CFPB Proposes (1) TILA/RESPA Combined Disclosures & (2) HOEPA Changes
Written by Steve Van Beek
The First Shoe. Â Well - the initial mortgage proposals from Dodd-Frank are out. Â The initial verdict: Â 1099 pages andÂ 293 pages. Â And, keep in mind that this is only the beginning. Â There are numerous other mortgage proposals required by Dodd-Frank that will be proposed soon (and finalized within a short period of time after that).
Today's post will not attempt to provide an overview of the two proposals (we'll do that in our webcast tomorrow). Â Instead, we'll link to various documents and information released by the CFPB yesterday. Â Â
- Director Cordray's Speech - No MÃÂ¡s: Restoring Trust in Home-buying
- CFPB's Press Release - CFPB Proposes "Know Before You Owe "Mortgage Forms
- CFPB's July 5th Blog Post - Preparing for New Mortgage Disclosures: A Look Back at Know Before You Owe
- CFPB's July 6th Blog Post - Know Before You Owe: How We Learned to Build a Better Mortgage Disclosure
- CFPB's July 9th Blog Post - Know Before You Owe: Introducing our Proposed Mortgage Disclosure Forms
- CFPB's 5-Page Mortgage Fact Sheet - Restoring Trust in the Mortgage Market
- TILA/RESPA Disclosure Proposed Rule (1099 Pages)
- HOEPA/High-Cost Mortgage Loans Proposed Rule (293 Pages)
- CFPB'sÂ Know Before You Owe webpage with resources and additional information. Â
Quite a day for the Consumer Financial Protection Bureau. Â It is probably a good thing the CFPB doesn't have a Board and doesn't hold public meetings prior to proposing regulations - who has the time anyway when there is so much regulating that needs to be done??
No MÃÂ¡s. Â Director's Cordray's speech didn't hold back when it came time to summarize the existing mortgage market:
"I am here today to say about the mortgage market: Ã¢ÂÂNo MÃÂ¡s.Ã¢ÂÂ No more costs and risks buried in the fine print that do not become clear until it is too late. No more mortgages designed to fail Ã¢ÂÂ mortgages that benefit originators but not borrowers. No more last-minute shocks at the closing table that leave consumers stuck with fees they did not know about or plan for. And no more costly surprises and runarounds by mortgage servicers that leave people with nowhere to turn when they need help the most."
The CFPB's Fact Sheet carries this theme as well as it highlights future changes to (1) Shopping for a Mortgage; (2) Closing on a Mortgage; and (3) Paying Off a Mortgage. Â
Regulatory Burden is in the Details. Â Not surprising, the CFPB's press release and blog posts do not mention the current and future burden that is placed on financial institutions trying to understand and comply with these future changes. Â Unfortunately, while just reading through the proposals themselves seem like a momentous task - the actual regulatory burden is in the details as credit unions and other mortgage lenders will need to alter almost every aspect of their mortgage lending practices. Â Oh, and retrain all their staff. Â Â