The Consumer Financial Protection Bureau's (CFPB) Integrated Disclosure Rule combines the mortgage disclosures required under the Truth in Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA). It requires lenders to use the new integrated disclosures beginning on Aug. 1, 2015. Successful compliance with this rule depends on use of the latest version of the data standard.
Version 3.3 of MISMO establishes a common dataset that is essentially a prerequisite for lenders to use the CFPB's new integrated disclosures and share the information about the disclosures with their industry partners.
The CFPB's Integrated Disclosures will replace the current Good Faith Estimate (GFE) HUD-1 Settlement Statement and Truth in Lending (TIL) disclosures for most residential mortgage loans starting August 1.
DocMagic said it is the first document preparation software vendor to implement MISMO version 3.3.
"Our early implementation of MISMO version 3.3 is significant because it is yet another step that we are taking to proactively prepare for the CFPB's new Integrated Disclosure rule, as well as industry innovation involving the disclosures," Dominic Iannitti, president and CEO of DocMagic, said.
"Any software provider that is involved in loan closings or data exchange must update their respective systems to implement the new dataset in order to effectively support their partners and lender clients,” added Iannitti. “Those organizations that wait will likely not be ready to meet the CFPB's deadline and as a result will encounter serious compliance issues."
In March 2014, the government sponsored enterprises introduced the Uniform Closing Dataset UCD, which is based on the MISMO v3.3 Reference Model standard used to support the Closing Disclosure under the CFPB's new Integrated Disclosure rule. The Closing Disclosure form combines the final TILA and HUD-1 Settlement Statement.
As a result, closing documents will change significantly come August. Lenders will be responsible for the Closing Disclosure and will need to automatically and seamlessly exchange the data from this disclosure with its settlement agents and other partners.
DocMagic has announced that its entire solution set now adheres to version 3.3 of the Mortgage Industry Standards Maintenance Organization (MISMO) reference model.