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Disclosures |
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Disclosures Related to Condition of Property Disclosure #40: Adjustable Rate Loan Mortgage Disclosure 1. Purpose: To disclose that this loan permits changes in the interest rate. The disclosure covers the details of when the rate can change, how often it may change and what restrictions apply to how much it may increase. 2. Whom does it protect? The lender. 3. What rights do you give up? If there is a dramatic increase in you payments your signature indicates that you understood that was possible. If you payment becomes unaffordable due to increases in the rate, you have no recourse against the lender. *Note: Borrower Beware! Calculate the payment at the highest possible rate. Can you afford that payment?
Disclosure #41: Notice to Borrower About Flood Risk Information 1. Purpose: To tell the buyer that the home they are purchasing is located in an area which has been identified as low risk for flooding. 2. Whom does it protect? The builder and/or lender 3. What rights do you give up? The buyer/borrower cannot later claim they were unaware of the possibility should the home later have flood damage or have flood insurance mandatory.
Disclosure #42: Lien Position Letter 1. Purpose: To establish the position this lien will have relative to who is the primary lender covered should there be a default on the loan. The first lien holder will be paid first, and the second lien holder will be paid if funds allow. 2. Whom does it protect? The lender(s) and/or the title company. 3. What rights do you give up? This sample indicates the title company closing agent is the person who signed. The lender cannot later claim they were not aware of the position of their lien rights.
1. Purpose: To show the borrower how your property sits on the lot in relationship to the property lines and easements. 2. Whom does it protect? The title company, lender, and/or real estate professionals associated with the transaction. 3. What rights do you give up? Your signature (always required on the survey itself) indicates you understand the placement of the easement, fence, and driveway. You cannot later claim you weren’t told and shown exactly where the lines were if there is any problem related to an encroachment or the location of the dwelling.
Disclosure #45: Disclosure of Lead-based Paint Poisoning 1. Purpose: To allow sellers and Realtors to tell you if they have any knowledge about lead problems or reports associated with the home being sold. Also, to allow buyers to disclose if they have received a copy of the lead paint pamphlet and given the opportunity to order lead paint testing, if desired. 2. Whom does it protect? All parties, including the Listing Realtor, seller, and buyer. 3. What rights do you give up? BUYER: Cannot later claim to have reason to sue seller or seller’s agent because of lead problems with the house. SELLER: Cannot claim that listing agent failed to provide required pamphlet and inform them of their legal responsibilities concerning reports associated with lead paint.
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