The nation's top thrift regulator says the mortgage application and settlement process is so "convoluted and non-understandable" to consumers that it needs to be changed.James Gilleran, director of the Office of Thrift Supervision, told the Exchequer Club that he supports the Department of Housing and Urban Development's effort to reform its Real Estate Settlement Procedures Act rules. The OTS director remarked that Fannie Mae chairman and chief executive Franklin Raines had admitted privately that he couldn't understand the process when he recently refinanced his own home. "If Frank Raines doesn't understand it -- who does?" Mr. Gilleran said. "We have devised a system that doesn't make sense, and it should be changed." A Fannie Mae spokeswoman said Mr. Raines could not be reached for comment by MortgageWire's deadline.

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