independent community bankers of america (ICBA) and 42 affiliated State Banking Associations are calling consumer financial protection bureau (CFPB) to approve language that allows community banks to test various consumer construction and construction-to-permanent loan disclosures, which the group described as “a core offering of community banks in many local communities.” does.
Thank you for reading this post, don't forget to subscribe!The proposed template Truth in Lending Act (TILA) – would replace mortgage disclosures required under the Real Estate Settlement Procedures Act (RESPA) Integrated Disclosure (TRID) rules. The group said in formal comments and a joint paper that the changes would potentially benefit both lenders and the consumers they serve.
“The ICBA, along with a team of community bankers and technology vendors, collaborated with bureau staff over two years to develop these revised TRID disclosures,” said the letter sent by the group to CFPB director Rohit Chopra. Did.” “getting [these] The goals will help encourage community banks to expand construction-to-permanent mortgage lending activity, particularly in smaller cities and rural markets.
In addition, the current language regarding TRID disclosure focuses primarily on home purchases and mortgage refinance loans and does not adequately address the unique needs of construction loans, ICBA said.
ICBA President and CEO Rebecca Romero Rainey said in a statement, “The ICBA and our affiliated state community banking associations urge the CFPB to allow community banks to test updated mortgage disclosures that are more accessible to lenders and borrowers alike. will significantly improve the process. “The proposed template will provide greater clarity to consumers, streamline the process through improved disclosure requirements, and expand access to more affordable homes in rural areas with limited housing supply.”
The association said the proposed template language would modify current loan estimates and completion date disclosures to include construction phase details, cost breakdowns and other disclosures related to construction-to-permanent debt financing.
“Streamlining the TRID mortgage disclosure process for single-close construction-to-permanent loans will help facilitate access to these loans, saving time for lenders and cost savings for consumers,” ICBA said.
One goal for the revised language is to encourage community banks to pursue additional mortgage lending business within the scope of construction loans, according to formal comments presented by Ron Heaney, SVP of mortgage finance policy at ICBA.
“We therefore urge the Bureau to approve this proposal and allow ICBA and community bank lenders to conduct extensive testing of these new disclosures to validate their use and benefits,” Heaney said in formal comments submitted to Chopra. Give.”
