Terms of The Real Estate Loan in Key West

Federal law requires that the lender reveal all costs of the loan, including such items as appraisal fees, escrow fees, fees for the lender's attorney, service charges, and, of course, the interest rate on the loan. The interest rate must be presented as the annual percentage rate or APR. This is calculated by including the interest to be paid along with other fees, such as any points paid to originate the loan.

Under the terms of the federal Truth in Lending Act, lenders are required to use the same methods for computing the cost of credit and disclosing credit terms. This requirement allows borrowers to fairly compare the costs and terms of home loans. It is a much more reliable method for comparing costs than the advertised rate of the loan.

The federal Equal Credit Opportunity Act prohibits discrimination in any aspect of a home loan transaction on the basis of race, religion, age, color, national origin, receipt of public assistance funds, sex, marital status, or the exercise of any right under the Consumer Credit Protection Act. If a lender rejects your loan application, you are entitled to know the specific reasons in writing.

Lenders are also prohibited from doing anything that discourages you from obtaining credit, including taking an excessively long time to process your application, being unwilling to discuss available types of loans, or failing to provide information required to apply for a loan. If you suspect that you are being discriminated against in applying for a loan, a complaint can be filed with the Office of Fair Housing and Equal Opportunity of the Department of Housing and Urban Development, Room 5204, Washington, D.C. 20410-2000, or online at http://www.hud.gov/complaints.html.  You also may file a complaint with the Federal Reserve Board of Governors or the District Reserve Bank serving your area. Check the government pages of the telephone book for their addresses or file directly with the Federal Reserve at http://www.federalreserve.gov/pubs/complaints When making a complaint, be sure to include your name and address along with name and address of the person or financial institution you are filing the complaint against, a short description of the alleged violation, and the date of the alleged violation.

Secure the real estate loan

The borrower will sign many documents; however, two documents are essential to completing the loan transaction. One is a promissory note agreeing to repay the lender the money borrowed plus interest. This promissory note is a legally enforceable contract. The borrower may be responsible for repaying the note even if he or she later sells the home to a buyer who assumes the mortgage. The second document is a mortgage, or deed of trust, and gives the lender a security interest in the real estate. Having a security interest in your home means the lender may enforce repayment of the loan by selling the property. If you do not pay, you could lose your home.