Effective August 1, 2015 the Consumer Financial Protection Bureau (CFPB) will require new Mortgage Loans to include two new mortgage loan documents.
- The new Loan Estimate form replaces the current Good Faith Estimate of Settlement Costs (GFE) and initial Truth in Lending Disclosure (TIL).
- The new Closing Disclosure form replaces the current HUD-1 Settlement Statement and final Truth in Lending Statement.
When the forms are rolled out on August 1, 2015, lenders also will be required to provide borrowers with their Loan Estimate three business days after the loan application date, and the Closing Disclosure three business days before the closing. These rules are designed to give borrowers more time to review and understand their loan terms.
These new mortgage loan documents are intended to be clearer and more easily understood by borrowers. However, while they may be more easily understood, they are also very different from the loan documents they are replacing. For this reason, lenders, servicers, and title companies are all working hard to be ready for the August 2015 deadline.
Paradatec has also been hard at work creating and testing rules to enable our systems to continue to provide the highest mortgage loan document automation in the industry not only for these new documents but for hundreds of others. Be assured, that we will be ready to assist in providing a seamless transition to these new mortgage documents far before their August implementation deadline.