Nearly half of borrowers do not shop for a mortgage

The Consumer Financial Protection Bureau released its newest consumer tool “Owning a Home” to help spur homeowner education.

This is a part of the CFPB Know Before you Owe mortgage initiative announced in November 2013.

The campaign’s loan disclosure documents were created in an effort to more efficiently lay out mortgage terms for homebuyers and consist of two new forms: the Loan Estimate and the Closing Disclosure to ensure compliance.

Based on new data in the National Survey of Mortgage Borrowers, a voluntary survey jointly conducted by the CFPB and the Federal Housing Finance Agency, almost half of consumers who take out a mortgage fail to shop prior to filling out an application for a mortgage. Three out of four consumers only apply with one lender or broker, and most consumers only get their information from lenders or brokers, who have a stake in the outcome.

“Most consumers put substantial effort into considering their differing housing needs,” CFPB Director Richard Cordray said in a speech at The Brookings Institute. “But they do not seem to be as careful or as confident in weighing the economic aspects of the mortgage decision, such as what down payment they can afford or what mortgage terms fit their unique financial needs.”

Click here to check out CFPB’s new borrower education tool.

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