You normally see multiple disclosure forms when applying for a home loan. It can be a bit confusing. These documents were created by different laws and at different times. In some cases, they have similar information, which can make the information even more complicating to digest. The revised mortgage disclosure forms coming Aug. 2015 will make the information provided to home buyers simpler.
The Loan Estimate Form
Figures from the Truth-in-Lending (TIL) and Good Faith Estimate (GFE) will appear in a new loan estimate document. This disclosure will provide details on the terms of the mortgage, fees charged, estimated loan payments, and any risks involved. This will be useful for comparing different loan options from a single company or from different lenders. Lenders will generate this document within 3 business days of a home loan application.
The New Closing Disclosure
The closing disclosure form details the particular costs related to the home loan. It will combine facts normally included in the Truth-in-Lending disclosure and HUD-1. There are ordinarily a range of charges. To simplify it, they will be grouped into different categories such as service charges, government fees, and pre-paids. This form comes later in the process; it must be provided at least 3 business days before settlement.
Revised Mortgage Disclosure Forms Coming Aug. 2015
These documents will be launched August of 2015. If you apply for a home loan on or after that date, you will receive the new format. This change does not apply to specialized programs such as reverse mortgages. Regardless of which documents apply to you, you should always touch base with your loan officer if you do not understand something. The information on the revised mortgage disclosure forms coming Aug. 2015 in this article is shared only as an overview and does not provide every aspect of the upcoming changes.