WASHINGTON (12/15/11)--The Consumer Financial Protection Bureau (CFPB) this week continued its work on mortgage closing forms, releasing two different transaction/closing-cost disclosures for public comment.
One form is similar to the existing Real Estate Settlement Procedures Act (RESPA) HUD-1 Settlement statement that homebuyers receive when they close a mortgage loan, the CFPB said. The second form is based on a CFPB prototype for mortgage disclosures that are provided when homebuyers first apply for a mortgage loan. Both of the forms present the same information; it is only the format that is different.
The CFPB is asking for any improvements that could be made to either form, and has asked the public to comment on whether the forms present the needed information in a consumer-friendly format, whether consumers that use the sample forms are able to easily identify key loan terms and closing costs, and whether all needed information is provided in the sample form.
The CFPB is working on a mortgage disclosure form project to combine the federal Truth in Lending disclosures and RESPA HUD-1 Settlement statement into a single document. The CFPB has said the goal of the revisions is "to provide information in a clear and simple way that consumers will find easier to use and understand and that industry will find less burdensome."
A final version of the mortgage disclosures will be released to the public between now and February, the CFPB said.
The combined closing form is meant to accompany the CFPB's combined Truth in Lending Act/Real Estate Settlement Procedures Act (RESPA) document. The CFPB is also planning to develop new mortgage regulations once the mortgage disclosure form revision project is completed.
The CFPB said the mortgage reform efforts seek to reduce the paperwork burden faced during the mortgage process by 50%.
CUNA continues to be actively involved in roundtable discussions and other forums with CFPB personnel and others as the mortgage revision process moves forward. For the CFPB release, use the resource link.