NEW Loan Disclosures for Consumers, Real Estate Investors, Landlords under RESPA
Residential Rental Property Real Estate Loans 2010 RESPA Rules HUD
2010 brings new set of changes around RESPA, which is all about closing costs and settlement procedures. RESPA requires that consumers receive disclosures at various times in the transaction and outlaws kickbacks that increase the cost of settlement services. RESPA is a HUD consumer protection statute designed to help homebuyers be better shoppers in the home buying process, and is enforced by HUD.
HUD is requiring that loan originators provide borrowers with a standard Good Faith Estimate that clearly discloses key loan terms and closing costs and that closing agents provide borrowers with a new HUD-1 settlement statement.
Under the new definition of application if the potential borrower provides the following 6 pieces of information they have filed an application.
1. Borrower’s name
2. Borrower’s SSN
3. Borrower’s gross monthly income
4. Subject property address
5. Estimated subject property value
6. Amount of mortgage loan sought
At this point, the lender is required to provide a Good Faith Estimate within 3 business days and there are much stricter rules around any changes to the estimates so that the lender does not surprise the borrower.
Real Estate Investors, Landlords for more details, download this guide from HUD by CLICKING HERE (6.4MB)
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