As a homeowner in the United States, you have certain rights under the Real Estate Settlement Procedures Act of 1974. According to the Department of Housing and Urban Development, RESPA protects homebuyers by requiring disclosure of lender fees and prohibits excessive fees and kickbacks during the home financing process. RESPA also outlines procedures for the settlement process when closing on your home; when you close on a property you are transferring title from the seller to the buyer. During the closing process the purchaser assumes the mortgage and takes legal possession of the home.
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The RESPA legislation also requires lenders to disclose their fees and lending conditions at various points during the buying process. RESPA spells out certain rights and protections for homeowners pertaining to their mortgages. Here is the basics of that protection.
1. As a homeowner you have the right to shop for your mortgage loan and compare the fees and interest rates from as many mortgage lenders as you choose.
2. You will be informed of the total costs associated with any mortgage. Mortgage lenders are required to disclose all fees, interest rates, and any add on expenses.
3. You have the right to a good faith estimate of all mortgage fees and closing costs before closing on the mortgage.
4. Mortgage lenders are required to disclose all aspects of the loan prior to signing.
5. You have the right to an explanation of all language used in the contract and any fees you are required to pay.
6. If your mortgage application is denied you have the right to a fair explanation as to why you were denied credit.
Many homeowners take these protections for granted today; however, it is the Real Estate Settlement Procedures Act of 1974 that guarantees homeowners in the United States these protections. If you suspect a lender is in violation of this legislation contact your local HUD office. For more information on Albuquerque Mortgage Refinance, sign up for our free mortgage guide: “Five Things You Need to Know Before Refinancing Your Mortgage.”