Key Documents
and Links
HUD's
Main RESPA Page
The
Final RESPA Rule (Published in the Federal Register)
The
New HUD-1 Form
The
New GFE Form
HUD's
"New RESPA Rule FAQs"
Additional Resources
FreeHUD-1.com,
hosted by TSS
An electronic copy of HUD's
Settlement Cost Booklet can be sent to the borrower electronically
in lieu of the printed booklet.
News and Information About RESPA Reform:
HUD'
s Proposed Rule on RESPA Reform
HUD
RELEASES ADDITIONAL COMPLIANCE GUIDANCE ON NEW RESPA RULE
Additional FAQ’s for completing GFE and HUD-1
RESPA Related Headlines
RESPA
Final Rule Posted
HUD's
Standard Good faith Estimate form
Settlement
Statement( HUD- 1) Form
HUD
1 Instructions
Full
Summary of RESPA Final Rule [PDF]
HUD
Issues New Mortgage Rules to Help Consumers Shop for Lower Cost
Home Loans
New 'Good Faith Estimate' will help borrowers save nearly $700
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Fact
Sheet on HUD's Final RESPA Rule
- For the first time ever, HUD will require
mortgage lenders and brokers to provide borrowers with an easy-to-read
standard Good Faith Estimate (GFE) that will clearly answer the
key questions they have when applying for a mortgage including:
What's the term of the loan?
Is the interest rate fixed or can it change?
Is there a pre-payment penalty should the borrower choose to refinance
at a later date?
Is there a balloon payment?
What are total closing costs?
- HUD estimates that by improving upfront
disclosures on the GFE, and limiting the amount estimated charges
can change, consumers will save nearly $700 in total closing costs.
- Based on substantial public comment, HUD
withdrew a proposed requirement that closing agents read and provide
a 'closing script.' Instead, to borrowers in favor of a new page
on the HUD-1 Settlement Statement that allows consumers to easily
compare their final closing costs and loan terms with those listed
on the GFE.
- HUD's new Good Faith Estimate has been
reduced from four to three pages, including an instructional page
to help borrowers better understand their loan offer. In addition,
the GFE will consolidate closing costs into major categories to
prevent junk fees and display total estimated settlement charges
prominently on the first page so the consumer can easily compare
loan offers. HUD will specify the closing costs that can and cannot
change at settlement. If a fee changes, HUD will limit the amount
it can change.
- To help borrowers compare their Good Faith
Estimate with their HUD-1 Settlement Statement, each designated
line on the final HUD-1 will now include a reference to the relevant
line from the GFE. Borrowers will now be able to easily compare
their estimated and actual costs in the same manner many commenters
suggested.
- HUD will require lender payments to mortgage
brokers (often called Yield Spread Premiums) to be disclosed in
a more meaningful way. These payments are directly dependent on
the interest rates that consumers agree to. To ensure that HUD's
new requirement will not create a consumer bias against brokers,
the Department did rigorous consumer testing and found the new
Good Faith Estimate helped consumers to select the lowest cost
loan nine-out-of-10 times, regardless of whether the loan was
originated by a lender or a broker.
- Loan originators will be required to
provide borrowers their Good Faith Estimate three days after the
loan originator's receipt of all necessary information. To facilitate
shopping, loan originators could not require verification of GFE
information (tax returns etc.) until after the applicant makes
the decision to proceed.
- HUD will allow lenders and settlement
service providers to correct potential violations of RESPA's new
disclosure and tolerance requirements. Lenders and settlement
service providers will now have 30 days from the date of closing
to correct errors or violations and repay consumers any overcharges.
- The new, standardized GFE and revised
HUD-1 will not be required until January 1, 2010.
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