Consumers Find Home Loan Process Confusing

May 1, 1997

WASHINGTON, D.C.--Many borrowers say they get too much information when they go through the home-lending process, making it difficult to figure out how much their loan will cost, according to a study commissioned by the Mortgage Bankers Association of America.

The study, conducted by Yankelovich Partners for the MBA, also found that 28 percent of those polled had encountered unanticipated fees. Yankelovich surveyed 500 people who financed a home in 1996.

Borrowers confused by the loan process say the experience could be improved by reducing the paperwork and providing an explanation of all fees.

HUD Directs Lenders to Protect Seniors

WASHINGTON, D.C.--To protect senior citizens from unnecessary fees, the U.S. Department of Housing and Urban Development has directed 8,000 FHA-insured mortgage lenders to stop doing business with companies that charge consumers for information on HUD's Reverse Mortgage Program.

The action comes after HUD announced it's probing companies that charge fees for information that's free through HUD's telephone information line, 888/466-3487.

"By barring FHA lenders from dealing with companies that charge huge fees to act as unneeded middlemen for HUD's reverse mortgage loans, we'll make it impossible for those companies to continue taking advantage of older Americans," says Andrew Cuomo, HUD secretary.

Elyse Umlauf-Garneau is a Chicago-based freelance writer and former senior editor with REALTOR® Magazine.

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