When applying for a mortgage, you receive many forms to review. It may be a bit confusing. These forms were established by different legislation over time. In many cases, they offer overlapping figures, making the documentation even more difficult to digest. The new lender disclosure forms beginning Oct. 2015 will simplify the information given to home buyers.
The Loan Estimate Form
Figures from the Truth-in-Lending (TIL) and Good Faith Estimate (GFE) will appear in a new loan estimate disclosure. This document will provide details on the terms of their loan, costs involved, projected monthly payments, and other applicable information. This can be helpful when evaluating different mortgage programs either from a single mortgage company or from different ones. When you apply for a mortgage, the mortgage company must send you this document within 3 business days.
The Closing Disclosure Document
The closing disclosure form provides the specific costs charged in connection to the mortgage. It combines facts included in the HUD-1 and Truth-in-Lending disclosure. To help make sense of the different charges, fees are arranged into a few categories such as service charges, taxes, and escrow payments. This document is available near the end of the process,… at least 3 business days prior to closing.
New Lender Disclosure Forms Beginning Oct. 2015
The revised forms will be launched October of 2015 (extended from the original August start date). If you start a mortgage application on or after that date, you will notice them. This change does not apply to reverse mortgages and home equity lines. Regardless of which disclosures you receive, you should always call your mortgage advisor if you are confused about anything regarding your mortgage. The information on the new lender disclosure forms beginning Oct. 2015 detailed above is shared only as an introduction and does not cover every aspect of the upcoming revisions.