Mortgage Loan Disclosures: What Every Borrower Should Know 🏠📑

by Luke Grasso NMLS #2638025

Buying a home is exciting, but it’s also a complex financial process. To ensure transparency and fairness, lenders are required to provide key disclosures that explain loan costs, terms, and protections for borrowers. Here’s what you need to know before signing on the dotted line! ✍️💰

📜 Essential Mortgage Loan Disclosures

1️⃣ Loan Estimate (LE) 📑

✔️ Given within 3 business days after applying for a mortgage.

✔️ Shows loan amount, interest rate, closing costs, monthly payments, and total loan costs.

✔️ Helps borrowers compare loan offers from different lenders.

2️⃣ Closing Disclosure (CD) 🏡

✔️ Provided at least 3 business days before closing.

✔️ Breaks down final loan terms, costs, and payments.

✔️ Helps borrowers review everything before committing to the loan.

3️⃣ Truth in Lending Act (TILA) Disclosure 💰

✔️ Explains the APR (Annual Percentage Rate) and total loan costs over time.

✔️ Ensures borrowers understand finance charges and interest costs.

4️⃣ Homeownership Counseling Disclosure 🏠

✔️ Required for high-cost loans to educate borrowers about financial risks.

✔️ Helps homeowners make informed decisions.

5️⃣ Equal Credit Opportunity Act (ECOA) Notice ⚖️

✔️ Confirms that lenders can’t discriminate based on race, religion, gender, or other protected factors.

✔️ Ensures fair lending practices.

6️⃣ Fair Lending & Anti-Steering Disclosure 🚦

✔️ Prevents lenders from pushing borrowers toward higher-cost loans when better options exist.

✔️ Confirms the loan offer is in the borrower’s best interest.

7️⃣ Servicing Disclosure Statement 🔄

✔️ Tells borrowers whether the lender will keep servicing the loan or transfer it to another provider.

✔️ Helps homeowners prepare for possible loan servicer changes.

8️⃣ Affiliated Business Arrangement (ABA) Disclosure 🤝

✔️ Required if the lender refers borrowers to related businesses (like title companies they own).

✔️ Ensures transparency about potential business relationships.

9️⃣ Privacy Policy Disclosure 🔒

✔️ Explains how borrower personal information is collected, used, and protected.

✔️ Helps homeowners understand data security and their rights.

🔟 Right to Receive an Appraisal Report 📊

✔️ Borrowers have the right to receive a copy of their home appraisal before closing.

✔️ Ensures fair property valuation.

💡 Why These Disclosures Matter

Understanding mortgage disclosures helps borrowers:✅ Compare loan offers more effectively

✅ Avoid surprises at closing

✅ Understand their legal rights in the lending process

✅ Make informed financial decisions

***See the downloads section below the education articles for a .PDF checklist of these items you should be receiving regardless of whom is assisting you.