Q: What information goes on the Loan Estimate form – page 2?
A: Four main categories of charges are disclosed on page 2 of the Loan Estimate:
A good-faith itemization of the Loan Costs and Other Costs associated with the loan. (§§ 1026.37(f) and (g))
A Calculating Cash to Close table to show the consumer how the amount of cash needed at closing is calculated. (§ 1026.37(h))
For transactions with adjustable monthly payments, an Adjustable Payment (AP) Table with relevant information about how the monthly payments will change. (§ 1026.37(i))
For transactions with adjustable interest rates, an Adjustable Interest Rate (AIR) Table with relevant information about how the interest rate will change. (§ 1026.37(j))
The items associated with the mortgage loan are broken down into two general types, Loan Costs and Other Costs. Loan Costs are those costs paid by the consumer to the creditor and third-party providers of services the creditor requires to be obtained by the consumer, generally during the origination of the loan. (§ 1026.37(f)).
Other Costs include taxes, governmental recording fees, and certain other payments involved in the real estate closing process. (§ 1026.37(g))
These two tables have additional specific requirements, as discussed below and in section 2.3 of the TILA-RESPA Guide to Forms.
Items that are a component of title insurance must include the introductory description of “Title” followed by a dash or hyphen and then a description of the specific title insurance component (e.g. “Title – Lender’s Title”). (§§ 1026.37(f)(2)(i) and (g)(4)(i))
If state law requires additional disclosures, those additional disclosures may be made on a document whose pages are separate from, and not presented as part of, the Loan Estimate. (Comments 37(f)(6)-1 and 37(g)(8)-1)
Subject to the terms of the legal obligation, both specific and general lender credits are included under Lender Credits. (Comment 37(g)(6)(ii)-1)
Note: Construction loan inspection and handling fees are Loan Costs. These fees are disclosed differently depending on whether they are collected at or before closing or after closing. See section 14.18 for more information about the disclosure of construction loan inspection and handling fees. (Comment 37(f)-3)