Elizabeth Warren, the Obama administration adviser charged with setting up the U.S. Consumer Financial Protection Bureau, said the agency will soon release model mortgage forms that may become the basis of new regulations on home finance.
“We’ve come up with a couple of prototypes,” Warren said today during a meeting with community bankers in Louisville, Kentucky. “In a few weeks, we’ll be ready to share those prototypes.”
Warren, 61, has made simplification of mortgage disclosure forms a centerpiece of her work at the new agency, which is scheduled to officially begin work in July. Warren has said that many of the forms now in use are duplicative.
Warren has touted mortgage disclosure as a way community banks can make inroads against larger rivals like JPMorgan Chase & Co. and Bank of America Corp. If disclosure is simpler and less costly, community banks can compete based on their close ties to customers, she said.
“A community banking model works for American families,” Warren said during the session.
Warren highlighted how the new agency has built outreach to community banks into its initial structure, with a “box” on its organizational chart for a liaison to community banks and other small firms.
‘In Our Face’
“We don’t need a box for the biggest financial institutions,” Warren said. “They’ll be in our face every day.”
In an interview, Warren said that public release of the prototypes would come before advance notice of proposed rulemaking. After the release, she said in her remarks, the bureau will seek public comment, and has budgeted for five phases of testing of the forms with consumers.
The inspector general of the Treasury Department, which currently houses the bureau, has said these notices, an early phase of creating new regulations, could come before the agency is scheduled to assume its full powers on July 21.
The Dodd-Frank financial regulatory overhaul signed by President Barack Obama in July requires the new agency to propose regulations on mortgage disclosure by July 21, 2012.