(a) Lender to provide special information booklet. Subject to the
exceptions set forth in this paragraph, the lender shall provide a
copy of the special information booklet to a person from whom the
lender receives, or for whom the lender prepares, a written application
for a federally related mortgage loan. When two or more persons apply
together for a loan, the lender is in compliance if the lender provides
a copy of the booklet to one of the persons applying.
(1) The lender shall provide the special
information booklet by delivering it or placing it in the mail to
the applicant not later than three business days (as that term is
defined in section 1024.2) after the application is received or prepared.
However, if the lender denies the borrower’s application for credit
before the end of the three-business- day period, then the lender
need not provide the booklet to the borrower. If a borrower uses a
mortgage broker, the mortgage broker shall distribute the special
information booklet and the lender need not do so. The intent of this
provision is that the applicant receive the special information booklet
at the earliest possible date.
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(2) In the case of a federally related
mortgage loan involving an open-ended credit plan, as defined in Regulation
Z, 12 CFR 1026.2(a)(20), a lender or mortgage broker that provides
the borrower with a copy of the brochure entitled “When Your Home
is On the Line: What You Should Know About Home Equity Lines of Credit”,
or any successor brochure issued by the Bureau, is deemed to be in
compliance with this section.
(3) In the categories of transactions set
forth at the end of this paragraph, the lender or mortgage broker
does not have to provide the booklet to the borrower. Under the authority
of section 19(a) of RESPA (12 U.S.C. 2617(a)), the Bureau may issue
a revised or separate special information booklet that deals with
these transactions, or the Bureau may choose to endorse the forms
or booklets of other Federal agencies. In such an event, the requirements
for delivery by lenders and the availability of the booklet or alternate
materials for these transactions will be set forth in a Notice in
the Federal Register. This paragraph shall apply to the following
transactions:
(i) Refinancing transactions;
(ii) Closed-end loans, as
defined in 12 CFR 1026.2(a)(10) of Regulation Z, when the lender takes
a subordinate lien;
(iii) Reverse mortgages; and
(iv) Any other federally related mortgage
loan whose purpose is not the purchase of a 1- to 4-family residential
property.
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(b) Revision. The Bureau may from time to time
revise the special information booklet, publishing a notice in the Federal Register.
(c) Reproduction. The special information booklet may be reproduced
in any form, provided that no change is made other than as provided
under paragraph (d) of this section. The special information booklet
may not be made a part of a larger document for purposes of distribution
under RESPA and this section. Any color, size and quality of paper,
type of print, and method of reproduction may be used so long as the
booklet is clearly legible.
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(d) Permissible changes.
(1) No changes to, deletions from, or additions to the special information
booklet currently prescribed by the Bureau shall be made other than
the permissible changes specified in paragraphs (d)(2) and (3) of
this section or changes as otherwise approved in writing by the Bureau
in accordance with the procedures described in this paragraph (d).
A request to the Bureau for approval of any changes other than the
permissible changes specified in paragraphs (d)(2) and (3) of this section
shall be submitted in writing to the address indicated in the definition
of Public Guidance Documents in section 1024.2, stating the
reasons why the applicant believes such changes, deletions, or additions
are necessary.
(2) The cover of
the booklet may be in any form and may contain any drawings, pictures,
or artwork, provided that the words “settlement costs” are used in
the title. Names, addresses and telephone numbers of the lender or
others and similar information may appear on the cover, but no discussion
of the matters covered in the booklet shall appear on the cover.
(3) The special information booklet
may be translated into languages other than English.
