On October 3rd, new regulations go into effect. They are meant to simplify the home-buying process.
Joe Bigelman, Branch Manager at John Adams Mortgage explains the changes.
He says there are four important things to know:
- The Loan Estimate replaces the Good Faith Estimate and the truth in lending disclosure forms
- The Closing Disclosure replaces the Settlement Statement
- There is now a 3-day waiting period from the time the closing disclosure is received to the day of loan closing
- The rule applies to mortgage applications take on or after October 3, 2015
There are two new forms, the Loan Estimate and the Closing Disclosure. The Loan Estimate is provided within three business days after application. It combines the Truth in Lending statement and the Good Faith Estimate. The Loan Estimate provides a summary of the key loan terms and estimates of the loan closing costs. It should help buyers comparison shop.
The Closing Disclosure is received three business days before the loan closing. It replaces the final Truth in Lending Statement and Settlement Statement. It provides a detailed account of the transaction.
