CFPB Proposes New Effective Date for Know Before You Owe Mortgage Rule
The Consumer Financial Protection Bureau (CFPB) has issued a proposed amendment to the new Know Before You Owe mortgage disclosure rule, which proposes to move the rule's effective date from August 1 to October 3, 2015.
The Know Before You Owe rule, also called the TILA-RESPA Integrated Disclosure rule, requires easier-to-use mortgage disclosure forms that clearly lay out the terms of a mortgage for a homebuyer. The rule replaces the existing federal disclosures and is designed to help consumers better understand their mortgage options, choose the deal that's best for them, and avoid costly surprises at the closing table.
According to the CFPB, it is issuing the proposed amendment to correct an administrative error that would have delayed the effective date of the rule by at least two weeks.
The CFPB is proposing a new effective date of Saturday, October 3. The Bureau says it believes that moving the effective date may benefit both industry and consumers with a smoother transition to the new rules.
The Bureau further believes that scheduling the effective date on a Saturday may facilitate implementation by giving industry time over the weekend to launch new systems configurations and to test systems. The Bureau says that a Saturday launch is also consistent with existing industry plans tied to the original effective date of August 1.
A copy of the CFPB proposal is available here. It will be open for public comment until July 7.