The Consumer Financial Protection Bureau (CFPB) announced on Dec. 13 that it’s one step closer to its goal of simplifying mortgage forms, with its most recent attempt to combine the HUD-1 Settlement Statement and final Truth-in-Lending disclosure forms consumers get when closing a mortgage.
The bureau released two different designs detailing closing costs and transaction items, with one form similar to the existing HUD-1 settlement statement that consumers currently receive when closing a mortgage loan, and the other based on its prototype for the disclosure consumers get when they first apply for a mortgage.
En route to the latest forms, the CFPB included disclosures required by the Dodd-Frank Act and some changes to make it easier to understand and use along with the application disclosure, as well as a “fresh, updated look” to the design.
The two prototypes that emerged in November displayed closing costs in a format similar to the current HUD-1, says the CFPB, and although consumers and industry professionals found them “easy to navigate,” they also left more than 3,000 comments, which the bureau used to make improvements in a single new prototype that’s based off of the previous round’s designs.
The latest installation provides the same information as the other prototype, but in a format that uses the CFPB’s application disclosure prototype, with sections that correspond to the application disclosure and use simpler language.
“We’re wondering if this design will make the disclosure even clearer and easier for consumers,” the CFPB said in its announcement before asking for suggestions for design improvements.
Go here to compare the two forms.
Written by Alyssa Gerace