And the Timer Starts NOW!
Designed to protect the homebuyer from unwise decisions, the Consumer Finance Protection Bureau (CFPB) will require lenders to document a borrowers’ ability to repay a loan and follow some other common sense rules. These new mortgage rules will go into effect in January 2014.
Tips from the CFPB – New Mortgage Rules
Many lenders are reputable and desire to be your lifelong home financing partner – others not so much. Feel safe about who you have chosen to be your lender by following these new homebuyer tips from the CFPB:
- Make Your Own Decisions – Only you can decide how much you are comfortable paying for a mortgage. The new mortgage rules will make the market safer and easier to understand. For example, lenders now have to make a good faith effort to determine if you have the ability to repay your loan and you don’t have high fees and certain risky features like negative amortization or interest-only periods. In the end, only you can decide how much you are comfortable paying for a mortgage.
- Use Your Market Information. You will get a copy of any appraisal or valuation at least three business days before you go to closing. Appraisals can provide you an estimate of what a home is worth. You may also pay to obtain your own independent appraisal. You should work carefully to understand how the appraiser arrived at the estimated value.
- Get Reliable Help – Any company that is paid to help you find or get a mortgage must train its agents, brokers and loan originators and make sure they have been through a background check. With limited exceptions, the people you hire to help you find a mortgage should be licensed or registered at the state or federal level. Ask your loan originator about their credentials.
- Watch Those Fees – New CFPB mortgage rules limit the fees a lender can charge and still make what is called a Qualified Mortgage. In general, qualified mortgages do not have particularly risky features and the points and fees are less than 3% of the loan amount, though fees can be higher for loans of less than $100,000. These rules do not require lenders to cap fees. You still have to decide for yourself whether it’s a good idea to pay higher fees to get a loan. And be sure to review your closing statement carefully to make sure there are no fees that you did not agree to pay.
My very first mission as a REALTOR Associate and licensed Real Estate Agent was to interview as many mortgage lenders as I could. I work with only the best in order to provide my buyers with the highest level of integrity and trustworthiness.
Visit my website JayBensonHomeSales.com to register and receive free listing alerts. I provide FREE Buyer Representation Services to all my buyers!