If you have ever bought a home, you know the stress and confusion of the mortgage process. Since its inception 4 years ago, the Consumer Financial Protection Bureau have been working to make the process of buying a home an easier and more transparent. The new mortgage disclosure rule is in effect as of today- October 3, 2015.
The Know Before You Owe Rule details:
- Four overlapping disclosure forms will be streamlined into 2 forms, the Loan Estimate and the Closing Disclosure.
- More time to review your closing documents. You will receive your Closing Disclosure three business days before you sign the forms and accept the terms of your mortgage.
- New forms will make it easier to understand complicated mortgage terms.
- The Loan Estimate makes it easier to shop around and compare loan offers from multiple lenders. Consider applying for loans from at least three lenders before choosing a mortgage so you can find the best deal for you.
- The three days required between getting your Closing Disclosure and signing on the dotted line allow you to make sure there aren’t major changes from the deal you were offered on your Loan Estimate. It also gives you time to ask your lender all the questions you might have about the terms of your mortgage and consult with a lawyer or housing counselor.
The CFPB have also released “Your Home Loan Toolkit,” a great resource full of worksheets, checklists and information, making the process of purchasing a home easier.