Fannie, Freddie Say New Mortgage Forms Will Be Delayed
WASHINGTON – Mortgage financing giants Fannie Mae and Freddie Mac announced nearly three years ago that changes were coming to the standard mortgage application form, which was originally to take effect Feb. 1, 2020. But the wait may be even longer.
The government sponsored enterprises (GSEs) announced last week that they’ll delay mandatory use by lenders of the redesigned Uniform Residential Loan Application (URLA) because the Federal Housing Finance Agency (FHFA) has requested changes to the proposed URLA form.
At issue is a “Language Preference” and “Homeownership Education and Housing Counseling” question, which the GSEs say will now be removed from the redesigned form and included on a separate voluntary form.
The Mortgage Bankers Association had opposed including the language question because of the “customer relations issues the question would cause if lenders could not actually serve borrowers in their preferred language, and due to unresolved operational and legal questions raided by the language preference information,” MBA CEO Bob Broeksmit wrote in a letter to members.
The FHFA also reportedly wants other changes to the URLA form, such as revising a section called “Use and Sharing of Information” to address specific uses of borrower data. Also, a military service question has been proposed to move to a new section under “demographic information.”
A new date for when URLA might take effect hasn’t been announced. But the FHFA and GSEs say the delay will “allow industry participants time to make the necessary changes.”
The changes to the mortgage forms will be the first in the past 20 years.
Source: “Fannie Mae, Freddie Mac Delaying Use of New Uniform Residential Loan Application,” HousingWire (Aug. 8, 2019)
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