Financial Sheriff Opens Up on GFE-TILA Forms

By Robert Freedman, Senior Editor, REALTOR® Magazine

The country’s newest banking regulator is trying to make it easy for practitioners and consumers to comment on a mortgage disclosure form. That’s a break from the past.

The new Consumer Financial Protection Bureau (CFPB) seems to be taking a different approach to its business as a regulator than the way regulators have traditionally done things. The agency was created as part of the massive Wall Street reform bill enacted into law last year to serve as a consumer watchdog of financial services companies. Although the agency has been in the works for a while, the mortgage debacle was the impetus for getting it off the drawing board and into the federal government as a functioning agency.


Of immediate importance to real estate, the agency assumes oversight of the Real Estate Settlement Procedures Act (RESPA) and the Truth in Lending Act (TILA), and the reason it seems to be doing things differently is the way it’s handling one of its first real estate-related tasks: consolidating the Good Faith Estimate (GFE) and the TILA disclosure form into a single, simplified form.

Since it was enacted into law in 1974, RESPA has been a function of the U.S. Department of Housing and Urban Development and the TILA disclosure form (which is mainly about disclosing in plain language how much your loan will actually cost you over the life of its term) has been a function of the Federal Reserve. Members of Congress over the years have instructed  HUD and the Fed to get together and coordinate with one another on their forms and rules, but the agencies have had mixed success in doing that. NAR has commented over the years that HUD’s efforts and the Fed’s efforts have not always synced up well.

At least on that basis, having RESPA and TILA under one roof promises to address the issue of coordination. Of course, the jury remains out whether the substantive actions of the agency make sense from the perspective of the real estate industry. Only time will tell on that.

But we now get to see how the new agency will approach things, and on that score, CFPB deserves credit for at least giving the appearance of doing things more openly. It’s seeking industry input into its effort to consolidate the GFE and the TILA disclosure form, but it’s also making it easy for consumers to provide input. That’s a step that’s worth applauding. Regulators have always asked for industry input, and they’ve asked for public input, too, but they’ve never done it in a way that was easy or intuitive. The solicitation was always buried in hard-to-understand bureaucratic language with little or no outreach to consumers. This new agency is using social media to bring its outreach directly to consumers, and it’s trying to put a consumer-friendly face on its efforts.

In any case, for the last couple of week’s, the agency has been soliciting input into its consolidated form and it wants to hear from you, although time is running out, with a May 27 deadline. It mainly wants to know if the consolidated form is easy for the typical consumer to understand.

You might want to take this opportunity to give CFPB your input. Click on this link, then click on the link that says “Switch to industry tool.”  When you do that, you’ll be given two versions of the form and asked for your thoughts on them.

Look at the substance of the consolidated form, too. If something isn’t clear, let the agency know.

Robert Freedman

Robert Freedman is director of multimedia communications for the NATIONAL ASSOCIATION OF REALTORS®. He can be reached at

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  1. I would like to know why the people are having to pay for something the Financial Institutions did. The people are still the same people, it was the Financial Institutions putting people in risky loans. It was not the people, the Institutions made Loans and figured wages would go up to compensate for their RISKY Lending, plus they were betting the people would fail so the PMI would pay them that 20%. So the Lenders are the only one that would WIN. If a Sell a House to a Buyer that is Discount to 65% of houses around it, that lowers all the Property values, I know in the CODES books somewhere it states that you can’t Build a $6,000,000.00 house in an area that he Values are $59,000.00 because that cost of construction would not be justified. By building that home you would instantly have a loss of $5, million dollars, SO is the Same for REO’s If you sell a house or two for $89.995.00 in an area of Houses listed for $459,995.00 you just lowered the Value of that area to about $229,00.00 and every person just lost $200,000.00 because of the Financial Institutions Betting against the Market. The reason it takes so long to Sell any of these properties is, the Financial institutions don’t own the Mortgages they are only servicing note sold to other investors, I would like to see if the original Notes could be presented on any of the Mortgages out there, not Copies. I know that the notes I own are made out to an Institution that is only collecting my payments for me, and that is how it is with all my Friends. When an Investor contacts the Bank about my loan it have to contact me to see if I want to take a Loss on my Investment, of course I am not going to do that. and that is why you can’t ever get a Straight answer out of a Bank for a Discounted sale, why an I going to take a Loss from what the Financial Institutions Created.
    It is a Joke how everyone is being told a Lie and covering up the Truth.

  2. Jean Osborne

    We do not see the opportunity for input from closing attorney’s and agents regarding the new GFE and TIL disclosures. Since the enactment, we have yet to see any two lenders interpret the forms the same. If they do not understand the new process how can it correctly be explained to the consumer.