US Consumer Bureau Looking to Test eClosings for Mortgages

April 23, 2014
Home closing

Home buyers sign a variety of documents during a closing. (Tribune file photo / April 23, 2014)

The Consumer Financial Protection Bureau is looking for lenders and technology providers to test whether electronic closings of mortgage loans would simplify a process that is overwhelming and frustrating consumers.

In research conducted during the past year, consumers told the bureau they didn’t have enough time to properly review mortgage documents, that the stack of paperwork, which can vary from one lender to another, can be overwhelming, and that it was hard to decipher and then correct paperwork errors.

Sample closing packages reviewed ranged from 40 pages to more than 100 pages, with the consumer seeing many of those documents for the first time when they meet to sign the loan papers.

“Consumers often feel alone in the process,” the report stated.

Lenders also said they were dissatisfied with current closing processes.

The technology needed for so-called eClosings, viewed as one potential solution to alleviate some of the problem, already is in existence but rarely used. The CFPB hopes to begin the pilot program later this year, to determine whether it makes loan closings more efficient or has the opposite effect of consumers not spending enough time reviewing important documents.

This post originally appeared on ChicagoTribune.com on April 23, 2014.


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