THE NEW HUD
I took a continuing education class about the new HUD that will be in use at the beginning of 2014. Are you ready for it? Is your lender ready for the change? Is your title company or escrow company ready?
Why, you ask? Well, the new HUD that will be used at closing is much different than what we currently are accustomed to. The software your lender and title/escrow companies currently use will not work with the new changes. Are they working on making the changes? Will you be able to take care of your buyers and sellers next year? My preferred lender and title company have already started modifying their current software.
For the first time, HUD will have a boss to "report to". The Bureau of Consumer Financial Protection, otherwise know as the CFPB, was established by Congress through the Dodd-Frank Wall Street Reform and Consumer Protective Act, known as the Dodd-Frank Act. Their responsibility is to educate, enforce and study the consumers, financial service providers and consumer financial markets. It was also established to protect the consumer. The CFPB will monitor the financial market for new risks to the consumer. They will write laws and take consumer complaints! Yes, that's right. Take complaints! The CFPB has the exclusive authority to issue regulations and enforce consumer protection laws such as Truth-in-Lending, Electronic Fund Transfers Act, and RESPA, to name a few.
The GFE (Good Faith Estimate) and the HUD-1 and HUD-1A will be replaced by Settlement Disclosures. What we have been used to, looks completely different. The laws are not all written yet. A final Rule is supposed to be done by January 21,2014, however since they are only one third through the 3500 pages, there will most likely be an extension. Currently 250 new laws have been written, of which 100 of them are mortgage related.
My suggestion is that you take a class on the new HUD changes and follow up with your current vendors of choice to make sure they know the changes are coming and to find out if they will be ready.