RESPA GFE Revamp Proposal Coming Soon

The Department of Housing and Urban Development is very close to sending a RESPA proposal to the Office of Management and Budget that revamps the good-faith estimate and HUD-1 settlement sheet, according to a high-ranking HUD official.The Real Estate Settlement Procedures Act proposal will be shipped over to the OMB "very soon," HUD Assistant Secretary Brian Montgomery told MortgageWire. The proposal includes a standard GFE form to create more consistency in the initial disclosure that mortgage applicants receive from lenders on the costs of a mortgage transaction. The GFE will be comparable to the HUD-1 settlement sheet, and fees that might change before closing are grouped together. Increases should not exceed certain tolerances, which are also disclosed to consumers. HUD also plans to ask Congress to amend RESPA to require that borrowers receive closing documents sooner and to increase civil monetary penalties.