Posted by Robert522TX on 11/20/13 7:35pm
Msg #493481

NEW DISCLOSURE FORMS RELEASED BY CFPB

BREAKING NEWS:
Today the CFPB released the final versions of the new disclosure forms called "Know Before You Owe" Loan Forms. See the details below...

http://www.consumerfinance.gov/knowbeforeyouowe/#rule

Reply by MW/VA on 11/20/13 9:21pm
Msg #493490

Looks good--simple & straightforward. Does this replace

the GFE?

Reply by Saul Leibowitz on 11/20/13 10:20pm
Msg #493496

Re: Looks good--simple & straightforward. Does this replace

It is supposed to.

Reply by Bear900/CA on 11/21/13 12:16am
Msg #493505

Won't be used til mid 2015 n/m

Reply by BobbiCT on 11/21/13 9:57am
Msg #493525

LOL providing ...

Providing they don't change the forms again before then.

AKA Computer programmers full employment act.

Government efficiency, paperwork reduction act and plain language act at work: Take a simple to prepare and read 3-page form and annually rearrange the information, increase it by multiple pages, cross reference and re-name the same figures on different pages under different headings, so that even those explaining it have a hard time finding what they are looking for and figuring it out. If the person who has to prepare the form has a hard time entering the data, imagine how easy it will be for the consumer to understand it. Of course, the government probably estimates it will only take 15 minutes for a clerk to prepare the form.

For those of us who remember when the W-4 was one page - until under the paperwork reduction act and plain language act it was simplified to four pages.

Reply by Bear900/CA on 11/21/13 1:00pm
Msg #493569

So true BobbieCT - call it the CFPB Employment Act

They have been working on this for two years using a variety of different forms and form combos.

The process had been open for public comment during that time though I think it was mostly LO's and their organizations that provided feedback.

The CFPB was also to test market the new forms in certain areas to get public reaction.

There are three big pushes right now:

1. How the new ATR (Ability to Repay) and QM (Qualified Mortgage) going into effect on Jan 10 is going to rock everybody's world. Basically, the CFPB wants that to settle in before utilizing the new forms.

2. Loan origination software updates to include all the ramifications of ATR. This is more than programing. There are calculations to fit the 3% Cap Rule, as well as integration of everything from automated underwriting from FNMA, Freddie, FHA and how to calculate Higher Priced (HPML) loans. These are some huge changes.

3. In the meantime, the CFPB would like to see more e-signing put in place. The idea is to simplify the entire process along with the new forms for the customer.

Affect on Notaries? We'll see. Don't jump too fast on the SPW bandwagon.

Here's the two combined forms, each includes a version of the TIL.

The Loan Estimate: This form will be provided to consumers within three business days after they submit a loan application. It replaces the early Truth in Lending statement and the Good Faith Estimate, and provides a summary of the key loan terms and estimated loan and closing costs. Consumers can use this new form to compare the costs and features of different loans.

The Closing Disclosure: Consumers will receive this form three business days before closing on a loan. It replaces the final Truth in Lending statement and the HUD-1 settlement statement, and provides a detailed accounting of the transaction.

http://nationalmortgageprofessional.com/news44930/know-you-owe-officially-unveiled-cfpb?utm_source=MadMimi&utm_medium=email&utm_content=NMP+Daily%3A+CFPB+Targets+August+2015+for+Industrywide+Mortgage+App+Simplification+and+More+___&utm_campaign=20131120_m118018350_NMP+Daily%3A+CFPB+Targets+August+2015+for+Industrywide+Mortgage+App+Simplification+and+More+___&utm_term=CFPB+Targets+August+2015+for+Industrywide+Mortgage+App+Simplification

Reply by Bear900/CA on 11/21/13 1:29pm
Msg #493572

Qualitative and Quantitative Tests of the new forms

For those interested in the details:

http://files.consumerfinance.gov/f/201311_cfpb_factsheet_kbyo_testing.pdf

Reply by Bear900/CA on 11/21/13 2:04pm
Msg #493576

How this will clost the customer more, as always.

This is a major change of responsibilty from the title company to the lender. Lenders will charge more to recoup their costs. Unintended consequences....

"Bob Davis, an executive vice president at the American Bankers Association, says a critical change was the shifting of responsibility for the final closing disclosure to the creditor or lender."

"He says the three-day disclosure requirement creates a form of "rate lock," whereas currently the interest rate can float up until the day a loan funds.

"If you have certainty about the date, time is money and somebody has to pay for that somehow," Davis says. "If that certainty is being provided to the consumer, what does it cost the creditors and how are they going to be compensated?"

http://www.nationalmortgagenews.com/dailybriefing/New-Mortgage-Disclosure-Rule-Could-Raise-Costs-to-Consumers-1039998-1.html?ET=nationalmortgage:e5004:464570a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=ON_Bulletin_112113&site=default_on

Reply by Linda_in_IN on 11/21/13 6:52am
Msg #493509

Next step is transforming the closing process

According to statements made during the hearing, the next planned stage or what CFPB is looking at with Know Before You Owe is transforming the closing process. Several times during the presentation there was reference to electronic documents and "revolutionary" methods used in the closing, all to make the process easier for the consumer.