The Home Mortgage Disclosure Adjustment Act covers five different types of lending institutions. When one is shopping for a home, one should make sure to know the different types of institutions that can qualify under the Home Mortgage Disclosure Act. The law was enacted to allow lenders to adjust loan programs if needed for better consumer protection. To find out which types of lending programs are covered, the federal Office of Housing and Urban Development can provide this information via: https://regulatorysol.com/hmda-scrubs/. If you have an existing mortgage, the act also applies to you. As defined, the Home Mortgage Disclosure Adjustment Act covers closed-end mortgage loans. This means that there are two preceding years when the loan was closed and no payments are outstanding. The lender must report this type of closed-end mortgage loan on the borrower's application and this is the main purpose of the Home Mortgage Disclosure Adjustment Act. These helpful resources exempts certain small banks and Credit Unions if they meet the requirements: Lenders who have originated 100 or more closed-end loans in both the previous two years (typical home mortgage loans) will be exempted from reporting to the Federal Government under the HAMP program. Any lending institution that meets the qualifications is required to register with the Department of Housing and Urban Development to participate in the HAMP program. While the intent is to level the playing field between large and small banks, the regulations can apply to any lending institution that comes within the Act's reporting requirements. Loan activity is one of the main things that HUD focuses on when they review applications to qualify for HAMP and other similar programs. For instance, most HUD foreclosure homes are sold through local real estate agents, sometimes by requiring a minimum purchase amount. This can limit the number of potential buyers and greatly affect the reported values of properties. To combat this problem, the disclosure adjustment act allows real estate agents to inform their clients of the required minimum purchase amounts for closed-end transactions and use these figures as a standard in determining the appropriate closing costs for their clients. Although the Fair lending Act covers most major institutions of trade, it does not cover some of the smaller institutions that are not covered by government programs. For example, the Home Mortgage Disclosure Adjustment Act does not cover commercial mortgage credit institutions such as banks and thrift institutions. These types of institutions would fall outside the scope of the Fair lending Act. To be properly regulated by HUD, all institutions of trade must register with the department and submit annual reports regarding their mortgage credit activities to prove that they are indeed following HAMP guidelines. For institutions of trade that are found to violate these regulations, HUD can penalize them up to ten percent of their loan principal and require repayment of this money along with interest owed. As an effect of the Home Mortgage Disclosure Adjustment Act, all brokers and salesmen have to register with HUD and provide updated information about the terms of their home loans and closing costs. This means that brokers who fail to comply with the new law violate their professional responsibilities. If this information is inaccurate or incomplete, brokers may be subjected to fines and even suspension and termination from their brokerage jobs. Even lenders who are subject to the Home Mortgage Disclosure Adjustment Act need to register with the department to prove that they are following HAMP guidelines and that they have not violated any laws regarding the processing of home loans and closing costs. Although the Home Mortgage Disclosure Adjustment Act covers all home mortgage lenders, it falls on the shoulders of HUD-approved brokers and salesmen to ensure that they are following guidelines stipulated by the law. If you find yourself in the position of having unpaid balances on your home mortgage loans or having defaulted on your credit card payments, contact your local housing authority or your state's attorney general's office to inquire whether or not your lender is required to register under the Home Mortgage Disclosure Adjustment Act. You should also find out what your state's regulations are regarding the home mortgage disclosure act. If you are a borrower with bad credit, you can still apply for refinancing through one of the many government programs that aim to help borrowers who have fallen on hard times during the recession. For more information, click here: https://www.dictionary.com/browse/mortgage.
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