Homebuyers that finance their newly purchased Lakeland Real Estate will be signing a new version of the HUD-1 Settlement Statement beginning January 1, 2010. While the new form resembles its old form, there are minor changes on page 2 from lines 800 through 1300 in which certain charges that a Lakeland borrower was shown on the Good Faith Estimates given by their lender are carried over to the updated HUD-1 Settlement Statement. This will give Lakeland home buyers and those looking to refinance Lakeland homes a clearer picture of what they have been quoted by their lender to as opposed to what they are actually paying for it at the closing table.
The biggest change in the HUD-1 Settlement Statement is the addition of page 3 which states that certain charges can and cannot increase, and charges that in total cannot increase more than 10%. For example fees that cannot exceed 10% or more are:
- Government recording charges
- Mortgage insurance premium
- Survey
And for the first time, some of the charges stated in the Good Faith Estimate (GFE) must coincide with the HUD-1. These are:
- Our origination charge (lender’s origination fee)
- Your credit or charge (points) for the specific interest rate chosen
- Your adjusted origination charges
- Transfer taxes
Moreover, the addition of the loan terms are reiterated in plain English on page three of the HUD-1 Settlement Statement, which outlines the terms of the loan you previously agreed with your lender in a somewhat of a “Question and Answer” form.
The only thing I want to point out regarding the stated term, “your initial monthly amount owed for principal, interest and any mortgage insurance”, there is no mention for any escrow, only a box for a check-mark for Principal, Interest, and Mortgage Insurance. However, the mentioning of Escrow is found on the bottom, which states, “Total monthly amount owed including escrow amount payments”.
The bottom line here is: What is really missing is the total monthly payment written in one place – Principal, Interest, Mortgage Insurance, and Escrow – and that are borrowers’ primary concern.
Furthermore, the new HUD-1 Settlement Statement clearly does not allow that any junk fees be added and therefore may save Lakeland Homebuyers and folks seeking refinancing additional monies.
I must say that altogether I agree with the overall improvements of the Good Faith Estimate and the HUD-1 Settlement Statement. Although I’m hoping these forms do not add any more confusion for the Lakeland homebuyers when purchasing their Lakeland Real Estate in the future, it certainly is the mortgage brokers and Lakeland FL Realtors® responsibility to go over the Good Faith Estimate and the HUD-1 Settlement Statement in detail to clear up any confusion prior to the closing or settlement date.