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Friday, April 20, 2012

ABA with Trade Groups Comment on Draft RESPA-TILA Proposals

The CFPB’s goal in combining the Truth in Lending Act (TILA) and Real Estate Settlement Procedures Act’s (RESPA) mortgage disclosures should be to achieve a balanced, efficient set of rules that will guide mortgage shoppers for the next generation, ABA and eight other trade groups said this week in a comment letter. The trade groups were commenting on the CFPB’s February outline of draft rule proposals accompanying the “Know Before You Owe” mortgage loan initiative.
We … urge that the CFPB closely consider and analyze the impact of these proposals and our concerns with the substantive and procedural alternatives being discussed. We support the CFPB’s approach of reviewing the consumer’s entire experience, from initially considering a loan, through application and after loan closing, as the approach will result in the best disclosures.
The trade groups said that some of their concerns include the need for careful synchronization with other rulemaking efforts, especially those involving the “qualified mortgage” and “qualified residential mortgage” designations; the negative and unfair results of lowering cost tolerances; the unintended consequences of expanding the “APR” definition; and the burdens associated with requiring final settlement disclosures days before closing.

ABA expects the CFPB to issue formal RESPA-TILA regulatory proposals in July.

Read the letter.

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