April 08, 2015

The Consumer Financial Protection Bureau (CFPB) has released a new toolkit that guides consumers through the process of shopping for a mortgage and buying a house.

Developed as part of the CFPB's 'Know Before You Owe' mortgage initiative, the toolkit is designed to help consumers take full advantage of the new Loan Estimate and Closing Disclosure forms that lenders are required to begin providing in August.

"This toolkit is a great resource for consumers navigating the home-buying process, and will help consumers make well-informed decisions about the biggest financial transaction of their life," said CFPB Director Richard Cordray. "The new mortgage disclosure forms coming in August will help consumers comparison shop for mortgages and avoid surprises at the closing table. We are releasing this toolkit well in advance of the effective date to help the mortgage industry come into compliance with the new rules."

The new mortgage shopping toolkit provides a step-by-step guide to help consumers understand the nature and costs of real estate settlement services, define what affordable means to them, and find their best mortgage. The toolkit features interactive worksheets and checklists, conversation starters for discussions between consumers and lenders, and research tips to help consumers seek out and find important information.

The CFPB says that the toolkit is intended to replace an existing booklet that creditors currently must provide to mortgage applicants, which was initially developed by the Department of Housing and Urban Development (HUD).

The updated toolkit is designed to be used in connection with the new Loan Estimate and Closing Disclosure forms that will be effective on August 1, 2015. Creditors must provide the toolkit to mortgage applicants as a part of the application process, and other industry participants, including real estate professionals, are encouraged to provide it to potential homebuyers.

The CFPB is also providing an electronic version complete with fillable text fields and interactive check boxes so that the consumer can save and print their progress as they work through the toolkit. The electronic version meets federal accessibility standards to ensure that all consumers, including those with disabilities, can use the resource. The CFPB encourages lenders to keep this level of accessibility when delivering the PDF to consumers.

A Spanish language version of the toolkit will also be made available later in 2015.

The CFPB is providing the toolkit well ahead of the August effective date for the 'Know Before You Owe' mortgage disclosure rule to give industry time to order and receive or print the new toolkit and integrate electronic versions into their mortgage origination systems.

Your Home Loan Toolkit (designed for web posting and interactivity) is available at:http://files.consumerfinance.gov/f/201503_cfpb_your-home-loan-toolkit-web.pdf

The electronic version of the toolkit is available here:https://www.consumerfinance.gov/learnmore/#respa