Summary: Proposed Rule on Prohibited Terms/Conditions in Agreements for Consumer Financial Products/Services

NASCUS Summary re: Proposed Rule on Prohibited Terms/Conditions in Agreements for Consumer Financial Products/Services

12 CFR Part 1027

The Bureau is withdrawing its proposed rule on Prohibited Terms and Conditions in Agreements for Consumer Financial Products/Services.  The Bureau will not take any further action on the NPRM at that time and the withdrawal is effective as of May 15, 2025. The withdrawal notice can be found here.

Summary

The proposal would have prohibited certain contractual provisions in agreements for consumer financial products or services. The Bureau is withdrawing the proposal in light of changes in and updates to its policies, agenda and objectives.  The Bureau is re-evaluating the need for this proposal’s prohibition on the use of certain contractual provisions that limit expression or purport to waive substantive consumer legal rights and protections or their remedies under State or Federal law.

The Bureau notes that the original NPRM is largely duplicative of the Federal Trade Commission’s Credit Practices Rule.  Given this duplication and the Bureau’s policy of erring on the side of limiting regulatory burdens, the Bureau believes it is necessary to withdraw the proposal. (May 15, 2025)