The consumer makes the first purchase, such as when a consumer opens a credit plan and makes purchases contemporaneously at a retail store, except when the consumer places a telephone call to make the purchase and opens the plan contemporaneously. Disclosures are always required, based on your state laws, whether youre using a real estate agent or selling your home on your own. (A) The first transaction occurs when a consumer contacts a merchant by telephone to purchase goods and at the same time the consumer accepts an offer to finance the purchase by establishing an open-end plan with the merchant or third-party creditor; (B) The merchant or third-party creditor permits consumers to return any goods financed under the plan and provides consumers with a sufficient time to reject the plan and return the goods free of cost after the merchant or third-party creditor has provided the written disclosures required by 1026.6; and. Reopening closed account. Each county has different applications and required documents. If a closed-end credit transaction is converted to an open-end credit account under a written agreement with the consumer, account-opening disclosures under 1026.6 must be given before the consumer becomes obligated on the open-end credit plan. Legal obligation. 1. If there is more than one consumer, the disclosures may be made to any consumer who is primarily liable on the account. The contractor charged $375,000. The prohibitions in 1026.5(b)(2)(ii)(A)(2) and (b)(2)(B)(2)(ii) on treating a payment as late for any purpose apply only during the 21-day or 14-day period (as applicable) following mailing or delivery of the periodic statement stating the due date for that payment and only if the required minimum periodic payment is received within that period. iii. Disclosures may be estimated when the exact information is unknown at the time disclosures are made. See A.R.S. Homeowners' Association Law - Michigan does not have a specific statute governing homeowners' associations. 3. The right to void the contract can be waived in writing by the buyer. If any information necessary for accurate disclosure is unknown to the creditor, it shall make the disclosure based on the best information reasonably available and shall state clearly that the disclosure is an estimate. 1026.35 Requirements for higher-priced mortgage loans. Which statement concerning Department if Veteran's Affairs (VA) mortgage loans is FALSE? (B) Open-end consumer credit plans. 1026.20 Disclosure requirements regarding post-consummation events. Purchases. See comment 5(b)(2)(ii)-2. In Arkansas, its also buyer beware unless the seller tells an outright lie about the home. 1. Furthermore, the prohibition in 1026.5(b)(2)(ii)(B)(1)(ii) applies only during the 21-day period following mailing or delivery of the periodic statement and applies only when the creditor receives a payment within that 21-day period that satisfies the terms of the grace period. 5. Which remedy for breach of contract requests that the courts award damages for the extent of loss suffered? When a consumer initiates a request, the creditor may permit, but may not require, the consumer to pick up periodic statements. See interpretation of 5(c) Basis of Disclosures and Use of Estimates in Supplement I. The periodic statement mailed on May 4 states that a required minimum periodic payment of $150 is due on May 25. See interpretation of Paragraph 5(a)(1)(ii)(A) in Supplement I. At the creditor's option, finance charge and annual percentage rate may also be disclosed more conspicuously than the other required disclosures even when the regulation does not so require. 515B). Heres what you need to know: On the books in most states, youll find laws related to seller requirements in disclosing what they call material facts about the home theyre selling. Which item would most likely be classified as a fixture once incorporated into real property? Language used in disclosures required in this subpart must be close enough in meaning to enable the consumer to relate the different disclosures; however, the language need not be identical. Notwithstanding paragraphs i and ii above, a card issuer that replaces a credit card or provides a new account number because the consumer has reported the card stolen or because the account appears to have been used for unauthorized transactions is not required to provide a notice under 1026.6(b) or 1026.9(c)(2) unless the card issuer has changed a term of the account that is subject to 1026.6(b) or 1026.9(c)(2). A consumer uses an account by obtaining an extension of credit after receiving the account-opening disclosures, such as by making a purchase or obtaining an advance. Whether the card issuer provides the consumer with a new credit card; B. i. When few of the facts and circumstances listed below are present, the substitution or replacement likely constitutes a change in the terms of an existing account for which 1026.9(c)(2) disclosures are appropriate. The bank recently appraised the home at $410,000. (ii) The creditor does not treat as late for any purpose a required minimum periodic payment received by the creditor within 14 days after mailing or delivery of the periodic statement. See 1026.5(b)(1)(iv)(A). Mailing or delivery of periodic statements. Periodic statements not required. Making statements about minority groups moving into a neighborhood in order to persuade existing owners to sell is. If a disclosure becomes inaccurate because of an event that occurs after the creditor mails or delivers the disclosures, the resulting inaccuracy is not a violation of this part, although new disclosures may be required under 1026.9(c). (d) Multiple creditors; multiple consumers. 1026.46 Special disclosure requirements for private education loans. Which action does NOT terminate a single-agent brokerage relationship with the seller? If the creditor opens an account for the consumer, the creditor would comply with the timing rules of this section by providing the consumer with the annual percentage rate (along with the fees and other required disclosures) that would apply to the balance transfer in time for the consumer to contact the creditor and withdraw the request. The following examples illustrate these rules: i. 1. ii. Which legal procedure is used to determine a fair price in an eminent domain action? 4. Same facts as in paragraph i above. Applicability of 1026.5(b)(2)(ii)(B)(1). 