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Wyatt Bell's Blog

CFPB - The Last Dance .... or Is It?
by Wyatt Bell | 2012/02/22 |

The   Consumer Financial Protection Bureau has issued the final round of the  proposed  Settlement Disclosure Form which will replace the GFE HUD  1/1A. This round is being tested in Austin, TX.

Wyatt Bell's Blog ::

Here're the latest proposed Settlement Disclosures from CFPB (Consumer Financial Protection Bureau):

The Tupelo Example appears to replace the current GFE (Good Faith Estimate)

Tupelo Example

The Basswood Example appears to replace the current GFE/HUD 1. No HUD 1A as of this release.

Basswood Example

 

More information is available at the CFPB web site.




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112 words | 1443 views | 2 comments | log in or register to post a comment


The last dance?

Wyatt

Again I thank you for keeping us informed.  I have reviewed the Basswood example.  I like page 1 and 5 because they are very straightforward, but there is simply no reason why this same information can't be put on 1 page, thus eliminating at least 1 page of the form. 

Page 2 is a good line by line breakdown of fees charged and actual "costs" to be paid.  But again, I think that pages 2 and 3 should be combined. 

Let's see how this balloon floats. 

 
by CHARLENE PERRY | 2012/02/22 | log in or register to post a reply

Dancing On! They Shoot Horses Don't They!
Charlene,

I agree with you that the form is long with regard to information disclosure. It could be consolidated. I also think it is attempting, though we have yet to know the rule,  a "trial balance" kind of technique where a peculiar number would stand out. Much like adding a list of entries which if not zero indicate a problem.

I'm looking at some of the entries such as Closing Costs Financed within Calculating Cash to Close on Page 3. The Estimate and which charges to include in the Closing Costs Financed could get a little tricky. I'm thinking ahead as to what the rule may require.

These new calcs are demonstrated a little better with the Other Adjustments and Credits under Page 3, Calculating Cash to Close. The -$377.06 is derived from subtracting the City/Town Taxes of $844.56 from the HOA Fee of $467.50. It would appear that lines 09 and up would be summed from Section K and lines 10 and up from Section L in aggregate subtracted from this. You being an experienced settlement agent know the issues of debit/credit distortions.

This is the very thing that can make disbursements a real headache!

I'm curious if a Settlement Disclosure 1A is in the offing for refinance transactions.

Also, where some have adopted the GFE/HUD for Cash, Assumptions and Seller Financed I'm not sure this Settlement Disclosure will be conducive to those types.

The GFE/HUD rule was one of the most oddly written contradictory pieces of agency enactment I've ever read. I'm hoping CFPB will listen with a keen ear to the industry and realize some of their attempts add complexity which leads to lesser understanding.
 
by Wyatt Bell | 2012/02/22 | log in or register to post a reply
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