It is taking home buyers longer to get a mortgage, which some in the real-estate industry say is the result of new federal rules meant to make mortgage terms easier to understand, the Wall Street Journal reported today. Mortgages took an average of 49 days to close in November, a three-day increase from October and the longest closing time since February 2013, according to mortgage-processing firm Ellie Mae. Behind the scenes, some lenders describe disarray as various parties in real-estate transactions carry different interpretations of the same rules. The changes, implemented by the Consumer Financial Protection Bureau in October, replace the forms borrowers receive when they make an application and before they close on a mortgage. The new forms are meant to make mortgage terms and fees clear. The rules also require lenders to give borrowers final terms of a loan at least three business days before closing to ensure they have time to understand the agreement. Lenders say that both changes resulted in large technical and training challenges. Advocates for the changes say they are a common-sense response to the housing crisis, during which it became apparent that many borrowers didn’t understand the ramifications of terms such as teaser rates or growing principal balances. They note that lenders had more than a year to prepare for the changes.
