Fannie, Freddie Say New Mortgage Forms Will Be Delayed
August 9, 2019
Mortgage financing giants Fannie Mae and Freddie Mac announced nearly three years ago that changes were coming to the standard mortgage application form, which were to originally take effect Feb. 1, 2020. But the wait may be even longer.
The GSEs announced this week that they will delay the mandatory use by lenders of the redesigned Uniform Residential Loan Application. The Federal Housing Finance Agency 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 is requesting 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 the URLA might take effect has not 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.
“Fannie Mae, Freddie Mac Delaying Use of New Uniform Residential Loan Application,” HousingWire (Aug. 8, 2019)
Updated: November 20, 2019