Learn More About the Closing Disclosure

What is the New Closing Disclosure?

The Closing Disclosure is one of the new TRID (TILA-RESPA Integrated) disclosures that will take effect this fall with the implementation of the CFPB’s Know Before You Owe rule. The Closing Disclosure is provided to borrowers within three business days of settlement. A similar form is provided to the seller of the home, less the details of the borrower’s mortgage loan.

The Closing Disclosure will combine two forms that are in use now – the late Truth-in-Lending form and the HUD-1. Confusion will be reduced by combining and simplifying the required disclosure information into one form.

What is Purpose of Closing Disclosure?

The Closing Disclosure has four basic purposes:

  • To describe the costs you’ll pay at closing over the life of your loan
  • To compare these costs and your pre-paid expenses to those listed in your written Loan Estimate
  • To highlight certain loan terms (such as how a late payment is handled)
  • To provide contact information for the primary professionals involved in your real estate transaction

Here is a sample Closing Disclosure as provided by the Consumer Finance Protection Bureau: Sample Closing Disclosure

Revised Closing Disclosures

As stated, borrowers will receive the Closing Disclosure within three business days of settlement. If certain loan changes occur, you will receive a revised Closing Disclosure. Receipt of revised Closing Disclosure must occur three business days prior to settlement. More specifically, a change in loan program, a change in APR beyond specific tolerance levels, or an addition of a pre-payment penalty will require re-disclosure and potentially delay a closing.

New Closing Disclosure Effective Date

The CFPB recently proposed that the implementation of the new disclosures and regulations be delayed for two months. Instead of August 1, 2015, the CFPB has proposed that the effective date for TRID be moved to October 3, 2015 – see the CFPB news release here. While that date may seem far away, Realtors, lenders and Settlement Service providers must adjust their systems and processes to adhere with new rules.

Please check back here often for more information on TRID disclosures, rules, pending changes and implementation dates. As always, our goal is to provide our borrowers and business partners with exceptional lending services – preparing our partners and borrowers for TRID will help ensure a smooth transition for all involved.

Please do not hesitate to ask a question – email info@inlanta.com for more information or find a loan officer near you using our branch locator.

About Inlanta Mortgage

Headquartered in Brookfield, Wisconsin, Inlanta Mortgage is a growing mortgage banking firm committed to quality mortgage lending, ethical operations and strong customer service.

Inlanta Mortgage offers Fannie Mae/Freddie Mac agency products, as well as a full suite of jumbo and portfolio programs. The company is an agency approved lender for Freddie Mac and Fannie Mae, FHA/VA, FHA 203K and USDA. Inlanta Mortgage also offers numerous state bond agency programs. Review Inlanta’s mortgage loan programs.

Inlanta Mortgage was recently named a Top Workplace for a third time in 2015. Inlanta has also received the Platinum Million Dollar USDA Lender Award and has been recognized as a Top Mortgage Employer by National Mortgage Professional and a Top 100 Mortgage Banking Company and 100 Best Mortgage Companies to Work For by Mortgage Executive Magazine.

Inlanta Mortgage, Inc. NMLS #1016

Learn More About the Loan Estimate

Loan-Estimate

What is the New Loan Estimate?

The Loan Estimate is one of the new TRID (TILA-RESPA Integrated) disclosures that will take effect this fall with the implementation of the CFPB’s Know Before You Owe rule. The goal of the Loan Estimate is to help borrowers better understand the costs associated with buying a home. The Loan Estimate is provided to borrowers within three business days of applying for a mortgage loan and must arrive at least one day before you receive your Closing Disclosure.

The Loan Estimate will combine two forms that are in use now – the early Truth-in-Lending form and the Good Faith Estimate. Confusion will be reduced by combining and simplifying the required disclosure information into one form.

What Information is on Loan Estimate?

The Loan Estimate will include the following basic types of information:

  • Loan terms, including amount and interest rate
  • Projected monthly payments
  • Estimated Costs at closing, including pre-paid expenses
  • Total interest you will pay if you keep the loan for the full term

Here is a sample Loan Estimate as provided by the Consumer Finance Protection Bureau: Sample Loan Estimate

Revised Loan Estimates

As stated, borrowers will receive the Loan Estimate within three business days of applying for a mortgage loan. During the course of the loan process, if certain costs on your Loan Estimate change significantly, you will receive a revised Loan Estimate. Items that could trigger a revised loan estimate include: costs changing more than allowable limits, your interest rate is locked in, and your loan loan amount or loan program changes. We encourage you to save the Loan Estimate and compare it against the Closing Disclosure document that you will receive three business days before your settlement (closing).

New Loan Estimate Effective Date

The CFPB recently proposed that the implementation of the new disclosures and regulations be delayed for two months. Instead of August 1, 2015, the CFPB has proposed that the effective date for TRID be moved to October 3, 2015 – see the CFPB news release here. While that date may seem far away, Realtors, lenders and Settlement Service providers must adjust their systems and processes to adhere with new rules.

Please check back here often for more information on TRID disclosures, rules, pending changes and implementation dates. As always, our goal is to provide our borrowers and business partners with exceptional lending services – preparing our partners and borrowers for TRID will help ensure a smooth transition for all involved.

