Simplifying mortgage disclosure forms so that borrowers get a clearer picture of the costs and obligations involved will be a primary goal of the new Consumer Financial Protection Bureau and Elizabeth Warren, the consumer advocate appointed to oversee its creation.

Warren, a Harvard law professor appointed by President Obama, has been a vocal critic of what she calls “tricks and traps” in mortgage contracts and other credit agreements that bury the essential details of a loan or credit card agreement in mountains of text.

Obscured by fine print

“Fine print obscures the cost of credit and makes it impossible for families to compare products,” Warren said, opening a forum on simplifying mortgage forms. “Too often, families come to understand the legalese only when they get bitten by it. Streamlined disclosure can level the playing field and give families better tools to make better choices.”

Warren said this was particularly true with mortgages, where “borrowers receive stacks of incomprehensible paperwork when they’re looking for a loan.”

The forum, held Tuesday in Washington, D.C., was designed to seek imput on how mortgage disclosure forms might be simplified. Participants included consumer advocacy groups, housing counselors, financial literacy experts, mortgage companies, and other stakeholders. Future stakeholder meetings are planned to help refine the document design.

Combining two mortgage disclosures into one

Washington, D.C., Sept. 23, 2010 — The American Land Title Association (ALTA) announces that its second-quarter Market Share Analysis is now final. ALTA released preliminary results on Sept. 2.

The second quarter of 2010 proved to be profitable for the industry. Operating Income was down 9 percent from the second quarter of 2009 and Loss Expense was up by 12.7 percent, but these were offset by a decrease in Operating Expense of $248 million (10.6 percent), leaving Operating Loss at the same level as 2009. Net Investment Gain was 45 percent less than 2009, leaving Net Income 56 percent lower than the second quarter of 2009, but still positive at $48.3 million.

Consequently, the industry remains in a strong financial position at June 30, with Admitted Assets of over $8.5 billion, including over $7.4 billion in Cash and Invested Assets. Also, Statutory Reserves were almost $5 billion and Statutory Surplus exceeded $2.4 billion.

The second quarter of 2010 ends a string of three consecutive quarters in which Title Premiums Written increased over the prior year’s equivalent quarter, reporting a decline of 8.5 percent compared to the second quarter of 2009. Notable in the second quarter are changes in title insurance underwriter family market share. The Fidelity Family leads the industry with 38.4 percent of the national market, up 1.4 percent from the first quarter. Meanwhile, First American declined 1.7 percent to 26.6 percent, Stewart increased 1 percent to 14.7 percent. Old Republic decreased .1 percent to 10.4 percent and regional companies decreased by .8 percent to 9.9 percent.

ALTA expects to release preliminary third-quarter Market Share Analysis around Dec. 1.

Posted via email from Title Insurance
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HUD page 4 question

September 22, 2010 admin

Could someone please provide the following correct information..????

I deal with 5-6 different lenders and I have seen page 4 of the HUD prepared 3 different ways…

#1 The YSP is showing as a credit “Paid to the Borrower”

#2 The YSP is showing as a credit “Paid to the lender”

#3 The YSP is showing as a credit “Paid to our Bank” (our loans are table funded)

I’ve experience considerable delays with some of my closing wires due to confusion that is created when companies do not complete page 4 of the HUD in a consistent manner. I was told that page 4 of the HUD is more for disbursement purposes and does not have to meet the same standards as pages 1, 2 & 3 on the HUD… I know it sounds nuts (you would have thought with all the RESPA changes there would only be “1” acceptable way to show the funds disbursements on page 4)….. Please let me know if any one else has or is encountering this same issue.. Thanks.

by Loan-er September 19, 2010 9:52 PM

i agree, the GFE/HUD-1 may have been constructed with good intentions, but is a mess. Every lender has a different interpretation, and a competent title agency is most important. the change of circumstance is another gem(gov’t at work).
by MikeM-NJ September 20, 2010 6:06 AM

Yes, the HUD-1 new HUD-1 form is a difficult beast to master. However, it only has 3 official pages, not 4. Page 2 is used to show loan originator charges and credits to the borrower for YSP in lines 801 and 802. Any additional pages detailing fees and costs are not required by RESPA.

It sounds like someone in your company (or at the companies you deal with) has created” a “page 4” for internal disbursement purposes. Perhaps it is simply the closer’s disbursement record. In any event, since it is not governed by the RESPA rules closers and others will fill it out in a way that makes sense to them, which will likely vary considerably.
by oldbe September 20, 2010 10:24 AM

Old be is right, you are going to see variances in the disbursement page. It is purely a rehash of page 2 fees showing where they are going, it does help on the title end when trying to balance a wire…
by Donktard Borker September 20, 2010 10:31 AM