured all the Dodd Frank materials I have and can not find any reference to this. Has anyone heard of this?
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#1521235 - 03/14/11 03:33 PM
Re: Single Premium Credit Insurance
villenbe
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10K Club
Joined: Oct 2006
Posts: 14,390
Cheeseheadland
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It's been awhile since I looked at this part of DF, but if memory serves, it's not that it is eliminated, but I thought that it could no longer be financed.
Don't quote me though... I would need to confirm.
Confirmed:
Creditors will no longer be able to finance (directly or indirectly) single premium credit insurance for any residential mortgage or open-end credit plan secured by the the consumer's principle dwelling.
Last edited by Just Jay; 03/14/11 03:41 PM.
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#1521275 - 03/14/11 04:17 PM
Re: Single Premium Credit Insurance
#Just Jay
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Joined: Jun 2010
Posts: 96
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#1521283 - 03/14/11 04:23 PM
Re: Single Premium Credit Insurance
villenbe
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10K Club
Joined: Oct 2006
Posts: 14,390
Cheeseheadland
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That said, they rule hasn't been written yet, so no need to change anything in the short term.
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#1559665 - 06/02/11 04:11 PM
Re: Single Premium Credit Insurance
#Just Jay
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100 Club
Joined: Sep 2008
Posts: 124
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Do we know a compliance date for this yet? I thought I understood it to be effective 18 months after the transfer date which is July 21, 2011, however we received a notice from the credit life insurance company stating that it will be prohibited effective July 21, 2011. Does anyone have any information on this?
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#1559761 - 06/02/11 05:40 PM
Re: Single Premium Credit Insurance
hsimmers
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10K Club
Joined: Jul 2001
Posts: 84,360
Galveston, TX
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SINGLE PREMIUM CREDIT INSURANCE PROHIBITED.—No creditor may finance, directly or indirectly, in connection with any residential mortgage loan or with any extension of credit under an open end consumer credit plan secured by the principal dwelling of the consumer, any credit life, credit disability, credit unemployment, or credit property insurance, or any other accident, loss-of-income, life, or health insurance, or any payments directly or indirectly for any debt cancellation or suspension agreement or contract, except that—
(1) insurance premiums or debt cancellation or suspension fees calculated and paid in full on a monthly basis shall not be considered financed by the creditor; and
(2) this subsection shall not apply to credit unemployment insurance for which the unemployment insurance premiums are reasonable, the creditor receives no direct or indirect compensation in connection with the unemployment insurance premiums, and the unemployment insurance premiums are paid pursuant to another insurance contract and not paid to an affiliate of the creditor.
REGULATIONS; EFFECTIVE DATE.—
(1) REGULATIONS.—The regulations required to be prescribed under this title or the amendments made by this title shall—
(A) be prescribed in final form before the end of the 18-month period beginning on the designated transfer date; and
(B) take effect not later than 12 months after the date of issuance of the regulations in final form.
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#1574735 - 07/07/11 12:27 PM
Re: Single Premium Credit Insurance
rlcarey
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Platinum Poster
Joined: Feb 2003
Posts: 962
PA
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So as of today, there is still no cut-off date for being able to finance single premium insurance? As far as I can find, the rules do not appear to be written yet. Correct?
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#1622571 - 11/01/11 02:15 PM
Re: Single Premium Credit Insurance
AuditorK
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Platinum Poster
Joined: Oct 2009
Posts: 604
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Has this been finalized? Received a doc today that made it sound like it was already a done deal. I don't remember seeing anything yet.
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#1622788 - 11/01/11 04:49 PM
Re: Single Premium Credit Insurance
JobSecurity
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10K Club
Joined: Oct 2000
Posts: 40,086
Cape Cod
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Consider the source of the document. Who's it from?
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John S. Burnett BankersOnline.com Fighting for Compliance since 1976 Bankers' Threads User #8
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#1713424 - 06/22/12 06:44 PM
Re: Single Premium Credit Insurance
John Burnett
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Diamond Poster
Joined: May 2001
Posts: 1,873
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Has this been finalized yet?
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#1713452 - 06/22/12 07:26 PM
Re: Single Premium Credit Insurance
villenbe
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10K Club
Joined: Oct 2000
Posts: 40,086
Cape Cod
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No. It's one of a host of things on the Bureau's plate with a deadline for a final rule of January 21, 2013.
