With the January 10 effective date
closing in the Consumer Financial Protection Bureau (CFPB) is reminding
consumers and lenders of the numerous materials and resources it has available regarding
its new mortgage rules.
letters. Two templates are provided to help consumers
find solutions to problems with their mortgage servicers. One is suggested for use in requesting that a
servicer correct an error and the second for requesting information from a
There are a number of different tips on new rights under the new rules for
homebuyers and homeowners at every stage of the mortgage process-from taking
out a loan to paying it back. The tips also include recommendations for
troubled borrowers facing foreclosure.
Factsheets: There are several,
offering overviews of new consumer protections and summaries of new procedures
to facilitate borrowers' access to foreclosure avoidance options.
Consumer Tools: CFPB also reminds consumers of the tools available on its
website including AskCFPB, an interactive page that can provide answers to
mortgage related questions and another interactive tool to help consumer find
local housing counseling agencies or submit a complaint regarding a financial
new resource was released today titled Ability
to Repay Rules: Protecting Consumers
from Debt Traps. The three-page publication
summarizes the new rules defines Qualified Mortgages and explains the rationale
for the new rules, saying in part: "Certain types of mortgages
are more likely
to become a debt trap for the borrower,
the new rule lays out basic guidelines that lenders can
follow. They give lenders greater
certainty that they are meeting
the Ability-to-Repay requirement.
If lenders choose not the follow these guidelines,
they can still make a loan
based on their reasonable, good-faith determination that
the borrower has the ability
to repay it. Bottom line: The Ability-to-Repay rule is
intended to prevent consumers from getting trapped in mortgages that they
cannot afford, and to prevent
lenders from making loans that consumers do not have the ability to repay.
It's that simple."
a section called "Fact or Fiction" the new publication addresses seven "fictions"
about the rules such as that they will require 20 percent down payments, make
loans unavailable to the self-employed; put a hard cap on debt to income ratios,
or drive smaller lenders out of business, and presents "facts" to refute each.
CFPB Director Richard
Cordray said, "Taking out a mortgage to buy a home is one of the biggest
decisions a consumer can make. We want
to make sure that people are aware of their new protections so they have the
knowledge to make sound decisions about their financial futures."
The materials are available on the
Bureau's website (www.CFPB.gov).