Please do not hesitate to ask a question – email info@inlanta.com for more information or find a loan officer near you using our branch locator.

About Inlanta Mortgage

Headquartered in Brookfield, Wisconsin, Inlanta Mortgage is a growing mortgage banking firm committed to quality mortgage lending, ethical operations and strong customer service.

Inlanta Mortgage offers Fannie Mae/Freddie Mac agency products, as well as a full suite of jumbo and portfolio programs. The company is an agency approved lender for Freddie Mac and Fannie Mae, FHA/VA, FHA 203K and USDA. Inlanta Mortgage also offers numerous state bond agency programs. Review Inlanta’s mortgage loan programs.

Inlanta Mortgage was recently named a Top Workplace for a third time in 2015. Inlanta has also received the Platinum Million Dollar USDA Lender Award and has been recognized as a Top Mortgage Employer by National Mortgage Professional and a Top 100 Mortgage Banking Company and 100 Best Mortgage Companies to Work For by Mortgage Executive Magazine.

Inlanta Mortgage, Inc. NMLS #1016

What is TRID?

TRID

What is TRID?

TRID stands for TILA-RESPA Integrated Disclosure. TILA stands for Truth in Lending Act, and RESPA stands for the Real Estate Settlement Procedures Act. That still doesn’t answer your question, does it? So, what is TRID?

TRID refers to the new integrated disclosures for real estate transactions implemented by the Consumer Finance Protection Bureau (CFPB).  On August 1st of 2015, the CFPB is consolidating existing mortgage disclosures from four forms, to two forms. The CFPB is integrating the Good Faith Estimate (GFE) and Early Truth in Lending (TIL) into one document called the Loan Estimate (LE). The HUD-1 and Final TIL will be integrated into one document called the Closing Disclosure (CD). UPDATE as of 6/25/2015: The CFPB will be issuing a proposed amendment to delay the effective date of the TRID until October 3, 2015. Review the CFPB news release here.

TRID Effective Date

The newly created TRID disclosures will apply to most closed-end consumer loans for which an application is received on or after August 1st. UPDATE as of 6/25/2015: The CFPB will be issuing a proposed amendment to delay the effective date of the TRID until October 3, 2015. Review the CFPB news release here.

What TRID Means for Consumers

TRID will reduce paper work and consumer confusion by using clear language meant to help consumers better understand the complicated mortgage loan process. The new forms will highlight information that consumers have indicated are most important including: interest rate, monthly payment and total closing costs. TRID will also provide more information on the cost of taxes and insurance and how interest rate and payments may change in the future. The TRID will also make cost estimates consumers received for services required to close the loan more reliable and require mortgage lenders to provide the CD three business days before closing on mortgage loans. Visit the CFPB website to read What the new simplified mortgage disclosures mean for consumers

How TRID Will Affect Realtors

One aspect of the new integrated disclosures rules that will affect Realtors is that there are new time-sensitive delivery requirements for Closing Disclosures. The consumer must receive the Closing Disclosure a minimum of three business days before closing (date note is signed). In addition, there are certain changes to the loan file that can require a re-disclosure and a new 3-day minimum waiting period – changes to APR, loan product or the addition of pre-payment penalties are examples. Watch this video posted on the National Association of Realtors website: TRID Changes Coming.

Additional TRID Resources

CFPB Webinars

Additional Resources

We are here to help if you have further questions. Please email info@inlanta.com if you have specific questions about TRID and its implementation.

Our Mission Statement

Our mission is to be the home financing partner that you trust to serve your family, friends and community. Through our family of dedicated mortgage professionals, our commitment is to deliver an exceptional experience. Our unwavering dedication to integrity, honesty and ethics is the foundation of all of our relationships.

About Inlanta Mortgage

Headquartered in Brookfield, Wisconsin, Inlanta Mortgage is a growing mortgage banking firm committed to quality mortgage lending, ethical operations and strong customer service.

Inlanta Mortgage offers Fannie Mae/Freddie Mac agency products, as well as a full suite of jumbo and portfolio programs. The company is an agency approved lender for Freddie Mac and Fannie Mae, FHA/VA, FHA 203K and USDA. Inlanta Mortgage also offers numerous state bond agency programs. Review Inlanta’s mortgage loan programs.

Inlanta Mortgage was recently named a Top Mortgage Lender in 2013 as well as 2012 by Scotsman Guide. Inlanta was named a Top Workplace in 2014 as well as in 2012. Inlanta has also been named one of the “Top 100 Mortgage Companies in America” in 2011, 2012 and 2013 and one of the 50 Best Companies to Work For by Mortgage Executive Magazine.

Inlanta Mortgage, Inc. NMLS #1016

 

What Are Qualified Mortgages?

Qualified-Mortgages

What Are Qualified Mortgages?

In essence, qualified mortgages adhere to a set of guidelines designed to protect consumers from entering into a mortgage they can not repay. Most lenders, including Inlanta Mortgage, already comply with the Qualified Mortgage regulations and document a borrowers’ “Ability to Repay” a mortgage loan.

