What is included in the home loan Toolkit?
Your home loan toolkit: A step-by-step guide is a concise booklet that guides home buyers through the home loan process. Contains interactive worksheets, checklists, research tips, terms, and conversation starters to help home buyers shop with confidence for the home loan that suits their needs.
What are the 4 components of an ARM loan?
An ARM has four components: (1) an index, (2) a margin, (3) an interest rate cap structure, and (4) an initial interest rate period. When the initial interest rate period has expired, the new interest rate is calculated by adding a margin to the index.
What is the special information booklet mortgage?
The special information booklet is required pursuant to Section 5 of RESPA (12 U.S.C. 2604) and is published by the Bureau to help consumers applying for federally related mortgage loans understand real estate transactions.
What is a settlement cost booklet?
Settlement Cost Booklet is an informational booklet that helps the borrowers become familiar with the home-buying and mortgage process so that they make informed decisions and avoid common pitfalls. The booklet helps borrowers get a basic understanding of the mortgage process, disclosures, and fees.
Is the home loan tool kit is required by Trid?
Lenders are required to give you the toolkit within three business days after you apply for a loan to buy a home. The toolkit is designed to be used with the Loan Estimate and Closing Disclosure, the two new disclosures that replace four overlapping mortgage forms for applications received on or after October 3, 2015.
What is a PMI?
Private mortgage insurance, also called PMI, is a type of mortgage insurance you might be required to pay for if you have a conventional loan. Like other kinds of mortgage insurance, PMI protects the lender—not you—if you stop making payments on your loan.
What are the 4 types of ARM caps?
There are four types of caps that affect adjustable-rate mortgages.
- Initial adjustment caps. This is the most your interest rate can increase the first time it adjusts.
- Subsequent adjustment caps.
- Lifetime caps.
- Payment caps.
Who gives the special information booklet to the borrower?
The lender
(1) The lender shall provide the special information booklet by delivering it or placing it in the mail to the applicant not later than three business days (as that term is defined in § 1024.2) after the application is received or prepared.
What is a charm booklet?
Consumer Handbook On Adjustable-Rate Mortgages (CHARM Booklet) is an informational booklet containing general information on Adjustable Rate Mortgages (ARM’s) that is provided by the lender to the loan applicant at the time of application for certain adjustable mortgage loans.
What is a HUD sheet?
The HUD-1 Settlement Statement is a document that lists all charges and credits to the buyer and to the seller in a real estate settlement, or all the charges in a mortgage refinance. If you applied for a mortgage on or before October 3, 2015, or if you are applying for a reverse mortgage, you receive a HUD-1.
What is the 3 7 3 rule in mortgage terms?
Timing Requirements – The “3/7/3 Rule” The initial Truth in Lending Statement must be delivered to the consumer within 3 business days of the receipt of the loan application by the lender. The TILA statement is presumed to be delivered to the consumer 3 business days after it is mailed.
What is the purpose of Reg B?
Regulation B prohibits creditors from requesting and collecting specific personal information about an applicant that has no bearing on the applicant’s ability or willingness to repay the credit requested and could be used to discriminate against the applicant.
What is a Trid?
TRID is a series of guidelines enforced by the Consumer Financial Protection Bureau (CFPB) that attempt to close some of the loopholes that unscrupulous lenders have used in the past to trick consumers. TRID rules dictate what mortgage information lenders need to provide to borrowers and when they must provide it.
What is LTV in a loan?
The loan-to-value (LTV) ratio is a measure comparing the amount of your mortgage with the appraised value of the property. The higher your down payment, the lower your LTV ratio. Mortgage lenders may use the LTV in deciding whether to lend to you and to determine if they will require private mortgage insurance.
What is MPI insurance?
Mortgage protection insurance (MPI) is a type of life insurance designed to pay off your mortgage if you were to pass away — and some policies also cover mortgage payments (usually for a limited period of time) if you become disabled.
What is a 10 6 ARM loan?
10/6 ARM: A 10/6 ARM loan has a fixed rate of interest for the first 10 years of the loan. After that, the interest rate will adjust once every 6 months over the remaining 20 years.
What is a 7 1 ARM loan?
A 7/1 adjustable-rate mortgage (ARM) is a hybrid home loan product. Homeowners make fixed monthly mortgage payments at a set interest rate for the first seven years. After that time passes, a 7/1 ARM’s rate can increase or decrease on an annual basis for the rest of the loan’s life.
What is another name for special information booklet?
The CFPB has issued an updated version of the home buying information booklet (also known as the special information or settlement cost booklet) required under RESPA and TILA.