Introduction
When it comes to obtaining a mortgage loan, one of the most critical documents you'll encounter is the Closing Disclosure, also known as Form H-25(i). This form is a comprehensive document that outlines the key terms and costs associated with your mortgage transaction. Understanding the length and structure of this form is crucial for ensuring a smooth and transparent closing process.
What is Form H-25(i)?
Form H-25(i) is a standardized form that lenders are required to provide to borrowers at least three business days before the scheduled closing date. It serves as a final statement of the loan terms, fees, and other costs associated with the mortgage transaction. This form is mandated by the Consumer Financial Protection Bureau (CFPB) under the Truth in Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA).
The Length of Form H-25(i)
The length of Form H-25(i) can vary depending on the complexity of the mortgage transaction and the specific lender's practices. However, in most cases, the form typically consists of five pages. Here's a breakdown of what you can expect on each page:
Page 1: Loan Terms and Projected Payments
The first page of Form H-25(i) covers the critical loan terms, including the loan amount, interest rate, and the projected monthly payments. It also provides information about whether the loan has a prepayment penalty, balloon payment, or other specific features.
Page 2: Closing Cost Details
The second page is dedicated to outlining the closing costs associated with the mortgage transaction. This includes fees for services rendered by the lender, third-party services (such as appraisals and title insurance), and other costs like property taxes and homeowners insurance premiums.
Page 3: Calculating Cash to Close
Page three of the Closing Disclosure focuses on calculating the total amount of cash needed to close the loan transaction. It breaks down the closing costs, any funds required for prepaid items (like taxes and insurance), and any credits or adjustments that may apply.
Page 4: Loan Disclosures and Contact Information
The fourth page of Form H-25(i) provides important disclosures related to the mortgage loan, such as the Annual Percentage Rate (APR), Total Interest Percentage (TIP), and other legal disclosures. It also includes contact information for the lender, settlement agent, and other relevant parties involved in the transaction.
Page 5: Loan Calculations and Other Disclosures
The final page of the Closing Disclosure contains detailed calculations related to the loan, such as the amount financed, finance charge, and total payments over the loan term. It may also include additional disclosures or information specific to the lender or the mortgage product.
Conclusion
Understanding the length and structure of Form H-25(i) is crucial for borrowers seeking a mortgage loan. By familiarizing yourself with the five-page layout and the information contained on each page, you can better prepare for the closing process and make informed decisions. Remember, this form is designed to provide transparency and protect your rights as a borrower. If you have any questions or concerns, don't hesitate to consult with your lender or a trusted real estate professional.