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FHFA previously floated the possibility of adding another question to their new Uniform Residential Loan Application (URLA). This one has to do with an applicant’s preferred language, for communication. This question raised quite a few questions of its own.
Industry participants are concerned that such a question might raise some operational and more importantly, legal challenges for lenders. Would it lead to an applicant’s belief they were not treated fairly if a lender did not, or was unable, to communicate important information in their preferred language?
The jury is in! FHFA announced on October 20, 2017, that it will include the Preferred Language Question (PLQ) in its new URLA scheduled for required use in 2020. FHFA PLQ Announcement.
The question will ask an applicant to indicate in which language they prefer to communicate with a lender during their application, and further, during the loan’s servicing. The above announcement will provide the detail on what is included in the PLQ and its disclosure.
It appears in its final version, FHFA made some attempt to satisfy the concerns raised by the industry, in its development of the final question and related information. The question is accompanied by disclosure information intended to protect the lender when communication in the selected language is not available through the lender. The goal is to help both consumer and lender in attempts to avoid any miscommunications.
Hopefully, nothing will get lost in translation.
MBA seems lukewarm on its response to the new question, saying that while they appreciate FHFA’s modest improvements, significant reservations still remain. Sounds to me like as far as MBA is concerned the matter is not yet resolved.
FHFA is moving forward, announcing they will issue an updated, revised, new URLA. The new one will include the new PLQ, later in 2017, for use by lenders in preparation for programming and use in 2020.
As many lenders already began their work for preparation of the new URLA, as previously introduced, some new additional programming will be required. What’s next?
Maybe lenders should look into programming links to each language to bring an applicant to a site whereby they can make their application in their native language and have it translated for entry into the English URLA.
The site can provide instructions and other required disclosures to the applicants in their chosen language. Better yet, have it be voice activated so the applicant may speak to the application in their preferred language, with that being translated for use by the lender.
For instructions and questions an LO or service rep can speak in English and the communication would be translated into the consumer’s preferred language.
May sound a little Buck Rogers, but it’s time to really start thinking outside the box. Find ways to service more consumers, in more ways, with more diversified products and services. Let’s face it; good communication is a solid foundation on which to build.
Lenders need to find ways to help consumers while protecting themselves against unintended consequences. It’s good to expand the box in attempts to help more people. But, in doing so we also must ensure we protect ourselves.
You know what they say about all those good intentions…any questions?
Editor’s note: Buck Rogers was a science fiction character from 1929 that Mike remembers fondly from his youth. Just kidding. We are sure that, in all fairness, Mike is referring to “Buck Rogers in the 25th Century” which was released in 2010.
