real estate finance - full book (500 pgs)

The mortgage companies with their loan brokerage

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Unformatted text preview: a specific purpose, such as an addition to your home. In dealing which type of loan best suits your needs, consider the costs under the two alternatives. Look at the APR and other charges. You cannot, however, simply compare the APR for a traditional mortgage loan with the APR for a home equity line because the APRs are figured differently. The APR for a traditional mortgage takes into account the interest rate charged plus points and other finance charges. The APR for a home equity line is based on the periodic interest rate alone. It does not include points or other charges. 15-12 Licensing School for Appraisal, CPA, Contractors, Insurance, Real Estate, Notary, Nurse, Food Handlers, Tax and Securities 15: REFINANCING OR NOT AND CHOOSING A LENDER Disclosures from Lenders – The Truth in Lending Act requires lenders to disclose the important terms and costs of their home equity plans including the APR, miscellaneous charges, the payment terms and information about any variable–rate feature. If you have not received this information from the lender, any application fees you have been charged must be refunded. You usually get these disclosures when you receive an application form, and you should get additional disclosures before the plan is opened. If any term has changed before the plan is opened (other than a variable–rate feature), the lender must return all fees if you decide not to enter into the plan because of the changed term. When you open a home equity line, the transaction puts your home at risk. The Truth in Lending Act gives you three days from the day the account was opened to cancel the credit line. This right allows you to change your mind for any reason. You simply inform the creditor in writing within the three–day period. The creditor must then cancel the security interest in your home and return all fees – including any application and appraisal fees paid in opening the account. SHOPPING FOR THE LOAN HOW TO SELECT A LENDER? One of the important decisions that a borrower will make in the loan process is to select the right loan broker to ha...
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This note was uploaded on 12/30/2010 for the course SOC 101 taught by Professor Zhung during the Spring '10 term at Punjab Engineering College.

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