The new forms from the new federal Consumer Financial Protection Bureau, put together using ideas from two previous types of paperwork, are now available for review on the agency’s website. Part of the Dodd-Frank Wall Street Reform and Consumer Protection Act mandates that the CFPB combine the two-page Truth In Lending forms with the three-page Good Faith Estimate’s, which are essentially designed to help consumers find the mortgage agreement that works best for them.
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The reason for the change is that much of the information provided in the two previous government documents overlaps, and often contains long lists of fees that may be difficult to parse, the agency’s website said. In addition, many of the technical terms used on the form may be difficult to understand for many potential borrowers.
“These disclosures don’t work if they give you too much information or if the information they provide isn’t what you need,” the site said. “They don’t work if they drown you in detail or leave out crucial information, like warnings about hidden risks.”
But mortgage disclosure forms aren’t the only focus for the CFPB, according to a report from the Austin American-Statesman. In addition, it is also working to make it easier for consumers to understand their credit card agreements.
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