Why you might want to apply for a mortgage before Oct. 3

Closing on a mortgage can bring you great joy and great stress. If your plans call for applying for a mortgage loan this year, consider submitting your loan application before October 3. You could save yourself from potential delays and the accompanying stress.

Why? That’s the date new federal rules for mortgage disclosures go into effect. Preparation for these changes has been going on for months, but no one knows exactly how the new rules will affect the lending industry. Real estate experts, however, predict that mortgage loans will take significantly longer to close.

What’s changing?
The Real Estate Settlement Procedures Act and Truth in Lending Act disclosures that have long been part of the mortgage process are being combined. Not only that, but there are new timelines for delivering the disclosures.

Why are these changes being made?
Currently, consumers get different disclosures with overlapping information. These new disclosure forms and regulations were designed to eliminate some redundancy and highlight information that consumers have found helpful.

These changes take positive steps toward ensuring all borrowers understand the mortgage process. The new disclosures and the process for delivering them are supposed to provide consumers with timely, clearly worded information that outlines the prices and risks associated with mortgage loans.

If these changes are helpful, why does it matter when I apply for a loan?
Such significant changes to industry standards and practices that have been in place for many years could cause delays as lenders, title companies and related service providers adjust to the new normal.

Certainly don’t rush to apply for a mortgage loan before you’re ready. But, if you’re planning to submit an application this year anyway, it might be wise to check with your lender about getting your loan in process under the existing rules that everyone is familiar with.