What Applicants Receive the Homeownership Counseling List?

Is a bank required to send the homeownership counseling list to applicants for all federally related mortgage loans, regardless if they are high cost mortgage loans or not?

Under the Real Estate Settlement Procedures Act (Regulation X), a list of homeownership counseling organizations must be provided to all applicants for federally-related mortgage loans not later than three business days after the bank receives an application or sufficient information to complete an application.

Applicants for home equity lines of credit covered by Regulation Z can be provided with the list either within the three business day period or at the time of application. Reverse mortgages and timeshare loans are exempted. 12 CFR §1024(a), (b) & (c).

While sections 34(a)(5) and 36(k) of Regulation Z require an applicant to provide certification that homeownership counseling has been completed, before a high cost mortgage loan or negative amortization loan to a first-time home buyer can be made, there is no requirement limiting the disclosure to such applicants.

This entry was posted on Monday, January 13th, 2014 at 3:00 pm.