The Federal Housing Finance Agency (FHFA) has directed Fannie Mae and Freddie Mac to make specific modifications to the Uniform Residential Loan Application (URLA), including removal of a question CUNA feels could have raised legal and compliance issues.
CUNA and other trade organizations requested FHFA not include a question asking borrowers their language preference, and according to the FHFA, the question will be included on a to-be-developed voluntary consumer information form.
While CUNA supports efforts to ensure borrowers are well-informed during the mortgage process, it believes the language question would raise serious compliance concerns, including creating expectations among consumers that cannot be met, and potentially exposing lenders to liability if the lender is unable to proceed in the borrower’s indicated language of choice.
“We are grateful that the Federal Housing Finance Agency has reconsidered the inclusion of this question after recognizing the numerous compliance and other legal concerns raised by CUNA and other trade organizations,” said Mitria Wilson, CUNA senior director of advocacy and counsel.
According to the FHFA, it will assess the impact the requested changes will have on the release timeline for the updated URLA, and it will provide more information about the new implementation date as soon as it is available.