As the Consumer Financial Protection Bureau streamlines mortgage disclosure forms, banks worry that the proposed simplification may become a burden.
The concern from across the industry poured in with more than 2,000 letters responding to the CFPB's required plan. Bankers argued several requirements would add constraint and confusion, "including the rigorous timeline for presenting borrowers with the new forms, limited deviation of estimated charges between initial and final disclosures, and an 'all-in' annual percentage rate'," writes American Banker's Joe Adler.
Bankers fear that the proposal will detract from the quality of disclosures and become an unnecessary encumbrance. "We are concerned that some aspects of the proposal will add to 'information overload,'" adds Sy Naqvi, chief executive of PNC Mortgage, in a letter to the CFPB.
The CFPB, created under the Dodd-Frank Act, assumed rulemaking for disclosures and launched the project of combining the Truth in Lending Act and Real Estate Settlement Procedures Act forms.
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