CFPB Issues Interpretive Rule on Impact of Juneteenth Holiday for 2021
The Consumer Financial Protection Bureau (CFPB) has issued an interpretive rule to provide guidance on whether Juneteenth should be treated as a federal holiday or business day for 2021 for purposes of calculating TILA rescission and disclosure timing periods.
The legislation making Juneteenth a federal holiday was signed by President Biden on June 17, 2021, only two days prior to the June 19th holiday. The timing of the law’s enactment caused confusion in the mortgage industry concerning whether June 19th should be treated as a federal holiday or a business day for TILA purposes.
“We understand that the quick enactment of the federal Juneteenth legislation created interpretive questions and compliance challenges for the mortgage industry with respect to rescission of closed-end mortgages and certain time-sensitive mortgage disclosures. The mortgage industry can refer to today’s interpretive rule when determining how to treat June 19, 2021,” said CFPB acting director Dave Uejio.
The CFPB indicated in its interpretive rule that the determination as to whether June 19th counted as a federal holiday in 2021 depends on when the relevant time period began. If TILA disclosures were given:
• On or before June 17, 2021, then June 19th was a business day
• After June 17, 2021, then June 19th was a federal holiday
Friday, June 18th was the federal ‘observance’ for the 2021 Juneteenth holiday, meaning that federal employees did not work that day. The CFPB confirmed that, for TILA purposes, the 18th was still treated as a business day for purposes of rescission and disclosure timing requirements.
The rule also notes that there is nothing prohibiting lenders from providing longer time periods than required. This statement may serve to validate the industry response to the Juneteenth holiday of adding an additional business day to rescission notices for loans closed on or before June 17, 2021.
To read the entire Interpretive Rule, please visit CFPB Interpretive Rule on Impact of the 2021 Juneteenth Holiday.