Thursday, August 23, 2012

The Loan Estimate and Closing Disclosure


The Loan Estimate and Closing Disclosure

CFPB Process and Background/Basis for Change
  • 10 Iterations Submitted to Industry for Review and Informal Commentary

Temporary Exemption for Dodd-Frank Disclosure Obligations
  • Negative amortization feature warning.
  • State anti-deficiency protection disclosures
  • Partial payment acceptance policy disclosure
  • Mandatory escrow account disclosure
  • Waiver of escrow at consummation disclosure
  • Monthly payment disclosure for variable rate transaction with     escrow account
  •  Repayment analysis disclosure of monthly payment
  • Settlement charges and wholesale rate disclosures
  • Mortgage originator fees disclosure
  •  Total interest as percentage of principal disclosure
  • Appraisal management fee optional disclosure


Disclosures are Reflected in Proposed Loan Estimate and/or Closing Disclosure
  • CFPB is not sure about wholesale rate disclosure (proposed as                   cost of funds disclosure) and total interest as percentage of principal disclosure


Applicability
  • Excluded from this requirement are HELOCs, Reverse mortgages,Modular/Mobile (Not permanently affixed); or Creditors who make five (5) or fewer mortgages in a year




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