Yesterday morning, the CFPB published a notice in the Federal Register to correct a typo regarding tolerances and property taxes. This clarification from the CFPB makes clear that property taxes ARE NOT subject to tolerances.
There was concern among some industry participants that the wording of the rule meant that property taxes fell into the zero tolerance bucket – if property taxes were not disclosed accurately on the Loan Estimate, the lender would be required to pay any property taxes collected at closing that exceeded the amount shown on the Loan Estimate. Though the CFPB gave verbal guidance that there was a typo in the rule, some industry participants remained conservative. This official correction should ease the anxiety some were feeling over this potential tolerance violation.
This correction from the CFPB is a very hopeful sign that they are paying attention to issues raised by the mortgage lending industry and that they will respond to those issues. Learn more about the typo-correction at:
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