WASHINGTON (National Association of Realtors) – Lenders will soon be subject to new disclosure requirements for mortgage loans.
Among the new requirements, which will apply to all mortgages secured by a borrower’s home:
- Lenders must give good faith estimates of mortgage loan costs within three business days after the consumer applies for a loan. The lender may not collect any fees before the disclosure is provided, except for a reasonable fee for obtaining a credit report.
- The closing may not take place until expiration of a seven-day waiting period after the consumer receives the early disclosure.
- If the annual percentage rate (APR) increases by more than 0.125 percent, the lender must provide a corrected disclosure to the borrower and wait an additional three business days before closing the loan.
- The consumer may modify or waive both waiting periods for a documented personal financial emergency, but must receive the disclosures no later than the time of the modification or waiver.
The new requirements will apply to loan applications filed on or after July 30, 2009.