HUD changed FAQ site; More on RESPA Requirements

What is happening today in mortgage lending: Did you see this from HUD yesterday? (I have updated the QandA on my site)

FHA will begin using a new Frequently Asked Questions (FAQ) service as of December 8, 2008. This change required some modifications to the look and feel of the FAQ site ( http://faq.fha.gov ) as well as the need to use a new primary email address for email inquiries to FHA.

The new primary email address for FHA is now: info@fhaoutreach.com

In addition, clients may also utilize the "Contact FHA" tab on the FAQ site to submit questions directly to FHA.

FHA believes these changes will improve our ability to communicate with our clients and look forward to responding to your needs.

AND

Agencies Participating in HUD’s Housing Counseling Program:

New RESPA Requirements

HUD recently announced new regulatory requirements regarding the Real Estate Settlement Procedures Act (RESPA). 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 key consumer questions, including loan terms and closing costs. A revised HUD-1 Settlement Statement will allow borrowers to easily compare their final closing costs and loan terms with those listed on the GFE. The changes are estimated to save consumers an average of $700.00 in closing costs and encourage consumers to choose lowest-cost loans.

The new GFE will be three pages long, including an instructional page for consumers, and will correspond with specific sections of the new HUD-1 form for easy comparison. The first page of the GFE will prominently display total estimated settlement charges so the consumer can easily compare loan offers. Among other benefits of these changes, Yield Spread Premiums will be disclosed more effectively and junk costs will be more difficult to hide.

Loan originators will be required to provide borrowers their GFE three days after the loan originator's receipt of all necessary information. HUD will specify the costs that can change from this original GFE, and by how much.

HUD will require the new standardized GFE and HUD-1 beginning January 1, 2010; however, lenders can implement the new forms sooner if they choose. View these forms and the press release, followed by a fact sheet about the new rule, at the link below:

http://www.hud.gov/news/release.cfm?content=pr08-175.cfm

Shirley Nault has been a mortgage professional for over 20 years. Visit her other mortgage web sites go to: www.naultfhatips.blogspot.com or www.dutips.blogspot.com