Monday, May 20, 2013

Flexibility in Mortgage Disclosure Rule

A coalition of 12 trade groups sent joint letters last week to Reps. Steve Stivers (R-Ohio) and Ed Perlmutter (D-Colo.) thanking them for their help in urging the Consumer Financial Protection Bureau (CFPB) to adjust a provision in its proposed mortgage disclosure rules that could cause costly delays in closings.

The provision requires that borrowers receive their final closing disclosure three business days prior to closing, and that if a cost that the borrow must pay to close increases during that time, a new statement and waiting period must be initiated.

Because changes frequently occur in the three days prior to a closing, the three-day-restart provisions can reduce consumers’ ability to make changes to their purchase, put their mortgage rate lock at risk and even cause their purchase contract to expire, the trade groups explained.

Reps. Stivers and Perlmutter have asked fellow Representatives to cosign a letter to the CFPB urging more flexibility in the rule.

The letter is below (click on image to enlarge).

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