CFPB Releases Final Rule on Combined Mortgage Disclosures

Rule Effective on August 1, 2015

The Consumer Financial Protection Bureau (CFPB) today released its final rule on the new combined disclosure/settlement statement that will replace the GFE, TIL and HUD-1. The rule will go into effect Aug. 1, 2015, so as we had hoped and requested, there is a lengthy implementation period. You can review the 1,888-page rule in its entirety here and today’s press release from the CFPB here.

Although we’ve not been able to study the rule yet, initial reports indicate that most of the changes TLTA and the industry worked hard to secure were indeed made, so we are pleased that our advocacy efforts were successful in that regard. Those changes include:

  • Title fees will not be included in the APR
  • Shared responsibility between lender and settlement agent for filling out the form is allowed
  • Expanded exceptions within the “3-day-rule”
  • No machine-readable forms storage and usage requirements

This new rule, however, represents a monumental change in the way transactions have been conducted, and there is much work to be done during this implementation period to get title agents and lenders ready. The final rule provides two new disclosures: a Loan Estimate, which would be provided three business days after the consumer submits a loan application and would replace the initial TIL and GFE, and a Settlement Disclosure, which would be provided at or before closing and would replace the final TIL and HUD-1.