UACES Facebook New rule offers home buyers three days to review the fine print
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New rule offers home buyers three days to review the fine print

By Laura Connerly
The Cooperative Extension Service
U of A System Division of Agriculture


Fast facts:

  • The Know Before You Owe rule became effective Aug.
  • New forms are designed for easier understanding

(264 words)

LITTLE ROCK – People taking out mortgages to buy a home are now entitled to three days to review the forms before signing anything. The provisions commonly called as the Know Before You Owe rule went into effect Aug. 1.

“Mortgages are complex transactions that may include risky features,” said Laura Connerly, assistant professor of family and consumer economics at the University of Arkansas System Division of Agriculture. “The new loan estimate and closing disclosure forms are designed to be easier to use and understand.”

For anyone buying a home, here’s how to benefit from the Know Before You Owe rule:

  • Clear language will help consumers understand complicated mortgage loan and real estate transactions.
  • Critical information such as the interest rate, monthly payments, and the total closing costs will be highlighted on the first page. This will make it easier to compare costs.
  • Information about the costs of taxes and insurance and how the interest rate and payments may change in the future will be provided.
  • Warnings about features you may want to avoid, like penalties for paying off the loan early or increases to the mortgage loan balance even if payments are made on time.
  • Reliable cost estimates for services required to close a mortgage loan, for example, appraisal or pest inspection fees.
  • The closing disclosure must be received at least three business days before closing. This additional time will allow a buyer to compare the final terms and ask questions before arriving at the closing table.

More information about the new rules is available from the Consumer Financial Protection Bureau at

The University of Arkansas System Division of Agriculture offers all its Extension and Research programs and services without regard to race, color, sex, gender identity, sexual orientation, national origin, religion, age, disability, marital or veteran status, genetic information, or any other legally protected status, and is an Affirmative Action/Equal Opportunity Employer.   



Media Contact: Mary Hightower
Dir. of Communication Services
U of A Division of Agriculture
Cooperative Extension Service
(501) 671-2126

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