Bob Khalsa: Realtors Help Unveil Home Loan Tools

Realtors recently joined with the head of the Consumer Financial Protection Bureau to highlight the federal agency’s “Know before You Owe” initiative as changes are being implemented to the mortgage closing process.

The agency rolled out a set of online tools to help consumers get better acquainted with what the Know Before You Owe initiative means for them.

The new tools are intended to improve consumers’ understanding of the mortgage process, aid in comparison shopping and help prevent surprises at the closing table. Rule changes associated with Know Before You Owe took effect Oct. 3.

As part of this initiative, the Truth in Lending Act – Real Estate Settlement and Procedures Act Integrated Disclosure rule, or TRID, will integrate existing closing disclosures with new requirements from the Dodd-Frank Act.

The CFPB’s online tools are directed at consumers who may still be unaware of the Know Before You Owe initiative. The tools are available online at: www.consumerfinance.gov/owning-a-home.

“The journey to home ownership begins with Realtors, and CFPB’s new online tools are a great resource for agents to help clients shop for a mortgage and prepare for the changes coming their way,” said Elizabeth Mendenhall, vice president-elect of the National Association of Realtors, who joined CFPB Director Richard Cordray in announcing the new online tools.

“Our new mortgage forms reduce the information gap between lenders and consumers, shedding light on a process that often feels like a mystery,” Cordray said. “It is time consumers have more power in the mortgage process, and our new forms and online tools will help make that a reality.”

The toolkit offers a guide to the new mortgage closing forms, a closing factsheet, a disclosure timeline and educational videos to assist consumers.

Realtors across the country have worked through the summer to educate themselves on rule changes related to Know Before You Owe so they can continue providing expert advice to clients as the new rules go into effect.

The CFPB has responded to concerns from NAR and others in the industry by announcing it would be “sensitive” to companies making a good-faith effort to comply with the new rules.

“CFPB’s cooperation is important to ensuring Realtors have what they need to educate clients on what’s ahead,” Mendenhall said. “We look forward to working with CFPB in the months ahead to ensure Realtor concerns are considered throughout implementation and thank them for their continued attention to our issues.”

Bob Khalsa is President of the Santa Clarita Valley Division of the 9,100-member Southland Regional Association of Realtors. David Walker, of Walker Associates, co-authors articles for SRAR. The column represents SRAR’s views and not necessarily those of The Signal. The column contains general information about the real estate market and is not intended to replace advice from your Realtor or other realty related professionals.