New TILA Pre-Disclosure?

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Question:

I have heard that a new truth in lending pre-disclosure will be required next year, but I don't see anything about it in the regulation. Will this be required and if so, where is it stated?

Answer:

I'm not aware of any new ETIL, however effective 10/01/09 the ETIL will be required for all mortgage transactions subject to RESPA that will be secured by the applicant's primary residence.

The heading to 226.19(a) will change from:

(a) Residential mortgage transactions subject to RESPA--(1) Time of disclosures.

to

(a) Mortgage transactions subject to RESPA--(1) Time of disclosures.

These changes also restrict you from collecting any fees, except for a reasonable and bona fide fee for a credit report, before the ETIL is delivered to the applicant. These changes are noted in the Federal Register Wednesday July 30, 2008 Part III Federal Reserve System 12 CFR Part 226 Truth in Lending Final Rule. Here is a link.

First published on BankersOnline.com 3/09/09