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Basics for the Integrated Mortgage Disclosure Rule Changes Effective 8/1/15 – CFPB Update #3

The Title Counseler

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THE EFFECT OF THE NEW LENDING DISCLOSURE TIMELINE ON SCHEDULING CLOSINGS

CB Title is committed to providing you with training and reference materials related to the new regulations and forms coming August 1st.  Please see below for our third in a series of informational bulletins about the new CFPB forms. 

As part of the new rule creating the new loan estimate and new closing disclosure forms, the CFPB determined that borrowers would be better served by having a short time to review the new Closing Disclosure prior to signing their loan documents. As a result, the Rule requires borrowers have three days after receipt of the Closing Disclosure form to review the form and its contents prior to signing loan documents.

This will affect the schedule of closings because the three-day review period starts upon “receipt” of the form by the borrower. Unless some positive confirmation of the receipt of the form occurs (i.e., hand delivery), the form is “deemed received” three days after the delivery process is started (i.e., mailing). As a result, the combination of the “delivery time period” and the “review time period” results in six business days from mailing to loan signing.

After delivery of the initial Closing Disclosure form, such changes as listed below may require a re-disclosure and new waiting period:

* Increase of APR by greater than 1/8%

* Change in loan program such as Fixed rate to ARM

* Addition of pre-payment penalty after the initial disclosure

Please click on the link below to see the new lending disclosure timeline:

 New Lending Disclosure Timeline

See our next bulletin in this series for more information. Feel free to contact us with any questions.

This bulletin is sent courtesy of CB Title Group, LLC, Fidelity American,  and Fidelity National. This article is for informational purposes only and is not intended to provide legal advice, but rather to provide insight into legal developments and issues that may be useful to our clients and friends.  In no circumstance is this article intended to be a full treatment of the above subject matter.  Reader is advised to obtain additional information as noted. 

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