Amendments have been finalized for integrated disclosures required under the Truth in Lending Act and the Real Estate Settlement Procedures Act. In addition, comments are sought for a new proposal.
New
TILA-RESPA
integrated disclosures as required by the Consumer Financial Protection Bureau’s Know Before You Owe rule became effective in October 2015.
TRID was designed to streamline the disclosures that are provided to consumers when they apply for, and close on, a mortgage.
Since the rule went into effect, the CFPB has provided guidance about it.
On Friday, the bureau said that it has finalized updates to the Know Before You Owe rule that both formalize the guidance and provide greater clarity, technical directions and certainty.
According to the CFPB, tolerance provisions for the total of payments disclosure have now been aligned with
tolerances for the finance charge and disclosures affected by the finance charge.
The regulator said that recording fees and transfer taxes can be charged in transactions where the loans are originated primarily by housing finance agencies without such entities losing eligibility for a partial exemption.
Loans to finance cooperatives that are not secured by real property will now be subject to the rule. This change is intended to simplify compliance while ensuring more borrowers benefit from the rule.
The notice indicated that the bureau
understands that it is usual, accepted and appropriate for creditors and settlement agents to provide the Closing Disclosure to sellers and real estate brokers or other agents. Additional commentary is being finalized that will clarify how a creditor may provide separate disclosure forms to the consumer and the seller.
“Our updates will clarify parts of our mortgage disclosure rule to make for a smoother implementation process for lenders and consumers,” CFPB Director Richard Cordray said in the announcement.
In addition, comments are being sought for a proposal
addressing when a creditor can use a Closing Disclosure instead of a Loan Estimate to determine if an estimated closing cost was disclosed in good faith and within tolerance. Once the proposal is published in the Federal Register, comments will be accepted for 60 days.
