Will the New Disclosure Date for Mortgage Terms Lead to Delays?

Bob Tedeschi has an interesting column in today's Times about the impact of the new rule that obliges lenders to provide the final TILA disclosures for mortgages three days before closing, as opposed to the old rule that they could be provided at the closing itself.  The headline, New Law May Cause Delays for Borrowers, tells the story.  The reason for the delays?  If interest rates change between the time of the disclosure and the closing, the disclosures have to be made all over again, which would start the clock running again. See, e.g., Statement of Jack M. Guttentag, University of Penn. Wharton School of Business, at the Federal Reserve Board Public Hearing, Building Sustainable Homeownership: Responsible Lending and Informed Consumer Choice 135 (June  9, 2006) (“the prices in this market are volatile. They change every day.”). Of course, lenders could go ahead with the closing at the rates that were previously disclosed.

Comments

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[john beck]

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