Pub. 4 2015 Issue 2
l e a d i n g a d v o c a t e f o r t h e b a n k i n g i n d u s t r y i n k a n s a s 6 F OR OVER THIRTY YEARS, TWO REGULATIONS have impacted the closed-end mortgage loans provided by banks for consumers: the Truth in Lending Act, which was originally implemented by Federal Reserve Regulation Z and the Real Estate Settlement Procedures Act, which was originally implemented by Housing and Urban Development Regulation X. Unfortunately, these two regulations required disclosures to be provided to consumer applicants which were inconsistent. The result was that most consumers found the disclosures to be unhelpful, and lenders found them to be complicated to complete and explain. The Dodd Frank Act moved the oversight of the two regulations to the CFPB, and one of the first assignments the CFPB was given by Congress was to integrate the conflicting mortgage loan disclosures. On December 31, 2013, the CFPB finalized a rule which provided new, integrated disclosures along with a detailed explanation of how the forms should be filled out and used. First, the Good Faith Estimate and the early Truth-in-Lending disclosure have been combined into a new form, the Loan Estimate. The new Loan Estimate form is designed to provide disclosures that will be helpful to consumers in understanding the key features, costs, and risks of the mortgage loan for which they are applying, and must be provided to consumers no later than the third business day after they submit a loan application. Second, the HUD-1 and final Truth-in-Lending disclosure have been combined into another new form, the Closing Disclosure, which is designed to provide information about all of the costs associated with the transaction. This form must be provided to consumers at least three business days before consummation of the loan. The final rule applies to most closed-end consumer mortgages. It does not apply to home equity lines of credit, reverse mortgages, or mortgages secured by a mobile home or by a dwelling that is not attached to real property. Financial institutions will be required to use the new disclosure forms on applications received on or after August 1, 2015. The KBA Legal Department will provide training in April 2015 for banks that have questions about how to implement the new disclosure requirements. The training will be held from 9:00 a.m. to 11:00 a.m. in the following locations on the dates listed: April 2 - Wichita, DoubleTree by Hilton; April 7 - Parsons, Recreation Center; April 14 - Salina, Ambassador Hotel; April 15 - Hays, Robbins Center; April 22 - Dodge City, Convention Center; and April 29 - Overland Park, Ritz Charles. Contact the KBA for more information about this educational opportunity. KBA LEADERS LEDGER IS YOUR BANK READY FOR THE NEW INTEGRATED MORTGAGE DISCLOSURE FORMS? 2 015 MARKS THE TENTH YEAR OF KBA’S BANK Leaders of Kansas (BLOK) program, which seems like a logical time to analyze the program’s return on investment (ROI). The graduation of the 2014 BLOK Class at the recently held Harold A. Stones Public Affairs Conference brings the total of BLOK-trained advocates to 106. The positive impact of BLOK is being felt from KBA committee meetings to the KBA board room to the Kansas Statehouse. You are all aware there are many, many leadership development programs in Kansas, but what continues to make the BLOK training experience unique is that it solely focuses on improving the knowledge base and leadership skills of Kansas bankers so they can in turn serve and guide our industry for the rest of their banking careers. As the recently selected 20-member 2015 BLOK class settles into their year-long training experience, I’m pleased to report that the return on KBA’s investment in BLOK is yielding very positive results. Over the past decade, nine BLOK graduates have been elected by their peers or nominated to serve on KBA’s Board of Directors and many, many dozens more have and continue to serve in leadership roles on KBA division boards and committees. BLOK graduates are also making an impact on banking policies being considered in Topeka and Washington, D.C. and as the number of graduates grows, so will the influence of the KBA. As we celebrate the first decade of BLOK, we want to thank each and every bank CEO who has encouraged a member of their staff team to apply and we are grateful for the BLOK program sponsors that continue to financially support this cause. Above all, thank you to this special band of bankers that are now strengthening the KBA and our industry, one BLOK class at a time. BLOK Program ROI Speaks for Itself By DougWareham, EVP-Government Relations By Terri Thomas, SVP, Legal Department Director
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