The Mortgage Bankers Association (MBA) filed two comment letters with the Federal Reserve regarding two proposed rules that would amend the Truth in Lending Act (TILA).Â
According to the MBA, the first proposed rule under Regulation Z, which implements TILA, would ‘significantly revise consumer disclosures for open-end home-secured credit or home equity lines of credit (HELOCs).’ The second change, MBA continues, would ‘change the procedural format, timing and content of disclosures given to consumers for closed-end credit at the time of application, within three days after application, three days before consummation and during the life of the mortgage.’
In its letters, MBA questioned new provisions that might increase costs and requested additional time for lenders to implement the proposed rules.
‘In order to comply, lenders will need to obtain information and data from third parties, such as title agents, to provide the requisite disclosures to consumers,’ the MBA says. ‘Generic disclosures, developed for a range of HELOCs, would provide sufficient information at less cost to consumers at the application stage. Following application and underwriting, at the application stage, the creditor will be prepared to provide more definite information on the exact rate and terms of the HELOC offered.’
SOURCE: Mortgage Bankers Association