In moves intended to help future homeowners, the Consumer Financial Protection Bureau in Washington is proposing to change the types of forms a borrower receives before signing up for a home loan. The bureau is also proposing to expand the definition of what is considered a “high cost” mortgage.
The bureau said that it’s new “loan estimate” and “closing disclosure” forms will present the costs and risks of getting a home loan to borrowers better than the ones that currently exist.
“When making what is likely the biggest purchase of their life, consumers should be looking at paperwork that clearly lays out the terms of the deal,” Richard Cordray, director of the bureau, said in a news release announcing the proposed changes. “Our proposed redesign of the federal mortgage forms provides much-needed transparency in the mortgage market and gives consumers greater power over the exciting and daunting process of buying a home.”