I was looking around the Consumer Financial Protection Burea site.
The CFPB is the new federal agency that Elizabeth Warren invented and set up, and Rich Cordray has been named to run.
Richard Shelby (R, Lenders) has vowed to fight the CFPB, presumably because he’s opposed to the idea of both parties to a contract understanding the terms of that contract. That would be horrible, if borrowers understood contract terms as completely as lenders do. Must tilt playing field towards lenders or they all crawl under their desks and start weeping at the unfairness of it all. It’s a hard, hard world out there, and they’ve gotten used to an awful lot of coddling.
Two areas on the CFPB site may be of interest to Balloon Juice readers.
The CFPB has been “market testing” a simplified mortgage disclosure form. The voting period ended on August 10, so BJ readers missed the deadline and won’t be able to vote in the current round.
The CFPB wants to know which form is most helpful to borrowers.
Some background:
What is a mortgage disclosure form?
For most Americans, buying a home means taking out a mortgage loan. If you recently applied for a mortgage loan, you received two forms required by federal law: A two-page Truth in Lending disclosure form and a three-page Good Faith Estimate. They’re supposed to help you pick the mortgage product that’s best for you. But if you’ve actually applied for a mortgage recently, what you probably remember most are lots of technical terms and long lists of fees.
These disclosures don’t work if they give you too much information or if the information they provide isn’t what you need.
Why are you combining the two forms?
The Dodd-Frank Wall Street Reform and Consumer Protection Act, which created the Consumer Bureau, mandated that we combine these two forms into one. So, we are going to combine the two forms into one and make them simpler to understand.
Here are the two proposed forms. Azalea or Camellia (pdf)
Here are the factors we are to consider when choosing the better form:
Would this form help consumers understand the closing costs associated with their loans?
Could lenders and brokers clearly and easily explain the form to their customers?
What would you like to see improved on the form? Is there some way to make things a little bit clearer?
The second area that may be of interest is an online complaint form for people who have a problem with a credit card. That’s here.
h/t Credit Slips
Thoughtful Black Co-Citizen
Ahem:
(Sorry, in full editor mode right now.)
Otherwise, thanks for sharing this.
Kay
@Thoughtful Black Co-Citizen:
Well, now that you’re editing I think you have to give me the fix :)
L. Ron Obama
@Kay: no u
Kay
@L. Ron Obama:
Oh, thanks.
something fabulous
@L. Ron Obama: I read *that* as youngster text-speak for, “No, you!”
dmsilev
While it’s too late to vote, I think I like the Camelia better, mainly because it breaks out some of the additional costs in more detail than the other. Either form, though, is a vast improvement in legibility compared to the current state of affairs.
Kay
@dmsilev:
I picked Azalea. I want someone to use the credit card complaint form and report back.
Villago Delenda Est
Well, if you allow borrowers to understand the terms of the loan, the next thing they’ll do is hold a gun to the head of the lender and force them to make a loan.
It’s inevitable. It’s how the entire housing bubble happened…millions of uncreditworthy brown people forcing lenders, at gun point, to make loans.
No One of Consequence
Who the hell loaded the Tag Cannon and fired a full-spread at this thread?
– NOoC
dpCap
Is seems like this is the same issue with the NRA’s insane position on guns.
You know… keeping guns out of the hands of convicted felons should be uncontroversial…
jon
Speaking of the fun of contracts, this is going to be interesting.
Part of me says “Die, corporate scumbags!” while another part wonders if this new media stuff is really going to be any less controlled by other corporate scumbags. I’m happy knowing that there are far more creators than ever who can get heard by more people, but the ways in which they meet the masses aren’t any less corporate-owned by self-destructive asshole control-freaks as the guys who put up with Phil Spector for all those years.
Southern Beale
@L. Ron Obama:
PEDANT ALERT!
:-)
Look, if both parties to a contract understand the terms of said contract then the party with the POWER cannot later blame the party WITHOUT POWER when it all goes down the shitter.
That’s why.
Moik
I’d vote for Camellia – memories of Sanjuro.
Fucen Pneumatic Fuck Wrench Tarmal
i am reminded of the sage words of george carlin, who theorized that if honesty were suddenly interjected into american life, the whole system would collapse.
as far as making a set of guidelines, or a form that explains things so the average american can understand? i applaud the effort, but the prevailing american attitude is that if i don’t understand it, it can’t possibly apply to me.
that said, if they can come up with a form that can be concise for the unwired reader, but another that goes into detail, section by section, perhaps on this internet thingy, perhaps with a mandated time to respond, something like a waiting period, or a cooling off period. i do believe consumers might have a fighting chance. that is, versus the current bum rush you get to sign, the one that discourages reading, much less further reading. i mean if they are pushing a waiting period for abortions, they can’t oppose them for consumer contracts? amirite?
kay
@Southern Beale:
What makes me laugh about the whole thing is how benign it is. To listen to media and conservatives, Warren was seizing the financial system with her iron fist.
It’s a site with consumer information, basically, and a coupla tools. I mean, Jesus. Just no connection to reality, at all.
This wouldn’t have been controversial just ten years ago. Now it’s AN OUTRAGE .
TooManyJens
Who was the BJer who just got their credit limit decreased by BoA for no reason? That would be a perfect use for the credit card complaint form.
Superking
I am skeptical that consumers will ever understand the terms of their loans in the way the banks do.
Swellsman
When Jon Stewart ultimately gets around to having Rich Cordray on as a guest, I will be highly disappointed if the first thing out of Stewart’s mouth isn’t something along of the lines of: “You look a lot different than when you worked here as a Daily Show Correspondent.”
KenZ
The problem with both forms is that they violate prior financial regulations (RESPA). So if mandated by the CFPB without a new law rolling back the RESPA disclosure requirements, banks would send you the new form and the old forms. Not very helpful.
Roger Moore
@dpCap:
The idea of keeping guns out of the hands of convicted felons is uncontroversial. If you could do it by casting a spell that made guns disappear the moment a felon bought them, the NRA would love it. The problem is the NRA keeps getting hung up on the practical steps you have to take to make it happen. It involves things like criminal background checks, which means the government needs to know whenever somebody is buying a gun, and not letting people casually buy and sell guns whenever they please.
Skippy-san
1) I just got my credit limit reduced by BOA for no reason.
2)Living here in Alabama=I can tell you all of the Alabama congressional delgation sucks. Shelby is the worst.
3) Alabmans don’t care about anything important-they even put the NFL to college football.
opie jeanne
Nothing to see here.
JRon
Kay, this is OT, but I thought of you when posting this one:
http://tumblr.com/xx944w07qa