CFPB Proposes Two-Month Extension of Know Before You Owe Mortgage Rule
On June 24, 2015, the Consumer Financial Protection Bureau (CFPB) issued a proposed amendment to the Know Before You Owe mortgage disclosure rule, which proposes to move the rule’s effective date to October 3, 2015.
“The CFPB is proposing a new effective date of Saturday, October 3. The Bureau believes that moving the effective date may benefit both industry and consumers with a smoother transition to the new rules,”
the Bureau said in the statement.
[video] CFPB Rule Provides Tighter Fee Tolerances
As discussed in previous videos, the lender has to disclose to the borrower services and service providers they can shop for on a provider list. The Lender is responsible for ensuring the figures stated in the Loan Estimate are made in good faith and consistent with the best information reasonably available at the time the […]
Making a Smooth Transition to the New Closing Disclosure Form
As the real estate community makes the transition to the new rules and new forms set forth by the CFPB beginning August 1, there will be a period where existing escrow transactions will use the HUD-1 Settlement Statement and new transactions will begin using the new Closing Disclosure Form.
The Loan Application Date is the Determining Factor
The key factor in determining which form will be used is the date of the loan application.
In other words, transactions with loan applications made before August 1st will use the HUD-1 Settlement Statement and transactions with a loan application date after August 1st will use the new Closing Disclosure.