Fair Mortgage Practices Act of 2007

Hi Everyone,

I would like to share some information about the Fair Mortgage Practices Act (FMPA) which would result in creation of national system for registering loan originators. And is part of the proposed amendment to the Truth in Lending Act (TILA).

The main feature of this bill sponsored by Rep. Spencer Bachus will be a one page disclosure form for all credit plans of consumer. This form will be given to borrowers 3 days before closing wherein loan amount, property's appraised value & how much percentage of the appraised value is being borrowed will have to be disclosed by lender.

This form will clearly spell out:

1. Number of years on the loan & maturity date on it with separate section that will explain the initial rate, how long the initial rate would be for and maximum increase the rate can have.


2. Another section will be about borrower's income. This section will clearly highlight borrower's income figure. There would be separate lines to show the percentage of his income that will be consumed if rates were to move up on his loan.


3. One separate section will provide details of special factors that borrower must be aware of like prepayment penalty, fees, points, balloon payments, and closing costs.

If you have more information about this bill please share it with us.

Thanks
Blue