It is everyone's dream to own a house. However, applying for a mortgage loan can be a difficult task to handle. People go through a hard time coming around the whole process of a mortgage application. Thus, some give up completely just by the thought of what they are bound to go through to get their applications processed. For that matter, the Consumer Protection Bureau introduced new simplified Mortgage forms, which are simplified, easy to read, and accurate. People can now apply for their mortgage without a hustle.
The Traditional Mortgage Forms
Initially, the process of getting a mortgage loan in Philadelphia used to be tedious and time wasting. Lenders would inform closing costs to buyers through the Good Faith Estimate and Truth In Lending Forms. These forms contained the information the lender was offering for your mortgage. It contained the annual percentage rates, finance charge, possible penalties and any other fees associated with the loan. It also outlined the financed amount and the total payments you make for your mortgage.
Details of your principal and interest were also included. The mortgage insurance and other payment requirements including taxes were outlined in these forms. After that, the buyer's would now receive the final set of documents, and then the process is completed. This took quite some time and borrowers would go through a longer process.
The Introduction of Simplified Mortgage Forms
It is for that same reason the Consumer Protection Bureau came up with a friendly version of the forms. It was revised into two major consumer-friendly forms, which all the people could easily go through. The first form is a three-page form that is issued within the first three days of applying for a mortgage loan. It contains details of the loan, along with the interest rates, monthly payments, and a estimated closing costs. All the information in this form is simplified and understood by people of all calibers and education levels.
After your loan application is approved, you are prompted to fill a five-page form with all the final details of your mortgage loan. The information contained include interest rates, exact monthly payments, taxes amount needed for the borrower to close the loan. This amount should be availed three days before your loan is scheduled to close.
Good News for the People of Philadelphia
The new mortgage form comes as good news to the people of Philadelphia. Initially, people used to fill forms and agree to terms and conditions that later termed to be undesirable to customer needs. Loan applicants would be provided with huge forms that they would just peruse through without getting clear information of what they require. Consequently, consumers would be forced to pay hidden fees and monies they had not anticipated for. The simplified form now makes it possible to get crystal clear information.
The new system allows you to compare loan options and gives you enough time to prepare for the closing. After deciding on which service provider you are getting a mortgage loan from, you receive the new closing disclosure, which has details of the loan and your closing cost in five pages. At this stage, it is almost right to say that you already own a house. What next after your loan gets approved? It is necessary to get a professional inspector to inspect your house to access any problems and advise further on the condition of the facility.
Additionally, you will need to get a homeowners insurance policy. Consequently, it is necessary to get all your relevant documents together to avoid any delays in getting your new home. It is advised you provide accurate and clear information to facilitate proper documentation of your details. You need to pay for the down payment for you to acquire ownership of the house.
It is correct to say this is a steady step towards helping residents of Philadelphia to getting homes. Before, one could just get fed up by the glance of the requirements of getting a mortgage loan. Currently, the face of applying for a mortgage loan has changed and the requirements revised downwards. If you are contemplating on getting a loan for a house, there is some relieve. All you need is to visit a loan institution of your choice, fill the new mortgage form, sign a few documents, pay for the first installment and get yourself a house!