Homebuyers, your life just got considerably less stressful related to obtaining a mortgage and closing the transaction on your prospective new property. Long considered a truly complicated aspect of the real estate transaction, closing has typically been fraught with potential pit falls and confusion for buyers. The financial dynamics and government paperwork requirements of the real estate market have made it inherently so.

Recent changes, enacted as of October 3, 2015, have sought to simplify this otherwise complicated and confusing process! The new TILA-RESPA Integrated Disclosure rule introduces two new government forms (down from the prior four), the Loan Estimate Form and the Closing Disclosure Form. Essentially, lenders must now provide buyers clear details regarding their loan terms three days after submitting an application.

The new Loan Estimate Form above details the terms of a potential loan including the amount, interest rate and whether the figures can change after closing.  This form makes it much easier to compare loan terms between lending institutions. It also includes payment projections, as illustrated by this additional snapshot.

The Closing Disclosure Form breaks down estimated closing costs, allowing the borrower to see what should be brought to closing and therefore, hopefully eliminates last minute surprises due to changes in loan terms and closing costs.

Important concerns to check include making sure that figures on both forms match since these numbers drive future payments for a considerable time. If figures have appreciably changed, be sure to find out why. All requirements concerning the property such as inspections, repairs, contingencies should be addressed earlier in the process.

Keep in mind that no changes can be made after three days prior to closing. This may surprise those who have formerly been accustomed to the “last-minute” nature of the closing process. For assistance in selecting a reputable lender who can further explain the new procedures, feel free to contact me today for a consultation. I will be happy to answer any questions you may have, help you sell your current home and/or find a new dream home.

Allyson Hoffman, ABR, ACRE, CDPE, CRS, e-PRO, GRI, SFR, SRES
RE/MAX Villager
Serving Chicago's North Shore, North and Northwest Suburbs
847-310-5300
[email protected]

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Allyson Hoffman is your ultimate real estate resource for Chicago's North Shore, North and Northwest Suburbs and surrounding areas. Visit my website for detailed information regarding today’s real estate markets.