TILA-RESPA implementation effective October 3, 2015

Thanks to a procedural oversight (the CFPB failed to submit certain timely reports to the House of Congress and the Comptroller General of the GAO), implementation of the TILA-RESPA Final Rule and Amendments was delayed from August 1 to October 3, 2015. The delay was granted to facilitate smooth implementation and provide financial institutions with more time to prepare.

According to the CFPB, the “Know Before You Owe” Final Rule and Amendments significantly strengthen and streamline the mortgage loan disclosures provided to consumers, noting “the stress of shopping for a mortgage will be reduced” for consumers who apply for most mortgages after October 3. By collapsing four overlapping disclosure forms into two forms, the new rule is designed to help ensure consumers understand the costs, risks and benefits of their loans before they make a final commitment to the loan, minimize changes at closing and make it easier for consumers to understand how and why closing costs may have changed.

The final rule also makes two technical changes to the TILA-RESPA Final Rule that were not in the proposed rule, impacting § 1026.38:

  • Adds to the amount disclosed as “Final” for Adjustments and Other Credits the amount disclosed for certain personal property sales, effectively streamlining the calculation of Adjustments and Other Credits on the Closing Disclosure and Loan Estimate.
  • Conforms the disclosure of the borrower’s cash to close in the Calculating Cash to Close and the Summaries of Transactions tables on the Closing Disclosure to include, in the amount disclosed as Closing Costs Paid at Closing, lender credits.

Click here to view the entire TILA-RESPA Final Rule.

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