Sen. Bond proposes mortgage disclosure requirements

Bond said in a news release that homebuyers often don’t understand or are misled regarding loan terms, and that there is a need for more transparency and disclosure.

The proposed amendment would require advance disclosure of the mortgage’s initial fixed rate and payment, the date the fixed rate expires and becomes adjustable, an estimate of the adjustable rate and payment, and a statement that there is no guarantee that the borrower will be able to refinance the loan before the fixed rate ends. The amendment also requires disclosure of any prepayment penalties.

Bond is ranking member of the Senate Appropriations Subcommittee for Housing and Urban Development.