The value of an agent really shows when it comes to making sure your transaction will actually CLOSE once you have a contract.  We keep up-to-date on contract law and mortgage requirements in order to protect our clients.  Here's an update from today on Truth In Lending law...

Bank of America, our in-office lender, provided us today with the revised rules that govern early Truth In Lending (TIL) disclosures.  These changes are effective on July 30, 2009, and apply to ALL lenders:

1.  Customers must receive an initial TIL no less than 7 business days prior to closing.  (Saturday is counted as a business day, but you don't count the day they were given the TIL or the 7th day).  So for an example, if they were given the intial TIL on Monday, August 3rd; the soonest they could close would be Wednesday, August 12th.

2.  Customers must receive a final TIL no less than 3 business days prior to closing.  And the lender must have evidence in the file that the borrower has received the final TIL (not just that we sent it to them).  

3.  What are the items that effect whether the TIL changes?  Interest rate, origination fee, discount points, escrow waiver fee, tax service fee, processing fee, underwriting fee, courier fee, flood cert, wire fee, days of prepaid interest, MERS fee, Attorney fee, Attorney wire fee, Attorney Doc Prep fee, VA funding fee, FHA financed MIP, and Private Mortgage Insurance.  If any of these items are paid by the borrower and change from the time we send the final TIL until the closing - then it is going to effect the TIL and we have to re-disclose and 3 more business days must pass.  

4.  The good news is that we have implemented a pretty solid system for both complying with these required changes and for avoiding busted closings.  But we will need the real estate agent's help; the attorney's help; and the customer's help in making it work.  

Obviously, we need to get a fully-executed COMPLETE sales contract with the exact closing date; sales price; loan amount; closing attorney; and costs paid by seller as quickly as possible.  This has always been true; but now more than ever.  

Next, anytime the seller is paying money on the purchasers behalf we need it to say, "Seller agrees to pay $______ towards closings costs and or prepaid items".  This will allow us to apply seller paid costs towards prepaid interest without ambiguity.  

Then, we need to get the closing attorney's exact charges as soon as possible.  

And last, we need to impress upon the customer how important it is to return paperwork back to us in a timely manner.  In most cases we will be sending the final TIL well before the 3 day minimum requirement. But remember we must not only be able to show that the customer has been sent the final TIL - but that they acknowledge receipt of it.  So it does us no good to get it out early and then the customer hangs on to it until the day before closing before he gets it back to us.  If that happens, the law is pretty clear.  We'll have to bust the closing and we'll have to wait 3 more business days before we can close.  That really should never happen as long as everyone(lender, agent, attorney, and customer) are focused on making these deadlines.

For more information on buying or selling real estate in Alpharetta, Roswell, or Cumming / Forsyth Georgia, visit our local sites: www.MoveToAlpharetta.com or www.BuyInRoswell.com or www.ForsythHomesAndLand.com or contact me at 770-365-4977 for an immediate response.