On January first, 2010 there will be new RESPA changes that go into effect. There will be a new GFE and HUD. These disclosures are being implemented for consumer awareness and protection.
Starting 2010 borrowers will see the complete cost of loans, all fees, including YSP. YSP will be disclosed as a dollar amount and not a range of yield. It will be listed in 2 places, one as the origination charge and then secondly as a credit back to the borrower. If you need to re-disclose, the waiting period under HERA will apply. These changes will apply to HELOCs and Reverse mortgages also.
Borrowers should take their time reviewing these, and check all fees and not the APR when comparing to other brokers or lenders. A bank's APR may seem less, but because brokers will be giving a credit as part of the new disclosure, they may actually have a better option for the borrowers. I know this is all new and may be confusing, but if you compare the bottom line numbers, you will see who is giving you the best option.
The Temporary Loan Limits have been extended to the end of 2010, under H.R. 2296.
FHA will also be making some changes. The first will be that FHA will do away with their Approved Condo list. It will be up to the lender to do its own review of the condo. The FHA Spot On Approval will most likely be gone in the first quarter of 2010. It also looks like the requirements for owner occupancy will be increased.
Alex Echeandia 301-881-8900
Monday, November 30, 2009
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