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Bill of Rights for Mortgage Consumers
The President of Fannie Mae came up with the Bill of Rights for mortgage consumers in January of 2000. It is a pledge of $2 trillion over 10 years, in order to help assist consumers buy their dream home. It also gives consumers the ability to view what is considered when determining if they are creditworthy or not, as well as the application process for a loan.
Another one of the main goals of the Bill of Rights is to help bring more technology to the mortgage industry, while reducing the amount of paperwork that needs to be filled out by 17%. Instead of relying so much on papers, more automated technology will be used. What this means is faster loan approvals.
Some of the basic rights included in the Mortgage Bill of Rights include:
All Americans have a right to access mortgage credit. More measures will be taken to prevent instances such as discrimination, predatory lending, and fraud.
Consumers will have the right to the lowest cost mortgage that they qualify for. Some of the measures that Fannie Mae will take are in order to allow lenders to qualify more mortgage consumers at low cost financing. There are programs designed to help meet the needs of women, first time home buyers, minorities, and others. There is even a program that will qualify you for mortgage rates for 2% less than the mortgage market if your credit is not perfect.
Homeowners have the right to know the true cost of a mortgage. It is important to know all of the rates included, such as down payments, interest rates, points, closing fees, appraisal costs and insurance payments. To assist you with this, Fannie Mae has designed a "True Cost" calculator.
Homeowners have the right of free regulatory burden. This will prevent too much intrusion from the government with things such as paperwork. Local ordinances and laws still need to be followed, of course.
Homeowners have the right to know about mortgage decisions. This will help you know what is going on throughout the application process. It is important to find out anything that you may be wondering from your broker, banker, or lender. |