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John S. Burnett BankersOnline.com Fighting for Compliance since 1976 Bankers' Threads User #8
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#1713456 - 06/22/12 07:30 PM
Re: Single Premium Credit Insurance
villenbe
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Diamond Poster
Joined: May 2001
Posts: 1,873
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Ok.....great...Thanks.....I can push that back a little.....
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#1713462 - 06/22/12 07:36 PM
Re: Single Premium Credit Insurance
villenbe
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10K Club
Joined: Oct 2000
Posts: 40,086
Cape Cod
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Well, it's part of MRAPLA, and the Bureau has said it intends to get proposed rules out by this summer (presumably so it can just barely squeak the final rule in by 1/21/13). Most of MRAPLA becomes effective without a final rule in place if the final rules aren't completed by 1/21/13.
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John S. Burnett BankersOnline.com Fighting for Compliance since 1976 Bankers' Threads User #8
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#1713504 - 06/22/12 08:24 PM
Re: Single Premium Credit Insurance
John Burnett
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Diamond Poster
Joined: May 2001
Posts: 1,873
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Thank you John
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#1719137 - 07/11/12 07:36 PM
Re: Single Premium Credit Insurance
John Burnett
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Gold Star
Joined: Dec 2006
Posts: 435
TN
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OK - I'm in acronym overload. What does MRAPLA stand for?
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#1719144 - 07/11/12 07:46 PM
Re: Single Premium Credit Insurance
villenbe
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Power Poster
Joined: Oct 2009
Posts: 3,927
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Mortgage Reform and Anti-Predatory Lending Act (title XIV of DFA).
Last edited by Doug Hendrickson; 07/11/12 07:47 PM.
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#1719306 - 07/12/12 01:46 PM
Re: Single Premium Credit Insurance
Doug Hendrickson
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Gold Star
Joined: Dec 2006
Posts: 435
TN
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I eventually found it - isn't Google wonderful?
Thanks.
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#1721471 - 07/19/12 01:57 PM
Re: Single Premium Credit Insurance
Sewanee, CRCM
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Power Poster
Joined: Aug 2001
Posts: 7,364
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And soooooo, there is still no proposal out there yet from the CFPB?
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#1721525 - 07/19/12 03:32 PM
Re: Single Premium Credit Insurance
villenbe
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Diamond Poster
Joined: May 2001
Posts: 1,873
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Swiggles....the proposal "may" be out there, but it isn't final....At this point....I'm looking at only final effective date...... I think............
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Riding the waves of change.....2014
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#1721545 - 07/19/12 03:57 PM
Re: Single Premium Credit Insurance
villenbe
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Power Poster
Joined: Aug 2001
Posts: 7,364
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Management had asked if a proposed rule had been published and so I just wanted to make sure before I told them "no." I'm typically notified by email of proposed rules, but I couldn't find anything on this one.....just wanted to make sure I haven't missed something.
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The more you sweat in training, the less you bleed in battle.......
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#1722030 - 07/20/12 07:38 PM
Re: Single Premium Credit Insurance
villenbe
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10K Club
Joined: Oct 2000
Posts: 40,086
Cape Cod
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We would have included a notice of any such proposal in our Top Stories and morning Compliance Briefing. I can assure you that the proposal hasn't seen the light of day yet. If you need a bit more comfort, you can always scrutinize the Bureau's Notice and Comment webpage at http://www.consumerfinance.gov/notice-and-comment/
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John S. Burnett BankersOnline.com Fighting for Compliance since 1976 Bankers' Threads User #8
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#1756346 - 11/08/12 02:20 PM
Re: Single Premium Credit Insurance
villenbe
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Gold Star
Joined: Jul 2007
Posts: 320
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I have not seen anything about this in any of the proposals. Does that mean it's effective 1/21/13 as written in DFA? Or do we think that the CFPB will be releasing something on this shortly?
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#1756442 - 11/08/12 05:29 PM
Re: Single Premium Credit Insurance
pacar
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Power Poster
Joined: Mar 2004
Posts: 2,512
Up North
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I believe this is part of the Lender Compensation Revisions to Reg Z that they are hoping to finalize by 1/21/13.
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#1756458 - 11/08/12 05:58 PM
Re: Single Premium Credit Insurance
villenbe
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Gold Star
Joined: Jul 2007
Posts: 320
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A-Ha! There it is. Thank you!
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