Elizabeth Warren, President Obama's newly appointed adviser of the Consumer Financial Protection Bureau (CFPB), and Treasury Secretary Tim Geithner hosted a forum Monday to seek input on the simplification of mortgage disclosure forms. Under the Dodd-Frank Act, the CFPB is charged with combining and simplifying the disclosure forms that lenders are required to provide to applicants under the Truth in Lending Act and the Real Estate Settlement Procedures Act.
The forum included consumer advocacy groups, housing counselors, financial literacy experts, mortgage companies and other stakeholders, the Treasury says, adding that the feedback received at this and future meetings will be used to expedite the design and testing of new draft mortgage disclosure forms.
‘Moving quickly to improve mortgage disclosures is one in a series of concrete steps we're taking to implement the historic consumer protections included in the Dodd-Frank financial reform law,’ says Geithner. ‘Wherever possible, we are committed to expediting completion of the law's requirements ahead of statutory deadlines.’
Throughout the process, the CFPB implementation team will work with the Federal Reserve on pending proposals for TILA disclosures and other new disclosure requirements under the financial reform legislation to coordinate those projects, the Treasury says. Under the Dodd-Frank Act, the CFPB has until July 2012 to propose a consolidated disclosure form.
According to Warren, the disclosure forms, in their current form, are highly technical and difficult for borrowers to understand.Â
‘Streamlined disclosure can level the playing field and give families better tools to make better choices,’ Warren says. ‘This is particularly true in the mortgage market, where borrowers receive stacks of incomprehensible paperwork when they're looking for a loan.’
SOURCE: U.S. Treasury Department