The Dodd-Frank Act directed the Consumer Financial Protection Bureau (CFPB) to integrate certain mortgage loan disclosures which are currently required under The Truth in Lending Act (TILA) and Real Estate Settlement Procedures Act (RESPA). The changes make the disclosures more clear, concise, and consistent among all lenders. The changes also ensure customers promptly receive the information they need to make the best financial decision based on a clear summary of loan features, prices, and fees.
Impacts to the industry
The TILA-RESPA Integrated Disclosure Rule mandates significant changes to the disclosure forms that all lenders provide to customers applying for a closed-end mortgage loan along with changes that will require certain fees to be more specifically disclosed. The rule also states lenders are responsible for retaining evidence of compliance with the new requirements. Failure to meet the requirements may result in consumer litigation, in addition to monetary fines and other disciplinary actions.
To help ensure the new disclosures meet the objectives of protecting customers and helping them better understand the mortgage process, the CFPB completed extensive consumer and industry research.
All lenders must comply with the TILA-RESPA Integrated Disclosure Rule with applications for closed-end mortgages taken on or after October 3, 2015.
|Before October 3, 2015||On or after October 3, 2015|
|Within 3 business days of application, customers receive the Initial Truth-in-Lending (TIL) and Good Faith Estimate (GFE) || |
|At closing, customers receive the Final TIL and HUD-1 || |