Ability to Repay

The “Ability to Repay” (ATR) guidelines refer to information that lenders must collect and verify to ensure that the borrowers can repay a mortgage loan. For those familiar with the mortgage process, this information is already required by Inlanta Mortgage and other reputable lenders. For those unfamiliar with required mortgage loan documentation, these are the eight categories of information that must be documented and verified under the new ATR rule:

  1. Current or reasonably expected income or assets
  2. Current employment status
  3. The monthly payment on the covered transaction
  4. The monthly payment on any simultaneous loan
  5. The monthly payment for mortgage-related obligations
  6. Current debt obligations, alimony, and child support
  7. The monthly debt-to-income ratio or residual income
  8. Credit history

What Else Should I Know About Qualified Mortgages?

It’s important to note that the Qualified Mortgage regulations came about as a result of the housing market meltdown from which we are currently recovering. Before the meltdown, too many mortgages were made by unsavory lenders to consumers without regard to the borrowers’ ability to repay the loans. These new regulations were required by Congress, as a response to the financial crisis and nationwide foreclosure epidemic.

Besides the “Ability to Repay” documentation and verification, new rules also state that qualified mortgages have:

  • No interest only feature
  • No balloon payment
  • Amortization not to exceed 30 years
  • No prepayment penalties
  • Maximum debt-to-income ratios
  • No negative amortization
  • Limits on points and fees

What Does QM Mean To Me?

This is a great question and the answer depends upon your lender. As a mortgage banker, Inlanta offers more financing options than other types of lenders. As a mortgage banker Inlanta has the ability to deliver/sell loans to multiple investors with varying guidelines. For example, the maximum debt-to-income (DTI) is set at 43% except in cases where the borrower qualifies with agency automated underwriting approval. Since VA, FHA, Fannie Mae and Freddie Mac are exempt from this specific restriction with automated underwriting approvals – only lenders with access to these agency products can offer mortgage loans that exceed the 43% DTI maximums. Not all lenders have access to VA, FHA, Fannie Mae or Freddie Mac mortgage products.

Learn More About Qualified Mortgages

The Consumer Finance Protection Bureau (CFPB) has posted a wealth of information on the new Qualified Mortgage regulations. Most recently, the CFPB published Fact vs. Fiction, a paper that addresses some of the myths that are being pushed around on the internet. For more heavy reading, you can review the Summary of the Ability-to-Repay Qualified Mortgage Rules and the Concurrent Proposal here.

Contact a licensed mortgage loan officer at Inlanta Mortgage for more information. Use our branch locator to find a professional near you.

Our Mission Statement

Our mission is to be the home financing partner that you trust to serve your family, friends and community. Through our family of dedicated mortgage professionals our commitment is to deliver an exceptional experience. Our unwavering dedication to integrity, honesty and ethics is the foundation of all of our relationships.

About Inlanta Mortgage

Headquartered in Brookfield, Wis., Inlanta Mortgage was established in 1993. Inlanta Mortgage offers Fannie Mae/Freddie Mac agency products, as well as a full suite of jumbo and portfolio programs. The company is an agency approved lender for Fannie Mae, FHA/VA, FHA 203K and USDA. Inlanta Mortgage also offers numerous state bond agency programs.

Inlanta Mortgage is a multi-state mortgage banker based out of Brookfield, Wisconsin. NMLS #1016. Inlanta Mortgage is proud to be named to the Scotsman Guide Top Mortgage Lenders 2012 list and to be among the Top 100 Mortgage Banking Companies in America in 2012.

New Mortgage Rules – CFPB Offers Tips for Homebuyers

CFPB help for homebuyers

New mortgage rules designed to make the loan process easier for homebuyers will go into effect in January. The rules being implemented by 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.

Tips from the CFPB – New Mortgage Rules

While many lenders, like Inlanta Mortgage, are reputable and seek to be your lifelong home financing partner – others are not so upfront. Make sure you are comfortable with your lender and the lending process by following these new homebuyer tips from the CFPB:

  1. 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.
  2. 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.
  3. 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.
  4. 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.

Our Mission

Our mission is to be the home financing partner that you trust to serve your family, friends and community. Through our family of dedicated mortgage professionals our commitment is to deliver an exceptional experience. Our unwavering dedication to integrity, honesty and ethics is the foundation of all our relationships.

About Inlanta Mortgage – Celebrating 20 Years

Celebrating its 20th Anniversary, Inlanta Mortgage is a growing mortgage banking firm committed to quality mortgage lending, ethical operations and strong customer service.

Inlanta Mortgage offers Fannie Mae/Freddie Mac agency products, as well as a full suite of jumbo and portfolio programs. The company is an agency approved lender for Fannie Mae, FHA/VA, FHA 203K and USDA. Inlanta Mortgage also offers numerous state bond agency programs. Review Inlanta’s mortgage loan programs here.

Inlanta Mortgage is a multi-state mortgage banker based out of Brookfield, Wisconsin NMLS #1016. Inlanta Mortgage was named a Top Mortgage Lender in 2012 by Scotsman Guide and has been listed on Mortgage Technology’s Top 25 Tech Savvy Lenders List for the last four years.