The Massachusetts Association of Buyer's Agents (MABA) is more supportive of
two other CFPB proposals – one pertaining to loan origination fees, the other designed to prevent mortgage servicer mistakes. However, they see a need for more consumer education and support when choosing a mortgage product.
A key element of the new loan origination rules requires lenders to offer a no point, no fee option. The Consumer Financial Protection Bureau (CFPB) aim is to create transparency to help consumers mortgage shop. However; as the MABA board sees it, the real issue here is that many consumers don't understand how loans are really structured and, thus, have a hard time making comparisons.
Do you agree with the MABA board that consumers do not understand their mortgages and cannot or do not have the time to get up to speed on how to shop for a loan?
Regarding the proposed new rules on mortgage servicers, the MABA board said: "Fundamentally, these rules are designed to protect homeowners from surprises and costly servicer mistakes. It's a good step in the right direction. One question not answered, though, is what happens if the lender does not follow the correct steps and forecloses on a homeowner." The board recommends that there be a requirement that lenders present proof that all procedures were properly followed in a timely manner before they would be able to complete a foreclosure. "The bottom line: none of these rules will work unless there are timelines attached to them and penalties or incentives that will get the lenders to follow them."
The MABA board of directors plans on submitting its comments to the CFPB shortly for its review. The public has been invited to comment on the new CFPB proposals at its website. The CFPB will review and analyze all comments prior to issuing final rules in January 2013. The specific CFPB proposals referenced above can be accessed online here.
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