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Daily Real Estate News | February 27, 2008
HUD Pushes Closing Estimate Reform
The U.S. Department of Housing and Urban Development is promoting rules that would force lenders to make closing costs easier to understand and reveal payments to mortgage brokers.
The proposal is less stringent than the one that failed in 2002, but still would require lenders to provide an accurate good faith estimate that doesn’t change by more than 10 percent.
The most controversial portion of the proposal would require any lender payments to mortgage brokers to be noted on the good faith estimate.
Marc Savitt, president-elect of the National Association of Mortgage Brokers, opposes the rule change because he says it would be confusing to borrowers. "HUD's goal was to simplify the mortgage process, and what they are doing is anything but simplifying the process," he says.
Source: Reuters News, Diane Bartz and Patrick Rucker (02/26/08)
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