As the Consumer Financial Protection Bureau (CFPB) continues to consider ways to reform mortgage disclosures the Truth in Lending and Good Faith Estimate forms, they are preparing to launch the second phase of public comment regarding proposed changes.


The individual forms are considered to be too long and complicated, and contain overlapping information.  The goal in combining them is to devise a single disclosure that clearly explains the terms and costs of a loan to a prospective borrower.

To help with the redesign process, the CFPB launched a public comment process to encourage both consumers and mortgage industry participants to provide feedback and idea on how to accomplish the goals.  In launching Know Before You Owe, they began the first of what they say will be multiple rounds of comments on proposed forms.

In the first round of comments, the CFPB received over 13,000 comments about two draft versions of the new form.  Seven thousand of those responses were through the consumer response channel and five thousand came from the industry response portal.

The agency has now compiled those comments, is finalizing revisions, and is preparing to launch the second round of public feedback.

In the next round, the CFPB plans to focus in on one specific aspect of the new form, how closing costs are communicated.  The concern is that closing costs can be confusing and complicated, to the agency is seeking a clear and simple way to present the cost information so that borrowers fully understand what they are paying for.

The CFPB expects to post the latest version and open the next round of comments next week.