Regulation

CFPB releases guide on TILA-RESPA integrated disclosure requirement

cfpbThe CFPB released a TILA-RESPA guide last week as a companion to its compliance guide for small entities, providing instructions on the completion of loan estimate and closing disclosure forms.

The CFPB guide, which is presented in question-and-answer format, provides sample examples of the forms and highlights common issues that may arise in completing the forms.

Late last month, the CFPB released its small entity compliance guide for the integrated TILA-RESPA disclosure rule, stressing that creditors are not permitted to use the new disclosures ahead of the rule’s August 1, 2015 effective date.

Under the combined disclosure rule, overlapping federal disclosure forms are replaced with two new forms: the loan estimate, which is given three business days after application, and the closing disclosure, which is given three days before closing.

The new forms must disclose monthly payment and interest rate information, as well as total closing costs, which are generally disclosed at or just before closing.

Servicers must also provide additional information about the costs of taxes and insurance, as well as late fees and warnings about certain features, such as early prepayment penalties. The rule also prohibits increases in charges from lenders and their companies that do not allow the consumer to shop unless a certain exception applies.

The CFPB’s latest TILA-RESPA guide is available at the agency’s website.

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