In 2011, Congress established the Consumer Financial Protection Bureau (CFPB) to focus on protecting and educating consumers for all types of loans. The CFPB will regulate mortgage lenders, banks and credit unions, student loans, credit card companies, and fast cash (payday loan) businesses. In general, this agency was established to protect consumers from credit discrimination.
Originally scheduled to begin August 1, but may be delayed until October 1, consumers getting mortgage loans for their home purchases will see the following changes:
- Rather than the HUD-1 Settlement Statement being issued at closing, buyers will receive the Closing Disclosure which will summarize the terms and charges of the loan; and
- Lenders will combine two commonly used forms (the Good Faith Estimate and Truth in Lending disclosure forms) into a single form known as the Loan Estimate. Any changes to the Closing Disclosure may result in a delayed closing, but it is already anticipated that rather than a 30-day close, future closings will typically require 45 days.
So, if you’re purchasing a home later this year, you may need to allow 45 days from date of contract to date of closing. If you have questions about this issue, or any other real estate-related questions, feel free to contact me at firstname.lastname@example.org