Here are 7 questions to ask your mortgage lender
On the Money From the August 7, 2009 print edition The Federal Reserve Board has proposed changes to Regulation Z, which is how the Truth in Lending Act is enforced. Since 1968, Regulation Z and the Truth in Lending Act supposedly have been protecting consumers from deceptive lending practices. The Federal Reserve Board has proposed changes in both the content and timing of what will be required of mortgage lenders. In general, Regulation Z directs that disclosures be made to potential borrowers during the application, underwriting and consummation process. Underlying the regulation’s effectiveness is the assumption that the potential borrower will read, and understand, the implications of the disclosures. Lenders will be required to supply a new one-page Federal Reserve Board publication, titled “Key Questions to Ask About Your Mortgage,” which would explain potentially risky features of a loan. Whether enacted into law or not, the following seven questions contained in the new publication are worth asking the lender: Will my monthly payments reduce my loan balance? Some loans let you pay...
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