Hud’s stated principles that guide these changes:
“1. Borrowers should receive loan terms and settlement cost information early enough in the process to allow
them to shop for the mortgage product and settlement services that best meet their needs;
2. Costs should be disclosed and should be as firm as possible to avoid surprise charges at settlement;
3. Many of the current problems arise from the complexity of the mortgage loan settlement process. The
process can be improved with simplification of disclosures and better borrower information;
4. Increased shopping by borrowers will lead to greater pricing competition, so that market forces will lower
prices and lessen the need for regulatory enforcement
5. The key final terms of the loan a borrower receives should be disclosed to the borrower in an
understandable way at closing; and
6. HUD will continue to vigorously enforce RESPA to protect borrowers and ensure that honest settlement
service providers can compete for business on a level playing field. ”

and hope their new framework will
“(1) Improve and standardize the GFE form to make it easier to use for shopping among settlement service
providers;
(2) Ensure that page one of the GFE provides a clear summary of loan terms and total settlement charges so
that borrowers will be able to use the GFE to comparison shop among loan originators for a mortgage loan;
(3) Provide more accurate estimates of costs of settlement services shown on the GFE
(4) Improve the disclosure of yield spread premiums to help borrowers understand how they can affect their
settlement charges;
(5) Facilitate comparison of the GFE and the Hud-1/Hud-1A Settlement Statements (Hud-1 settlement
statement or Hud-1);
(6) Ensure that at settlement, borrowers are aware of final loan terms and settlement costs, by reading and
providing a copy of a “closing script” to borrowers;
(7) Clarify Hud-1 instructions;
(8) Clarify HUD’s current regulations concerning discounts; and
(9) Expressly state when RESPA permits certain pricing mechanisms that benefit consumers, including
average cost pricing and discounts, including volume-based discounts. “