Following our recent article about testing the integrated mortgage disclosure forms we received several inquiries requesting more information about the process, particularly about submitting a comment. This article responds to those requests.
The Issue – The volume of changes from the Dodd-Frank Act that are currently unfolding is daunting. Over 2,400 pages of proposed regulations have been published in just the past two months alone.
A huge bank can assign a team to the task of reviewing and commenting on the proposed regulations and complete the task in a reasonable amount of time. Many community banks have a one-person compliance department, and often that person has other duties, in addition to compliance. There is no way such a bank can begin to seriously review all of the proposed regulations.
The Solution – So what should a community bank do? All of the proposals are important. Implementing each proposal will strain both your time and dollar budgets. So pick one or two proposals that are of the greatest importance to your bank.
Based on the numerous complaints about the GFE and the HUD-1 I have fielded over the past 30 months, the issue of greatest concern may be the new forms that replace those old forms. The proposed rule for the Loan Estimate and Closing Disclosure covers 1,099 pages. Reading this monster, gaining an understanding of the requirements, and trying your hand at completing the new forms is probably more than a typical community bank can complete in the time allowed. But this may be the best use of a compliance officer’s time. We will likely have to live with the new forms for years to come.
The process for testing the forms is relatively easy. Select several mortgage loans recently made by your bank. Extract information from the current disclosures and place that information appropriately in the new disclosures. Portions of the new forms are very similar to existing forms and the information will transfer line-for-line. Other sections are quite different and it will be necessary to consult the instructions to complete the task.
The task will be time consuming and will present some difficulties, but it will reveal problems in the new forms and sections of the instructions that need to be improved.
The New Forms – The first new form (the Loan Estimate) is designed to provide disclosures that will be helpful to consumers in understanding the key features, costs, and risks of the mortgage for which they are applying. This form will be provided to consumers within three business days after they submit a loan application. The second form (the Closing Disclosure) is designed to provide disclosures that will be helpful to consumers in understanding all of the costs of the transaction. This form will be provided to consumers three business days before they close the loan.
The Loan Estimate – The Loan Estimate form replaces two current Federal forms – the Good Faith Estimate under RESPA and the early Truth in Lending disclosure under TILA. The proposed rule and the Official Interpretations contain detailed instructions as to how each line on the Loan Estimate form would be completed.  There are sample forms for different types of loan products.  The Loan Estimate form also incorporates new disclosures required by Congress under the Dodd-Frank Act.
The Closing Disclosure – The Closing Disclosure form replaces the current form used to close a loan, the HUD-1, which was designed by HUD under RESPA. It would also replace the revised Truth in Lending disclosure designed by the Board under TILA. The proposed rule and the Official Interpretations contain detailed instructions as to how each line on the Closing Disclosure form would be completed. The Closing Disclosure form contains additional new disclosures required by the Dodd-Frank Act and a detailed accounting of the settlement transaction.
Tools to Assist – We have developed a few items that will make the job easier. We have pulled blank forms from the proposed regulations and have them ready for you to print. We have also published a 200-page guide to Completing the Loan Estimate and Closing Disclosure.
Click here for the blank forms.
The guide is available here.
Completing the Process – Once you have completed the model forms you should share your results with the CFPB. Submitting a comment has become quite simple with automation. Simply follow these steps:

  1. Log into to
  2. Search for the regulation. I searched for CFPB and Regulation Z and Integrated, and the regulation was at the top of the list.
  3. Click on the regulation upon which you wish to comment.
  4. Click Comment Now.
  5. Complete at least the mandatory fields in Section 1.
  6. Enter your comments (up to 2,000 characters) in Section 2 or attach longer comments in Section 3.
  7. Click Submit in Section 4.

Conclusion – If you take the time to complete the model forms and share your thoughts with the CFPB you have done your part to improve the new forms. If the CFPB adopts your suggestions you have made a positive difference in the world of compliance. If the CFPB does not adopt your suggestions then you have earned the right to complain about the new forms and the instructions for completing the forms.
This is a tough assignment, but it is an assignment that allows you to make a positive contribution to the regulatory environment. Your contribution will benefit the industry for years to come. Working through the assignment also prepares you to implement the forms in your institution in the months to come.
Good luck with the assignment.