Posted on: 17th Nov, 2013 11:42 pm
What are the initial loan disclosures while you are buying a house? My lender said that these were not fully accurate and that the final loan papers will be completely accurate.
I guess the initial loan disclosure here means the pre-approval for the loan.
Initial disclosures disclose the COSTS and PREPAIDS.
COSTS charged by the Lender must be 100% accurate.
COSTS charged by third parties, like title insurance, recording the mortgage, your attorney fee, are estimated. They should be disclosed pretty accurately, just not to the penny.
PREPAIDS are disclosed and should be somewhat accurate. They include interest paid from date you close to end of the month and what date of the month you close is not known at application, it is just projected.
Prepaids also include the property taxes paid at closing and that is not known until you close, although should be disclosed somewhat accurately.
Prepaids also includes home insurance. You pay the first year premium before closing and then escrow. This is estimated but no one knows at application excatly what home insurance company you will use nor excatly what coverage you will get.
So, estimnated COSTS and PREPAIDS will not be exact until closing date.
COSTS charged by the Lender must be 100% accurate.
COSTS charged by third parties, like title insurance, recording the mortgage, your attorney fee, are estimated. They should be disclosed pretty accurately, just not to the penny.
PREPAIDS are disclosed and should be somewhat accurate. They include interest paid from date you close to end of the month and what date of the month you close is not known at application, it is just projected.
Prepaids also include the property taxes paid at closing and that is not known until you close, although should be disclosed somewhat accurately.
Prepaids also includes home insurance. You pay the first year premium before closing and then escrow. This is estimated but no one knows at application excatly what home insurance company you will use nor excatly what coverage you will get.
So, estimnated COSTS and PREPAIDS will not be exact until closing date.
