Navigating the complexities of securing a mortgage guaranteed by the Department of Veterans Affairs (VA) involves understanding many critical documents, one of which is the Discount Disclosure Statement. This essential form plays a pivotal role in elucidating the details surrounding the interest rate and discount points that a borrower may incur on a VA-guaranteed mortgage. It's important to note that the VA does not dictate the interest rates or the bounds for the discount points on these loans, leaving room for negotiation between the borrower and the lender, and potentially the seller. Highlighting the negotiability of these terms, including the duration which lenders will honor the loan terms, the form underscores the possibility of entering into a lock-in agreement. Moreover, any adjustment to the interest rate and discount points prior to closing, especially an increase of more than 1 percent in the interest rate, necessitates a re-underwriting process. This crucial step can impact the borrower's qualification status and the eventual closing of the loan, emphasizing the importance of a well-informed borrower in these transactions. The form encapsulates a commitment to ensuring borrowers fully comprehend all aspects of their loan agreement, from negotiations to closing, signifying its key role in fostering transparency and understanding in VA-guaranteed mortgage processes.
| Question | Answer |
|---|---|
| Form Name | Discount Disclosure Statement |
| Form Length | 1 pages |
| Fillable? | No |
| Fillable fields | 0 |
| Avg. time to fill out | 15 sec |
| Other names | va insterest rate amd discount disclosure, va interest rate and discount disclosure statement, va form interest rate and discount disclosure, interest rate and discount disclosure |
INTEREST RATE AND DISCOUNT
DISCLOSURE STATEMENT
1.This statement regarding the interest rate and discount points that you may pay on a mortgage guaranteed by VA (Department of Veterans Affairs) must be delivered to you prior to execution of the borrower’s certification on the HUD/VA Addendum to the Uniform Residential Loan Application.
2.VA does not establish the interest rate for mortgage loans to be guaranteed or set either a maximum or minimum on the interest rate or on discount points that may be paid by you. This means that you may pay such interest rate and discount points as you and the lender agree upon. The seller may also pay the discount points, or a portion thereof, if you and the seller agree to such an arrangement.
3.It is important for you to understand that the interest rate and discount points and the length of time the lender will honor the loan terms are all freely negotiable with the lender. Lenders may agree to offer the loan terms for a definite period of time (i.e., 30, 60, or 90 days), or may refuse to do so. This arrangement is commonly referred to as a
4.The terms of your agreement with the lender will determine the degree, if any, that the interest rate and discount points may change before closing. An increase of more than 1 percent in the interest rate requires
IT IS OUR RESPONSIBILITY TO ASSURE THAT
YOU UNDERSTAND THE TRANSACTION
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