Truth in Lending and Good Faith Estimate Forms to be Eliminated and Replaced by a Single Form

In July 2010, Congress passed and President Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act). The Dodd-Frank Act created the Consumer Financial Protection Bureau (CFPB). Most Federal consumer financial protection authority will be transferred to the CFPB, beginning on July 21, 2011.

One of its initial rulemaking activities will be to combine  the federal Truth in Lending Act mortgage disclosure (TIL) and the Real Estate Settlement Procedures Act Good Faith Estimate (GFE) forms into one document.

Current federal law requires that mortgage loan applicants receive two documents – the TIL and the GFE – within three days of application. The current forms are two pages and three pages long, respectively. They have overlapping information and complicated terms that are confusing and difficult to understand.

The CFPB has created two alternate prototype forms to combine and replace the TIL and GFE forms.  The CFPB intends to conduct consumer testing of these two forms over the summer, and then to publish for comment, possibly as early as this fall, proposed regulations adopting a single replacement form.

CFPB Alternate Prototype Forms

• Consumer Financial Protection Bureau Disclosure Form Sample A
• Consumer Financial Protection Bureau Disclosure Form Sample B

Contact us today for more information.