14A — October 10 - 23, 2014 — M id A tlantic

Real Estate Journal


I nsurance /T itle

By Allen Meccia, Jr., First Bergen Title Agency Navigating the new integrated mortgage disclosure mandates

n July 2010, Congress passed – and President Obama signed – the Dodd- Frank Wall Street Reform and Consumer Protection Act, which led to the creation of the Consumer Financial Protection Bureau (CFPB). Established to consolidate most Federal consumer financial protection authority into one place, the bureau is focused on one goal: watching out for American consumers in the market for consumer financial products and services. In an effort to eliminate un- certainty inherent to today’s I

mortgage closing process, the CFPB issued amended rules and forms for all applications originated on or after August 1, 2015. The new forms use clear language and emphasize key information, from the interest rate and monthly pay- ments to costs to close the loan. Additional information also helps consumers determine loan affordability as well as comparative costs of different loan offers, including loan costs over time. It is important to note two major changes under the new TILA-RESPA rules. The first is

that the Good Faith Estimate (GFE) and initial Truth-in- Lending (TIL) disclosures have been combined into a new form, known as the Loan Estimate. Designed to provide disclosures of key features, costs and loan risks, this formmust be provid- ed to consumers no later than the third business day after a loan application is submitted. The second change involves the HUD-1 and final TIL. Both have been combined into an- other new form – the Closing Disclosure, which details all of the transaction costs. This form must be provided to con- sumers, physically or electroni- cally, at least three business days prior to closing the loan. If changes occur between the time the form is delivered and the closing, a new formmust be provided and the consumer has three additional business days to review, possibly delaying a scheduled closing. In advance of this “New Era in Closings,” attorneys, lend- ers, title and settlement service providers and information technology companies span- ning every sector of real estate are busy preparing for these new processes. For example, at First Bergen Title Agency, a full-service family-owned and operated title insurance agency, the executive lead- ership team is investing in professional education and development of its staff well in advance of the implementation deadline. The new integratedmortgage disclosures are the CFPB’s solution to adding transpar- ency to the closing process. All involved in the closing of real estate transactions will need to adjust to the new forms, new timing issues and the produc- tion of a Closing Disclosure rather than a HUD-1 form. Title agencies like First Bergen Title Agency, which has been through industry changes and varying market cycles during the past several decades, are already ahead of the curve in terms of staff education. Once the new disclosures are implemented, seek out these experts who can provide in- depth settlement assistance and paralegal services during this transition. AllenMeccia, Jr. is a man- aging member of First Ber- gen Title Agency LLC in Hackensack, NJ, whose experience spansmore than 30 years. n

Managing members Leo Foose (left) and Allen Meccia, Jr.


• Providing title insurance protection and settlement services • Specializing in residential, commercial and industrial properties • Single-source solution for real estate purchases, refinances and leasehold transactions • Facilitation of 1031 Exchanges in cooperation with nationally recognized company • Affiliated underwriters include Chicago Title Insurance Company and Commonwealth Land Title Insurance Company, members of the Fidelity National Financial family of title companies, as well as Old Republic National Title Insurance Company

Court Plaza North, 25 Main Street, 2nd Floor, Hackensack NJ 07602 201-343-3121 www.firstbergentitle.com

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