Selling Reno And Sparks Real Estate Blog


The New Mortgage Laws for 2014 ~ Are You Familiar With The Changes?



Looking for a house

Do your plans for 2014 include buying a new home? If you are thinking of financing a new home this year you have probably already heard or read about the new federal regulations that recently took affect & changed the rules that apply to mortgage lending.

The new rules are aimed to take a "back to basics" approach to mortgage lending and lower the risk of defaults and foreclosures among borrowers  Federal regulators say these new rules will make it more difficult for some people to get a mortgage but will mostly work to the consumers benefit. Basically if you have good credit and an ability to make a monthly mortgage payment you should be able to qualify for a home loan.

If you are a current homeowner or considering a mortgage during the next year, I recommend you visit the Consumer Financial Protection Bureau or your lender for additional details and information.

Below is a quick look at some of the new rules that went into affect on January 10, 2014:
Computer keyboard concept

The Ability-To-Repay Rule ~ This rule requires lenders to make sure borrowers can actually afford and make loan payments throughout the life of the loan. Lenders will be looking at the borrowers debt-to-income ratio which will determine how much one can afford to pay each month.

Weighing income, assets, savings & debt to determine affordability are all considered. All basic things that will protect home buyers ability to repay what they borrow.

The Qualified Mortgage ~ A new class of mortgage (A.K.A. The QM). This is a mortgage that you are assumed to be able to repay for many years rather than a short period of time. The Qualified Mortgage meets new guidelines and borrowers who obtain them are presumed to meet the ability-to-repay requirements. The borrowers debt-to-income ratio  cannot exceed 43% (including the mortgage). QM's cannot include risky features such as interest only loans, terms that are longer than 30 years & up front fees cannot be more than 3% the mortgage balance. Basically the borrower is qualified to get a loan and will be able to repay this loan.

Things for mortgage borrowers to keep in mind in 2014:

Custumers paying at the hotel

Document your finances ~ Underwriters are going to be extra diligent at looking at borrowers income and expenses in 2014. Keep good records of your bank statements, tax returns, assets, extra income you may be earning. Be ready to show and explain all bank deposits and banking activity.

Lock Your Interest Rate ~ Interest rates are expected to rise in 2014 so keep a close on the what they are doing. Lock a rate as soon as your are comfortable with a rate.

Borrower Rights ~ Mortgage borrowers will get many new rights as consumers this year as the new mortgage rules go into affect . If you run into issues with your mortgage servicer in 2014 or fall behind on your payments, make sure you are aware of your rights and put them to use. With the new 2014 rules lenders are now required to address borrowers problems within 45 days or explain to you in writing why the problem cannot be fixed.  Be sure to put your complaint in writing!!!

Clean Up Your Credit ~ It's nearly impossible to get a mortgage without decent credit these days. That will continue to be the case in 2014. If you are planning to get a mortgage, monitor your credit history and score until your loan closes. The best mortgage rates usually go to borrowers with credit scores of 720 or higher. You may still get a mortgage with a score of 680, but lower scores will mean higher rates or higher closing costs. So watch your credit card spending and pay those each month.

New Mortgage Laws On January 10, 2014 ~ What You Need To Know

The New Mortgage Laws for 2014 ~ Are You Familiar With The Changes?

****This blog was originally posted @ MyRenoHomeSearch written by Terrie Leighton 01/2014

Your Home. My Priority. Since 2003

NV LIC: S.0061129

Certified Distressed Property Expert (CDPE)
Certified Default Resolution Specialist (CDRS)
Short Sales & Foreclosure Resource ~ Certified (SFR)
NAR's Green Designation ~ Certified Green
Certified Negotiation Expert (CNE)
Property Manager NV PM# 167199

Ferrari-Lund Real Estate

 Cell ~ 775.846.5424

Email ~


Facebook   LinkedInTwitter

Comment balloon 6 commentsTerrie Leighton • January 28 2014 01:29PM


 Hello Terrie and VB didn't know about this, great information!

VB ;o)

Posted by Robert Vegas Bob Swetz over 6 years ago

The lending industry has been, and is making a lot of changes; so much so that it is difficult to stay ahead. I always have to refer to my lender when I hear of new things so I can try and understand what is going on. It has become much more difficult for people to buy homes these days, but that may be a good thing based on the real estate crash in recent years.

Posted by Troy Erickson AZ Realtor (602) 295-6807, Your Chandler, Ahwatukee, and East Valley Realtor (Good Company Real Estate over 6 years ago

Hello again Terrie ... VB has decided to feature your post to the group:

All Real Estate - Today & Tomorrow

Because as brokers and agents we are constantly learning new laws & rules within the industry.


Posted by Robert Vegas Bob Swetz over 6 years ago

Well VB that is very kind of you! I sure appreciate you sharing with your group!!

Posted by Terrie Leighton, Reno Real Estate Agent ~ Selling Homes in Reno (Ferrari-Lund Real Estate ) over 6 years ago

I think that these changes will benefit everyone. Yes, it will reduce the number of potential buyers but on the other hand it will benefit sellers in the future as they will not have to compete with short sales, REO, et.caused by bad mortgages.

Posted by Jim Sinnott, Realtor, GRI Licensed in MA and RI (Bedard Realty) over 6 years ago

Thank you Jim!

Posted by Terrie Leighton, Reno Real Estate Agent ~ Selling Homes in Reno (Ferrari-Lund Real Estate ) over 6 years ago

This blog does not allow anonymous comments