Consumers Stand to Win Big With ‘Know Before You Owe’ Rule

Published Aug 03, 2016

Since the October 2015 implementation of the Consumer Financial Protection Bureau’s ‘Know Before You Owe’ mortgage initiative, Realtors® have raised red flags over challenges in gaining access to what’s known as the mortgage “closing disclosure” form, or CD. The CD is delivered to homebuyers in advance of their closing and contains important financial information related to their purchase.


Unfortunately, many lenders have chosen to withhold this document from real estate agents since Know Before You Owe went into effect, despite a longstanding tradition of sharing similar information.


Earlier this year, the CFPB announced that it was considering changes to Know Before You Owe -also known as the TILA-RESPA Integrated Disclosure, or TRID — including a clarification of the rules regarding sharing the CD.


Today, the CFPB made good on that promise when it announced a proposed rule on TRID, and stated in their announcement that “the Bureau understands that it is usual, accepted and appropriate for creditors and settlement agents to provide a closing disclosure to consumers, sellers and their real estate brokers or other agents.”


The National Association of Realtors® believes this announcement marks significant progress for consumers, as well as for its members. Giving Realtors® access to the CD would strengthen consumers’ understanding of their mortgage and home purchase by helping agents continue to provide expert advice to their clients.


The following is a statement by NAR President Tom Salomone:


“Realtors® have reported challenges gaining access to the Closing Disclosure ever since TRID went into effect, despite a long history of access to the substantively similar HUD-1 that is replaced. Today the CFPB acknowledged that concern by making it clear that it is appropriate and accepted for creditors and settlement agents to share the CD with consumers, sellers and their real estate agents.”


“This is a significant victory that will help Realtors® continue to provide the expert service their clients have come to expect. We appreciate the CFPB’s willingness to reconsider the TRID-related challenges our members face and will continue to monitor the progress on this important issue in the months ahead.”