The Consumer Financial Protection Bureau proposed two new rules regarding mortgages. One is intended to simply mortgage forms and disclosures. The second would lower broaden the definition of a "high-cost loan" and tighten the rules for them.
The new three-page loan estimate form combines "overlapping disclosure policies currently required under the Truth in Lending Act and Real Estate Settlement Procedures Act," writes American Banker's Kevin Wack. Lenders would them be required to provide a five-page closing disclosure form — that they could easily compare to the estimate — three days before close.
There will be "no more costs and risks buried in the fine print that do not become clear until it is too late," said CFPB director Richard Cordray.
David Stevens, president of the Mortgage Bankers Association, praises the intention, but would like to see a comment period longer than 60 days. "It's almost like coming into a factory and saying, 'We're going to change the entire process by which a certain product is manufactured," he said.
Stay tuned, "the agency plans to propose rules on mortgage points and fees this summer," Wack tells us.
For the full piece see "CFPB Proposes New Mortgage Forms and Limits on Lending Costs,"
Check out examples of the forms at the CFPB's Know Before You Owe website