Supplemental NPRM for Time-Barred Debts Coming "Very Early in 2020"

On December 10, 2019, the Consumer Financial Protection Bureau's (CFPB) Director Kathleen Kraninger spoke at the National Association of Attorney Generals Captial Forum. In her remarks, Kraninger referenced the CFPB's rulemaking in debt collection and offered a view of the near future: a Supplemental Notice of Proposed Rulemaking (SNPRM) for time-barred debt disclosures is coming "very early in 2020." 

Kraninger mentioned that the CFPB's testing of these disclosures is completed. The survey was first announced in February 2019. For guidance on time-barred debt disclosures, Kraninger states that the CFPB looked to relevant state laws and enforcement actions. The Director mentions:

These disclosures are inextricably linked to state law. Reconciling these disclosures could help consumers receive the benefits of federal and state disclosures, while at the same time reducing uncertainty and compliance burdens for debt collectors.  

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insideARM Perspective

There were enough hints that a supplemental NPRM for time-barred debt disclosures was coming, so this news is not too surprising. Other than the consumer survey, the most obvious hint was the big ol' placeholder in the statute of limitations/time-barred debt section of the proposed rules.

As with the NPRM, we can expect the SNPRM to have a comment period once it is published in the Federal Register, so those in the industry who have input on this matter should ready themselves to prepare and submit a response. Time-barred debts are sensitive, and industry members who regularly interact with consumers on this type of debt have unique insights that should be shared with the CFPB, e.g., how real consumers react to these disclosures in-market versus through a controlled survey.