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Many of you will remember the sweeping revision of the venerable HUD-1 form which went into effect in 2010 as well as the hours of retraining that we all went through to understand it. Since its formation, the Consumer Financial Protection Bureau (created by the Dodd-Frank Act) has been implementing forms to be used in place of several of the previously-standard residential loan closing forms, including the HUD-1. In July, 2012, the Bureau released a proposed rule regarding implementation of those forms. While it is impossible to summarize this 1,099 page document in a blog, there are a few key points to note. First, the traditional HUD-1 form and the final Truth in Lending disclosure are being replaced by a five page Closing Disclosure form. The new rules require this form to be delivered to the consumer at least three days before closing to allow for adequate review by the consumer. The rules place significant responsibility on the lender to accurately complete the form. Another change will be to the Preliminary Truth in Lending and Good Faith Estimate which the rule replaces with a form called the Loan Estimate.

The final date for implementation of the new rule is not yet certain but many commentators anticipate that it will be sometime in 2014. Many title underwriters have posted information about the new forms and the rule on their websites including The Fund. There are various links at its website, www.TheFund.com, which may be helpful to readers seeking more information.