1026.26 Use of annual percentage rate in oral disclosures. The trademarks MLS, Multiple Listing Service and the associated logos are owned by CREA and identify the quality of services provided by real estate professionals who are members of CREA. 1026.19 Certain mortgage and variable-rate transactions. What is the property's net operating income? Which type of depreciation is associated with inefficient architectural design? Mold disclosure is common, as are radon and asbestos disclosures. Disclosure responsibilities are not satisfied by giving disclosures to only a surety or guarantor for a principal obligor or to an authorized user. Any person or group of persons occupying a separate housing space is defined by the U.S. Census Bureau as a, The interest on an assumed mortgage is entered on the closing statement as a. debit to the seller and a credit to the buyer. ii. In Maryland, sellers have a choice between giving a standard property disclosure statement or selling the home with a disclaimer on the condition of the home essentially selling the home as-is. Instituting collection proceedings. How Accurate Is My Zestimate, and Can I Influence It? 1. (iii) Certain account-opening disclosures must be provided in a tabular format in accordance with the requirements of 1026.6(b)(1). If the consumer wishes to pick up a statement, the statement must be made available in accordance with 1026.5(b)(2)(ii). For example, if the term total finance charge is used, only finance charge should be emphasized. Termination of draw privileges. (iii) If disclosures are required to be presented in a tabular format pursuant to paragraph (a)(3) of this section, the term penalty APR shall be used, as applicable. What type of lease arrangement requires the tenant to pay a fixed rent amount plus property expenses such as property taxes and hazard insurance? For example, when the terms appear as part of the explanations required under 1026.6(a)(1)(iii) and (a)(1)(iv), they may be equally conspicuous as the disclosures required under 1026.6(a)(1)(ii) and 1026.7(a)(7). For example, if an address is received 22 days before the end of the June cycle, the creditor must send the periodic statement for the June cycle. 1026.32 Requirements for high-cost mortgages. A periodic statement need not be sent for an account if the creditor deems it uncollectible, if delinquency collection proceedings have been instituted, if the creditor has charged off the account in accordance with loan-loss provisions and will not charge any additional fees or interest on the account, or if furnishing the statement would violate Federal law. Disclosures shall reflect the terms of the legal obligation between the parties. (Charges imposed as part of an open-end (not home-secured plan) that are not specified under 1026.6(b)(2) may alternatively be disclosed in electronic form; see the commentary to 1026.5(a)(1)(ii)(A).) When disclosures must be furnished before the first transaction, account-opening disclosures must be delivered before the consumer becomes obligated on the plan. (See the commentary to 1026.17 on converting open-end credit to closed-end credit.). There are two times during the listing and selling process when it may be appropriate to provide disclosures, before listing your home or after accepting an offer. If the consumer chooses to reject the financing plan, creditors comply with the requirements of this paragraph by permitting the consumer to pay for the goods with another reasonable form of payment acceptable to the merchant and keep the goods although the creditor cannot require the consumer to do so. One of the best ways to avoid disclosure issues is to use an experienced real estate agent. Which statement best describes the real estate term "follow up"? Consent to transition to transaction broker notice. Furthermore, 1026.5(b)(2)(ii)(B)(1)(ii) requires the creditor to have reasonable procedures designed to ensure that the creditor does not impose finance charges as a result of the loss of the grace period if a $500 payment is received on or before May 25. Inheritance Situation. 1026.41 Periodic statements for residential mortgage loans. A purchaser has ten days after receiving the disclosures to cancel the purchase agreement, unless the disclosures (c) Basis of disclosures and use of estimates. 1. 2. Balance transfers. This is to protect buyers by ensuring they aren't hit with a surprise problem after purchasing the home. Assume that the billing cycles for an account begin on the first day of the month and end on the last day of the month and that the payment due date for the account is the twenty-fifth of the month. Use of inserts. If a consumer has paid or promised to pay a membership fee including an application fee excludable from the finance charge under 1026.4(c)(1) before receiving account-opening disclosures, the consumer may, after receiving the disclosures, reject the plan and not be obligated for the membership fee, application fee, or any other fee or charge. (vii) Certain disclosures provided in a change-in-terms notice must be provided in a tabular format in accordance with the requirements of 1026.9(c)(2)(iv)(D). (iv) Certain disclosures provided on periodic statements must be grouped together in accordance with the requirements of 1026.7(b)(6) and (b)(13). Which statement is FALSE regarding homeowners association disclosure requirements? Who Inherits Your Property. Deferred interest and similar promotional programs. Pursuant to MCL 559.184a, the disclosure statement is required to include all of the following: (i) An explanation of the association of co-owners' possible liability pursuant to section 58. A card issuer that complies with 1026.5(b)(2)(ii)(A) as discussed above with respect to a charge card account has also complied with 1026.5(b)(2)(ii)(B)(2). A creditor that solicits the transfer by a consumer of outstanding balances from an existing account to a new open-end plan must furnish the disclosures required by 1026.6 so that the consumer has an opportunity, after receiving the disclosures, to contact the creditor before the balance is transferred and decline the transfer. 1026.33 Requirements for reverse mortgages. What type of listing is this? 1026.14 Determination of annual percentage rate. ii. Section 1026.5(b)(2)(ii)(B)(1) does not apply to charged-off accounts where full payment of the entire account balance is due immediately because such accounts do not provide a grace period. Here are a few examples, but again, be sure to check your own state laws: Disclosure laws are designed to protect buyers from purchasing a home with serious flaws and to protect sellers from future legal ramifications. Talk to an attorney or real estate agent about how to avoid negative outcomes in the disclosure process. Using the account. 6 Dealer is defined in Regulation X to mean a seller, contractor, or supplier of goods or services. A creditor may collect an application fee excludable from the finance charge under 1026.4(c)(1) before providing account-opening disclosures. See 1026.60(b)(2) and related commentary for guidance on fees for issuance or availability of a credit or charge card. Assume that, for a credit card account under an open-end (not home-secured) consumer credit plan, a periodic statement mailed on April 4 states that a required minimum periodic payment of $50 is due on April 25. Your state real estate association or board may have documents, often in checklist form, that list the disclosures required in your state.
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