Wednesday, May 18, 2011

CFPB Opens Discussion for New Mortgage Disclosures

Just in... the mortgage industry is getting a new form in the near future. In case you don't follow daily mortgage news, change is not usually well received in our industry but I think this might actually make a few disgruntled mortgage brokers happy. The CFPB or The Consumer Financial Protection Bureau posted this easy-to-take-survey today regarding the new GFE (Good Faith Estimate) and TIL (Truth in Lending) disclosures dubbed KNOW BEFORE YOU OWE on their blog today. They want YOU to weigh in on the form you like and why. There are two surveys to choose from that are catered to consumers or insiders to the industry. They've even got it set to share on facebook, tweet and email away to you friends, past clients, prospects, and colleagues if you are in the biz... hint, hint. Honestly, I'm impressed! 


I personally "voted" for Option A for the following reasons and provided the following feedback:

1: The layout is simple and to the point but the summary information is key and should be showcased. I would prefer the two columns actually be set above the banner. Most important the "Monthly Taxes & Insurance" should breakout the taxes, hazard insurance, and mortgage insurance, lumping the two types of insurances together is confusing.

2: The layout is easier to read when it is side by side and is without all the extra images that are in Option B. However the years range 9-30 the reason for the drop in the taxes and insurance is not clear without a breakout of the mortgage insurance & the taxes and hazard insurance.

3: I found this form easy to read but the seller credits and the lender credits should be separated so buyers can be clear of who brings what to the transaction. Plus there is no signature and date line, nor does either form disclose whether your rate is locked in or floating as this is very important information.

Overall this is a major improvement over what the GFE is currently...A three page nightmare that not one client has understood. Thank you CFPB for a job well done.