So now the government wants our help. But this is going to be a good thing for all those homebuyers out there.
According to this USA Today article, the Consumer Financial Protection Bureau is looking to get our feedback to help make their mortgage paperwork and disclosures a lot more user friendly. They want to know suggestions on how to make the expenses easy to understand as well as getting input on what borrowers are looking to see in the paperwork.
For example, right now borrowers are given two documents when applying for a loan: a Truth in Lending form (a disclosure) as well as a Good Faith Estimate which predicts what your closing costs will be. And the Good Faith Estimate was just regulated last year saying that the total cost could not be more than 10% off what the initial estimate was.
But they’re still confusing. According to the article, “They really don’t tell the consumer what they want to know,” says Mike Anderson of the National Association of Mortgage Brokers. For example, a key concern for borrowers is the total amount they’ll need to pay at closing. Yet that figure is absent from the current forms.” Oftentimes you don’t receive the exact amount you need to bring to closing until 24 hours prior, sometimes as close to 2 hours prior. This is hard when closing first thing in the morning when you have to get to a bank first.
I think this is a great idea. They’re asking for our input as borrowers as to what’s important to us, rather than just trust the guys in suits that work there. So I suggest that everyone goes on the Web site to view the forms and make suggestions. It will be July 2012 before all the forms are finalized and the bureau said they’d be taking suggestions through at least September of this year.
I can’t stress enough how great it is that our feedback can go toward implementing something that we’ll continue to use. If you’re confused about any part of the forms or want to see more, definitely go online to give your input. It’d be great if they did this with the HUD-1 settlement statement as well. I have many buyers who are confused by how the statement appears and only get a cursory look with their attorney at closing.
I’m available online for all of your real estate needs.
