Another resource is being made available to help mortgage firms prepare for combined loan disclosures that go into effect next year.
A rule finalized in November 2013 by the Consumer Financial Protection Bureau combines disclosures required under the Truth in Lending Act and the Real Estate Settlement Procedures Act.
Lenders will be required to provide prospective borrowers with a new Loan Estimate disclosure within three business days of taking an application.
In addition, a new Closing Disclosure will be required three business days prior to finalizing a loan.
The new disclosures, which are part of the CFPB’s Know Before You Owe initiative, become effective in August 2015.
In order to help lenders comply with the new rule, the bureau has held webinars and introduced a TILA-RESPA Regulatory Implementation webpage.
“Mortgage lenders should already be working on the new rule and getting ready now,” CFPB Deputy Director Steve Antonakes told attendees at the American Mortgage Conference Monday, according to a copy of his prepared remarks. “Significant changes to business operations and technology platforms will require close collaboration with third-party service providers.”
Antonakes said that the bureau plans to publish a readiness guide during the next few months.
The guide is intended to provide the industry with broad checklist of things to do to prepare for the rule.
Among the necessary tasks covered in the publication are updating policies and procedures and providing training for staff.
“In sum, we are trying to make our rules more understandable and user-friendly — so that you are ready to implement the new disclosure system come August 2015,” he said.
Antonakes noted that the CFPB is working with other regulators to help ensure consistency in the examination of mortgage lenders under the new rules. This exercise is also intended to clarify issues as needed.
