Consumer protection agency plans mortgage process overhaul for this summer

New York /
Jul.July 05, 2012 02:00 PM

The Consumer Financial Protection Bureau is seeking to overhaul the borrowing process for homeowners. According to the New York Times, the agency, established last year, wants to make the mortgage application process more comprehensible to borrowers.

The goal: To give consumers a “good faith estimate” of a loan’s actual costs, and to limit the amount of closing paperwork to a single disclosure form, stating the interest rate, how that rate could change over the course of the loan and how much cash is needed at closing. The overhaul would also require mortgage servicers to simplify all its information regarding services and options for buyers under foreclosure. The Bureau hopes to implement the new rules this summer, though the agency could face political opposition — as it has been a target of more conservative legislators since its inception.

“We have an overarching goal here, which is to restore trust in the consumer financial marketplace,” Richard Cordray, director of the bureau, told the Times. “I don’t think we are just a regulatory body or just an enforcement body.”

However, the road to mortgage reform may prove difficult. Big Spring, Texas’s State National Bank has already filed a lawsuit, questioning the constitutionality of the bureau based on a technicality involving the appointment of Cordray during a Congressional recess. [NYT]


Related Articles

arrow_forward_ios
Cash-Out Home Refinancing Hits 14-Year High in Third Quarter
Cash-out mortgage refinancing hits 14-year high
Cash-out mortgage refinancing hits 14-year high
Gov. Kathy Hochul (Getty, iStock)
Hochul opens $539M homeowner assistance fund
Hochul opens $539M homeowner assistance fund
(iStock/Illustration by Kevin Rebong for The Real Deal)
Watchdog org: Put home-sale commissions in buyers’ hands
Watchdog org: Put home-sale commissions in buyers’ hands
(iStock)
Rents in New York and South Florida metros surged more than 30%, led nationwide rise
Rents in New York and South Florida metros surged more than 30%, led nationwide rise
Princeton proud: Eric Schmidt reportedly bidding to save club
Princeton proud: Eric Schmidt reportedly bidding to save club
Princeton proud: Eric Schmidt reportedly bidding to save club
Fannie, Freddie to buy mortgages up to nearly $1M
Fannie, Freddie to buy mortgages up to nearly $1M
Fannie, Freddie to buy mortgages up to nearly $1M
Capital pains: How lenders are getting creative to get paid
Capital pains: How lenders are getting creative to get paid
Capital pains: How lenders are getting creative to get paid
(iStock)
Refinancing has saved homeowners billions, but window is closing
Refinancing has saved homeowners billions, but window is closing
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...