On Monday, July 9th, the Consumer Financial Protection Bureau (CFPB) released a proposed rule for the final mortgage disclosure forms as part of their “Know Before You Owe” initiative. The Loan Estimate form, which is intended to replace the Good Faith Estimate, is designed to provide consumers with “an easier way to compare loan estimates from various lenders” and “includes information such as the loan amount, interest rate and projected payments.” The Closing Disclosure form, intended to replace the HUD-1 form, provides a detailed breakdown of closing costs and will be required to be provided to consumers “at least three business days before closing.” Both forms were created to reduce the redundancy and confusion stemming from the current disclosure forms consisting of the Real Estate Settlement Procedures Act and the Truth in Lending Act.
Public response pertaining to the new disclosure forms and the CFPB’s proposed rule is requested. Feedback for specific portions of the rule is requested by September 7th while the majority of the feedback is due by November 6th. To read learn more about the proposed rule, and view the side-by-side comparison of the proposed forms, go to http://bit.ly/MiQ4Yh.