Up Front Mortgage Lender

Definition of "Up front Mortgage Lender"

Norcross & Partners real estate agent

Written by

Norcross & Partnerselite badge icon

William Raveis Real Estate - Wellesley

A lender offering loans on the Internet who provides mortgage shoppers with the information they need to make an informed decision before applying for a mortgage and guarantees them fair treatment during the period after they apply through to closing. The specific requirements, and how they meet the needs of shoppers, are as follows: Requirement 1:A UML provides quick access to the market niches it prices on-line. Shoppers need a quick way to determine whether a particular lender prices the niche in which that shopper falls. If not, the shopper can go elsewhere without wasting time. If the shopper's niche is priced on-line: The shopper can make valid comparisons of one UML's prices against those of another, prior to paying any fees and prior to filling out an application; After selecting the lender and applying for the desired loan, the applicant is not exposed to a future price change based on information that the lender claims not to have had at the time of the original quote; The applicant who elects to move to a different niche, say to a 15-year from a 30, or to pay more points to reduce the rate, can check online to ensure that the new niche has been correctly priced; The applicant who elects to float rather than lock can monitor the price as it is reset daily with the market, and therefore will not be overcharged on the lock day. UMLs comply with this requirement by filling out a table on their Web site called Market Niches Priced On-Line. Requirement 2: A UML includes its fixed-dollar fees, including credit and appraisal charges, in its price and guarantees them to closing. This assures borrowers that new fees won't be added or existing ones increased after they have committed themselves to working with the selected lender. Requirement 3: A UML provides a clear explanation of its lock requirements: Mortgage shoppers need to know when they have the discretion to lock. The explanation should include any required payments, processes that must be completed, how expired locks are handled, and whether the borrower is committed as well as the UML. Requirement 4: A UML discloses all the information about its ARM's needed by shoppers to make intelligent decisions. . Loan officers selling ARM's stress one or another feature, usually the index, and leave the remainder of the ARM's features in the dark. Shoppers need information on potential ARM performance what will happen to the interest rate and mortgage payment under assumptions about future interest rates that make sense to the shopper. UML's can comply with this rule in two ways. One way is to offer schedules of monthly payment and interest rate under no-change and worst-case scenarios. The first assumes that the most recent value of the index remains unchanged through the life of the loan, while the second assumes that the ARM rate increases by the maximum amount allowed in the contract. Requirement 5: A UML informs borrowers if its loan officers are compensated in a way that gives them a financial incentive to overcharge the borrower.


Need help as a:

I'm interested to:


I work in:

Reach out to the local professionals for help
I agree to receive FREE real estate advice.

Agents, get listed in your area. Sign up Now!

Here's what you'll get:

1. Full zipcodes coverage for the city of your choice for 3 months

2. The ability to reach a wider audience

3. No annual contract and no hidden fees

4. Live customer support/No robo calls

$75 - Any City - 3 Months Coverage
loader gif

Please wait ...

I agree to receive FREE real estate advice
I agree with Terms & Conditions and Section 5-5.9.

image of a real estate dictionary page

Have a question or comment?

We're here to help.

*** Your email address will remain confidential.


Popular Mortgage Terms

Trying to find the best deal on a mortgage. It isn't easy to do right, as a summary of the major steps involved will demonstrate. Step 1: Decide if you are a potential shopper. Step 2: ...

A borrower with the best credit rating, deserving of the lowest prices that lenders offer. ...

The period used to calculate the monthly mortgage payment. The term is usually but not always the same as the maturity, which is the period over which the loan balance must be paid in ...

A very large increase in the payment on an ARM that may surprise the borrower. The term is also used to refer to a large difference between the rent being paid by a first-time home buyer ...

An option exercised by the borrower, at the time of the loan application or later, to 'lock in' the rates and points prevailing in the market at that time. When lenders 'lock/' they ...

A government-owned or -affiliated lender that makes home loans directly to consumers. With minor exceptions, government in the U.S. has never loaned directly to consumers, but housing banks ...

A fee that some lenders charge to accept an application. It may or may not cover other costs such as a property appraisal or credit report, and it may or may not be refundable if the lender ...

Prices that assume a more or less standardized set of transaction characteristics that generally command the lowest prices. Generic prices are distinguished from transaction specific ...

The monthly mortgage payment which, if maintained unchanged through the remaining life of the loan at the then-existing interest rate, will pay off the loan at term. ...

Popular Mortgage Questions