Newsroom

Jan. 26, 2012 – Another round of testing in the Consumer Financial Protection Bureau's "Know Before You Owe" mortgage disclosure initiative opened this week to garner input on which of two prototype settlement disclosure forms work best with the latest iteration of the draft application disclosure.

Testing has begun in Philadelphia, but the new prototypes are also available on the CFPB's website, where comments are also being collected.

The settlement disclosure prototypes – one for the "Butternut Bank" and an alternative for the "Hemlock Bank" – are both five pages long. Reviewers are asked to see which of the two works best with the three-page "Sassafras Bank" application disclosure.

Input is sought on the following:

Can you easily find key loan terms?

Are you able to identify changes to the loan terms or costs?

Do you know whom to contact to discuss your loan or changes to your loan?

Do you have the information you would need to feel comfortable closing on the loan?

Are the disclosures easy for lenders and settlement agents to use and explain to consumers?

The final round of testing is set for February, the CFPB says. The bureau explains this and more in a Jan. 24 blog post. It will also notify those anyone signing up for its Know Before You Owe email on the next testing round.

NAFCU is reviewing the latest round of prototype closing disclosures and will submit comments.