New Lending Environment

Regulatory Changes and Your Real Estate Transaction

view of house through magnifying glassAs a result of circumstances leading to the housing bubble burst in 2008, regulatory changes were designed to protect consumers from unfair loans and scams. The Consumer Financial Protection Bureau (CFPB) is implementing the ability-to-repay/qualified mortgage rule, which creates a 43 percent debt-to-income (DTI) ratio for banks to follow in issuing qualified mortgages (QMs). This affects the process of getting a loan by creating more stringent lending standards, to ensure that home buyers aren’t taking out loans they cannot afford.


On October 3, 2015, the Consumer Financial Protection Bureau’s mortgage disclosure rule will go into effect on making it easier for consumers to shop for mortgages and protecting them from costly surprises at closing by integrating consumer disclosures. In addition to the loan process changes, the CFPB’s proposed rule integrating mortgage disclosures ensures you will get information about your potential loan in a timely manner (no later than three days after your loan application) and in an easier-to-understand format, the Loan Estimate Form. The new form is a result of the Dodd-Frank Act. It was created to:

  • Reduce the number of paperwork consumers receive
  • Make it easier to understand the terms of the mortgages offered
  • Provide the total costs of the loan prior to acceptance

Closing Disclosure Form

If you’ve been through a closing before, you’re going to notice changes in the process. Previous forms required by the government are being replaced with a single document, the Closing Disclosure Form. You will receive a copy of the form no less than three days prior to closing, so you have enough time to review prior to signing. It was designed to make it easy to understand the costs associated with the transaction and to make clear who’s responsible for paying each cost. The CFPB has also issued strict guidelines that must be adhered to by the third-party companies working with the lender in the transaction – including title and escrow services.

Title Insurance in Northern Colorado

When you’re ready to become a homeowner, call The Group Guaranteed Title at (970) 613-4364 and speak to the most experienced title officers and escrow officers in Northern Colorado. Our goal is to make the home selling, buying or refinance closing experience comfortable, fast, easy, and predictable.

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