New Mortgage Disclosure Rules, New Language for Buyers in Alexandria and Northern Virginia
Real estate agents and buyers alike in Alexandria and Northern Virginia are learning about new mortgage disclosure rules and new language that went into effect this month (October).
Revised by the Consumer Financial Protection Bureau (CFPB), the new disclosure rules are squarely aimed at protecting the consumer and making sure they are getting the best mortgage terms possible. Perhaps the biggest change is the old HUD-1, now called the Closing Disclosure.
Previously the HUD-1, a standard form used to itemize services and fees charged to the borrower by the lender, was often delivered at settlement with buyers seeing it then for the first time.
Under the new rules, the HUD-1/ Closing Disclosure, must be given to buyers three days in advance of settlement. This gives buyers the opportunity to review exactly what charges they are incurring. Another change is that agents will no longer automatically receive a copy of the Closing Disclosure unless the buyer gives their permission.
Other changes in terminology? A “lender” is now a creditor and a “good faith estimate” is now just a loan estimate.
Stay tuned over the next few weeks as we continue to highlight changes in the real estate and mortgage industry.
Virginia and Michael