Beautiful New Home Only $1500 Per Month-Opps Did I Say That?

By
Real Estate Broker with CJ Realty Group, Inc.
http://actvra.in/gCq

House with Interest RatesYou've just listed a new home and you want buyer's to know how affordable the monthly payment will be.  You pull out your handy dandy calculator and do an estimate of the monthly payment.  You are excited to figure out that the monthly payment would be less than the average rent in your area.  You quickly add a line to your advertising that says "Own this home for only $1500 per month." 

Did you know you may have just violated the Truth and Lending Laws and Regulation Z?  What seems like a very simple idea could land you in very hot water.  Regulation Z in simple terms says if you use any "trigger" term such as an amount of a down payment, monthly payment, number of payments or an interest rate you now must disclose all of the following:

The amount of the down payment or percentage of down payment
Term of repayment
APR and if it will change during the term of the loan then you must include that information as well



Violation of the Truth in Lending laws aren't cheap.  Besides requiring you to stop advertising a court could require:

Monetary fines of up to $5000
Criminal prosecution and up to 1 year of jail time
Civil penalities between $100 to $1000
Truth and Lending Law Penalties
Court Costs
Attorney's Fees

What seemed like such a great idea to bring attention to the affordability of buying a new home suddenly has more significance than you thought.   If you are considering advertising a monthly payment on your latest listing call your favorite lender and ask them to do a full rate sheet for you.  I don't know about you but I don't think stripes are very flattering except on a zebra.



 

 

 

 



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                                   Real People*Real Lives*Real Estate

If you are interested in learning more about the Northern Virginia Real Estate market including Alexandria, Arlington, Fairfax and Prince William Counties give Cindy Jones and CJ Realty Group,  a call at 703-346-2213. 

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Check out www.varealestatetalk.com and www.cjrealtygroup.com for more information.
CJ Realty Group Woodbridge VA 
Real People*Real Life*Real Estate

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Re-Bloggged 3 times:

Re-Blogged By Re-Blogged At
  1. Don MacLean 08/12/2011 11:48 AM
  2. Bridget McGee 08/12/2011 12:28 PM
  3. Steven Cook 08/12/2011 02:46 PM
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Topic:
Lending / Financial
Groups:
Addicted to Active Rain
BananaTude
Bartender, Make it a Double
RE/MAX Active Rain Bloggers
"Whacked"!!!
Tags:
truth in lending laws
regulation z
real estate advertising
blogging tips and tricks

Comments 56 New Comment

Ambassador
1,770,506
Cindy Jones
Pentagon, Fort Belvoir & Quantico Real Estate News
CJ Realty Group, Inc.

Melissa-it's amazing how quickly the things we learn go out the window when we are advertising a new property.

August 13, 2011 08:25 AM
Ambassador
1,770,506
Cindy Jones
Pentagon, Fort Belvoir & Quantico Real Estate News
CJ Realty Group, Inc.

Christine-from what I recall anytime you mention a downpayment then you must go through the full disclosure.  I'm not sure if I would even say Zero down. 

August 13, 2011 08:26 AM
Ambassador
1,770,506
Cindy Jones
Pentagon, Fort Belvoir & Quantico Real Estate News
CJ Realty Group, Inc.

Gretchen-I can run a quick mortgage payment estimate but I'm not going to put it in print on a flyer.

August 13, 2011 08:27 AM
Ambassador
1,651,915
Barbara-Jo Roberts Berberi
Palm Harbor Florida Residential Real Estate
Charles Rutenberg Realty

Cindy - great reminder for agents to be careful what they write in their excitement! Yes, that could be a real nail in the coffin!

August 14, 2011 08:43 AM
Ambassador
1,770,506
Cindy Jones
Pentagon, Fort Belvoir & Quantico Real Estate News
CJ Realty Group, Inc.

Barbara Jo-just read today a blog by an agent who mentioned rates.  I'm just going to follow what our association attorney suggested and stay away from quoting rates and talk in general terms.

August 15, 2011 08:27 AM
Ambassador
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Cindy Jones

Pentagon, Fort Belvoir & Quantico Real Estate News
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