Pub. 4 2014-2015 Issue 1

10 O V E R A C E N T U R Y : B U I L D I N G B E T T E R B A N K S - H E L P I N G C O L O R A D A N S R E A L I Z E D R E A M S The final form that the CFPB developed is a three page form. The final form de-emphasizes APR because, in testing, the con - sumers found the APR to be confusing, but includes some new disclosures that were mandated by Dodd-Frank, such as total interest percentage and the “In 5 Years” calculation. Second, there aremultiple versions of the loan closing form to account for different transaction types, for example a refinance and a purchase have different forms fromeach other. Thiswill be a training concern—ensure lending staff understands the definition of each type of transaction and the “real purpose of the loan.” For instance, staff should be able to differentiate between a land-only loan, construction-only and construction-to-permanent loan. There also is a “seller-only” form required for closed-end loans in residential transactions. Other loans, such as reverse mortgages and home equity lines of credit and other mortgages secured by a mobile home or by a dwelling that is not attached to the real property, will still use the HUD-1 form. The new Loan Estimate co-mingles lender and settlement costs with loan terms and replaces theHUD line numbers with an alphanumeric system. The Closing Disclosure itemizes the costs and includes section totals rather than lumping costs together and rolling them up into one line item. Because the form is a combi- nation of loan information and settlement costs, communication and cooperation between the lender and closing agent is vital. If the settlement agent completes the loan closing disclosure form, the lender needs to provide a copy of the loan estimate form to provide the information necessary for an accurate Closing Disclosure. Third, the initial Loan Estimatemust be delivered ormailed to the borrower no later than three business days after the lender receives the mortgage application and no less than seven business days be- fore consummation of the loan. A revised Loan Estimate due to changed circum- stances must be delivered or placed in the mail within three business days of the lender’s knowledge of a changed cir- cumstance; however the borrower must receive it no later than four business days before consummation of the loan. The borrower must receive the Clos- ing Disclosure no later than three busi- ness days prior to the consummation of the loan. A revised loan Closing Disclo- sure can, inmost cases, be delivered and received at the closing. Key points of the Three-day Rule include: • If disclosures are not delivered in person, but are instead delivered by mail, electronic media or a courier; the borrower is considered to have received the disclosure three business days after being placed in the mail, sent by email or placed with a courier. Accordingly if delivering other than in person, an additional three business days is required in order to ensure receipt by the borrower no later than three business days prior to consummation. CEDCO Small Business Finance Corporation Your Best Soursce for SBA Real Estate Loans New Easier Qualification Uninterrupted access to money through a monthly SBA-backed bond auction Low fixed-rate financing Low down payments CEDCO Small Business Finance Corporation Colorado’s SBA 504 Loan Expert TM 1175 Osage Street, Suite 110 Denver CO 80204 Denver 303-893-8989 Grand Junction 970-243-1852 www.cedco.org  More stability for your operation  A stronger balance sheet  An asset to sell when you’re ready AS A LEADING SBA 504 LENDER WE MAKE IT EASY FOR YOU  Buy, Build, Remodel or Expand Real Estate  Purchase and install long-lasting equipment  Fast, expert processing - with low loan costs  Refinance may be an option  We lend up to $5 million: borrow up to $20 million when combined with bank financing  Interest rate as low as 5.25%, fixed for 20 years  Down payments range from 10% to 20%  Most small Businesses are Eligible STREAMLINED PROCESSING  Front Range and mid-mountains call Jeff or Mary Jane 303-893-8989  Western Colorado call Pat 970-243-1861  RESPA / TILA Reform – continued