New Home Buyer? Know Your Rights
Are you purchasing your first home? Congratulations! It’s a huge investment, and it comes with a lot of steps, paperwork and regulations. Luckily, you have many rights that will help protect you and your investment. Moreover, companies like Universal Buyers Agents Sunshine Coast are at your service, too.
Understanding your rights will help you through the complicated process of applying for a loan and closing on the real estate transaction. While the rights of a new home buyer is a complicated topic, here is an overview of the most important laws you should know about.
Fair Housing Law
The Fair Housing Law is in place to ensure that all first-time homebuyers receive equal treatment and consideration, regardless of their race, nationality, color, religion, gender or handicap status. This law makes it illegal for anyone who provides a loan or housing services to discriminate against their applicants. The Fair Housing Law is enforced by the U.S. Department of Housing and Urban Development (HUD).
Homeowner Protection Act of 1998
This Act safeguards homeowners who have obtained a conventional loan from having to unnecessarily pay Private Mortgage Insurance or PMI. It requires all lenders to automatically cancel any PMI payments for homeowners who have reached 22% equity. It also entitles homeowners who are in good standing to request a cancellation of their PMI payments once they have 20% equity.
Real Estate and Settlement Procedures Act (RESPA)
In accordance with RESPA, loan originators are required to disclose the terms and costs of obtaining a home loan. They are required to give loan applicants a Good Faith Estimate, which is designed to assist the homebuyer in understanding the fees that are associated with the type of loan they are offered.
Secure and Fair Enforcement for Mortgage Licensing (S.A.F.E.) Act of 2008
The S.A.F.E. Act is a federal law that grants consumers a way to verify the licensing status of any loan or mortgage company, provided they are required to have a state-issued license. Under this law, the Nationwide Mortgage Licensing System (NMLS) was created. The NMLS allows consumers to check if their loan originator meets their state licensing requirements. However, loan officers that are employed by nationally chartered banks are not subject to this requirement.
Fair Credit Reporting Act (FCRA)
The FCRA covers the way in which homebuyers’ credit information is managed by the major credit bureaus. It also allows them to dispute and discrepancies they may find in their credit reports that may hinder them in the home buying process. The FCRA also permits consumers to obtain a free credit report from each of the three major credit bureaus every 12 months via www.annualcreditreport.com in order to properly manage their credit in preparation for the home buying process.
Buying a home is a huge endeavor, and for the first-time homebuyer, it can be overwhelming. But the law is on your side. When purchasing your first home, you should know what your rights are before obtaining a loan and signing any documents relating to the property acquisition. If you need additional help, consider hiring a real estate lawyer to assist you.
Written By Brad Denton
1930 N Arboleda #201
Mesa, Arizona 85213
40 N Central Ave #1400
Phoenix, AZ 85004
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