Since the days of the Wild West in doing home mortgages, more and more tightening of appraising and mortgage lending is occurring. I think the changes are for the good, since you can blame the banks, wall street and some large mortgage companies who are no longer in business for the meltdown we had in the housing market.

There is so much double talk in some mortgage companies, such as advertising low teaser rates to lure you into doing business with them. Once you start working with these companies, the true cost of the loan becomes apparent. I always advise my clients to work with their local bank or mortgage company, rather then an online mortgage company. My experience with them is that they tell you the rate for your mortgage upfront and that’s what you get.

The locals know the market better, and in Nevada County and other Gold Country Counties that is very important. These counties tend to have a variety of homes, and there are few if any major subdivisions. Getting a comparable home to the one you may buy is sometimes quite difficult. Unlike a large city, where you may have a thousand homes that are similar, here you are lucky to find another home similar to yours.

Anyhow, the new rules that revise the disclosure requirements for mortgage loans under Regulation Z (Truth in Lending) went into effect July 30, 2009. The revisions implement the Mortgage Disclosure Improvement Act (MDIA), which was enacted in July 2008 as an amendment to the Truth in Lending Act (TILA). It is possible that these new requirements may cause delays in getting loans, and if you are purchasing a home, it may delay your closing date.

The MDIA requires creditors to give good faith estimates of mortgage loan costs (“early disclosures”) within three business days after receiving a consumer’s application for a mortgage loan and before any fees are collected from the consumer, other than a reasonable fee for obtaining the consumer’s credit history, according to information from the Federal Reserve. The MDIA also requires early disclosures for loans secured by dwellings other than the consumer’s principal dwelling, such as a second home.

In addition, the rules would implement the MDIA’s requirements that creditors wait seven business days after they provide the early disclosures before closing the loan; and that creditors provide new disclosures with a revised annual percentage rate (APR), and wait an additional three business days before closing the loan, if a change occurs that makes the APR in the early disclosures inaccurate beyond a specified tolerance, according to the Federal Reserve. The rules also would permit a consumer to expedite the closing to address a personal financial emergency, such as a foreclosure.