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Right Home Mortgage Disclosure Aid | ||||||||||||||
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here for a printable version of this documentThank you for trusting us with the financing of your home. A home represents the biggest investment in the life of most Americans and we want to make sure that you are aware of the major features of the home loan that we have secured for you. You will find below the highlights of your loan, which you should have received prior to or at the time of signing of your official loan documents (Note, Trust Deed and other disclosures). If you disagree with any of the features, or if they are any different than what was explained or promised to you by your loan agent or loan processor, please do not sign the loan documents, or if you have already done so, please contact the supervisor of the office originating your loan or the government authority which licenses the mortgage company you have applied with. As a borrower you have rights under Federal and State law that require lenders to disclose in advance the major terms of the loan you are being offered prior to accepting the loan. While we recommend that you read every page you are asked to sign, we understand that you may not have enough time to read them all. Although not comprehensive, the information hereunder has been extracted from your actual loan documents and you can rely on them to be correct and true. They highlight mainly the terms that may have the biggest and most immediate effect on your ability to repay this new mortgage. This form is intended to protect a mortgage borrower and provide in a glance the highlights of the loan being secured, because most borrowers simply do not read all the details in the numerous pages they are asked to sign. How to use it? You have the right to know, and it is the least you should expect, especially since you are paying for these services.
HIGHLIGHTS OF YOUR LOAN This Disclosure has been made on this ______ day of ____________ (month) in year ___________ by loan agent ____________________________________ on behalf of ____________________________________ (mortgage company), Loan Number #_________________. The highlights below are extracted from your official loan documents and are not estimates. These are terms that we have actually secured for you and are part of your loan. Borrower Name(s): Property Address: AMORTIZATION Your Loan Has a Negative Amortization Feature: We hereby remind you that your loan is a Potential Negative Amortizing Loan, which means that if you make only the minimum payments based on the Initial Interest Rate, your loan balance will gradually increase over time instead of decreasing with each payment. While you will be charged an initial interest rate of ___.___%, this rate is good for only _______ month(s) at which time it will rise by at least _____%. As a result, you will be charged a much higher interest rate even though you may continue making the low initial payments. The difference between your minimum payments based on the low initial interest rate and the higher payments expected of you based on the higher interest you will be charged (not the initial interest rate) will be added on your loan and will raise your balance each month. If the paragraph above is crossed-out, not filled-in/completed, I certify that you do NOT have a Negative Amortizing loan, otherwise, you can count on the information above. Agent Signature: _________________________ Date: ___/___/___ Your Loan Is Fully Amortized: Your First loan is a Fully Amortized loan, which means that when you make your minimum payments each month, part of every payment will reduce your Loan Balance. Agent Signature: _________________________ Date: ___/___/___ PREPAYMENT PENALTY Your loan may carry a prepayment penalty for a period of _______ years ( _______ months). This means that if you chose to refinance your loan, or sell your property, before the end of that time period you may incur a penalty that may amount to thousands of dollars. If blanks above are not completed, then your Loan Does NOT carry a prepayment penalty. Agent Signature: _________________________ Date: ___/___/___ LOAN AMOUNT The financing on your home is composed of a FIRST Loan in the amount of $____________.00, and a SECOND Loan in the amount of $____________.00. INTEREST RATES FIRST LOAN: FIXED / ADJUSTABLE Your First loan is amortized over ______ years and has an INITIAL INTEREST RATE of ___.___%. This INITIAL interest rate is Fixed for _______ year(s) ( ______months). Your FIRST loan DOES / DOES NOT have a Balloon payment feature. If it does, then it is more fully described in your loan documents. Agent Signature: _________________________ Date: ___/___/___ SECOND LOAN is FIXED / ADJUSTABLE Your SECOND loan is amortized over ______ years and has an INITIAL INTEREST RATE of ___.___%. This INITIAL interest rate is Fixed for _______ year(s) ( ______months). Your SECOND loan DOES / DOES NOT have a Balloon payment feature. If it does, then it is more fully described in your loan documents. Agent Signature: _________________________ Date: ___/___/___ MORTGAGE INSURANCE Your loan WILL / WILL NOT require Mortgage Insurance for the benefit of the lender. This mortgage insurance protects the interests of the lender to cover the risks typically associated with reduced down payments. You will have to pay approximately $_______/month for mortgage insurance. Agent Signature: _________________________ Date: ___/___/___
IRS FORMS 4506, 8821, 9501 As a condition for securing your loan you WILL / WILL NOT be required to sign one or more of the IRS forms above. These forms allow a lender to verify with the IRS, at their own discretion, if the income information you have provided as part of your application matches with the income filed on the tax returns you have filed with the IRS. In case of a discovered discrepancy a lender may accelerate your loan, which means that you may have to payoff your loan immediately (typically within 30 days). Your lender may even have to disclose the discovered discrepancy to the IRS. As a result, the IRS may audit the discrepancy and find that you owe back taxes. Agent Signature: _________________________ Date: ___/___/___ GOOD FAITH ESTIMATE As part of your loan application you must have received a Good Faith Estimate within 3 days of completing your loan application. You must also receive a Mortgage Loan Disclosure Statement, which also indicates the closing costs you will be incurring. These estimates should be consistent. By signing below the loan agent acknowledges giving you a good faith estimate. Buyer Acknowledgement of receipt: Buyer: _________________________ Date: ___/___/___ Agent Signature: _________________________ Date: ___/___/___ COPY OF APPRAISAL You are entitled to receive a copy of the Appraisal Report for the property being financed since you have paid for it. This is an important document that you may want for your records and it will also indicate the appraiser’s opinion of value. By signing below I acknowledge that we have provided you with a copy. Buyer Acknowledgement of receipt: Buyer: _________________________ Date: ___/___/___ Agent Signature: _________________________ Date: ___/___/___
By signing below I certify that I have verified your loan documents and personally guarantee that the information above is true, correct and reliable. Furthermore, I also acknowledge retaining a copy of this document. Mortgage Company Name: _________________________ Licensing Authority:_______________________ Agent Name: _____________________________ Signature: _________________________ Date: ___/___/___ * Taxes vary from city to city. This information is not wholly reliable and may vary by as much as 25% from the actual taxes you may have to pay. We recommend you verify with the city and the County Assessor where your property is located to determine the exact amount.
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