Government entities has got a set of mortgage laws to govern the mortgage lending process. There are also laws to guard borrowers rights and financial information. The borrowers should become aware of these mortgage laws and consumer rights to be able to handle odd situations in mortgage.
Mortgage laws as well as the consumer rights
Allow me to share the few basic mortgage laws and consumer rights that a borrower should be aware of:
1. Fair Commercial collection agencies Practices Act: As outlined by this Act, loan companies should treat the borrowers in the just manner. The Act forbids many ways of debt collection. As outlined by FDCPA, the debt collectors cant use unfair, abusive practices while dealing with customers. Additionally, it prevents the debt collectors from divulging consumers' debt information to 3rd parties.
2. Real estate property Settlement Procedures Act: This consumer protection law basically covers purchase mortgage, refinance loans, assumptions, improvement loans, and home equity a line of credit for 1-4 unit houses. According to RESPA, the borrowers possess the to certainly get certain disclosures through the lenders in the various stages of lending process. What's more, it forbids certain practices that will boost the unusual closing costs.
3. Equal Credit Opportunity Act: This Act prevents credit discrimination based on age, marital status, religion, gender, race, nationality, or receipt of public assistance. ECOA monitors content of the application, standard questions, and verbal or written opposition of the application.
4. Truth in Lending Act: This is the area of the Credit rating Protection Act. This law specifies that particular written disclosures have to be provided to the borrowers. A few of the disclosures that borrowers are entitled to get are finance charge, interest rate, total sales price, and total payment. The Act also preserves rescission rights for consumers. That is just about the most important mortgage laws and consumer rights that one got to know.
5. Mortgage loan Disclosure Act: According to this Act, lenders have to provide public loan data on accepted and rejected loans.
6. Fair Housing Act: This Act forbid discrimination in housing related transactions based on physical disability, gender, religion, race, color, nationality, or familial status.
Finally, one of the most important mortgage laws and consumer rights could be the New Homeowner's Protection Act. The Act specifies rights of house owners and rules for lenders concerning private mortgage insurance (PMI) cancellation.
