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Q: What is a TRUTH-IN-LENDING DISCLOSURE STATEMENT and why do I receive it?

A:  Your Disclosure Statement contains information which Federal law requires us to provide to you. The purpose of the statement is to disclose information about your loan and to assist you in shopping for credit.



A:  The Annual Percentage Rate, or APR, is the cost of your credit expressed in terms of an annual rate. Because you may be paying "points" and other closing costs, the APR disclosed will in most cases be higher than the interest rate on your loan. The APR can be used to provide a method for comparing the cost of credit for different loan programs.



A:  The Amount Financed is your mortgage amount minus prepaid finance charges. Prepaid finance charges include items such as loan origination fees, commitment fees (points), interest adjustments, and initial mortgage insurance premiums (if applicable). The Amount Financed represents a net figure used to allow you to accurately assess the amount of credit actually provided.

Does this mean I will get a lower mortgage than I applied for?

No. If your loan is approved in the amount for which you applied, then this amount will be provided toward your home purchase or refinance at closing. 


Q: Why is the ANNUAL PERCENTAGE RATE different from the interest rate for which I applied? Why is the AMOUNT FINANCED different?

A:  The Amount Financed is lower than the amount you applied for because it represents a net figure. If someone applies for a mortgage of $150,000 and the prepaid finance charges total $4,000, the amount financed would be shown as $146,000 or $150,000 minus $4,000. The APR is computed from this lower figure, based on what your proposed payments would be. In a $150,000 loan with $4,000 in prepaid finance charges, and an interest rate of 5.00%, the payments would be $805.23 (principal and interest) on a loan with a thirty-year term. Since the APR is based on the net amount financed, rather than on the actual mortgage amount, and since the payment amount remains the same, the APR is higher than the interest rate. It would be 5.31%. If this applicant’s loan were approved he would still receive a $150,000 loan for thirty years  @ 5.00% with monthly payments of $829.65 (principal and interest).


Q: How will my payments be affected by the DISCLOSURE STATEMENT?

A:  The Disclosure Statement has no effect on actual payments and only discloses your estimated payments. The interest rate determines what your actual monthly principal and interest payment will be.


Q: What is the FINANCE CHARGE?

A:  The Finance Charge is the cost of credit over the life of the loan. It is the total amount of interest you will pay if you make the minimum payments over the life of the loan (calculated at your interest rate), plus prepaid finance charges, plus the total amount of mortgage insurance premiums (if applicable) charged over the life of the loan. This figure is estimated on the initial disclosure statement. If your loan is approved, at closing you will receive a final disclosure statement reflecting the actual terms of your loan.



A:  This figure indicates the total amount you will have paid, including the Amount Financed and Finance Charges, if you make the minimum required principal and interest payments for the entire term of the loan. This figure is estimated on the initial Disclosure Statement and is estimated in any adjustable rate transaction.

My statement says that if I pay the loan off early, I will not be entitled to a refund of part of the finance charge. What does this mean?

This means that you will be charged interest for the period of time during which you used the money loaned to you. The prepaid finance charges you paid in connection with your loan are not refundable. Neither is any interest which has already been paid. If you pay the loan off early, you should not have to pay the full amount of the "finance charges" shown on the disclosure. This charge represents an estimate of the full amount the loan would cost you if the minimum required payments were made each month throughout the life of the loan.


Q: My statement says that if I pay off early I may be entitled to a refund of part of the finance charge. What does this mean?

A:  Certain prepaid finance charges you paid in connection with your loan may be refundable if you pay off early, but only in the amount of any unused portion. If you pay mortgage insurance premiums, or if funds are placed in a buy-down or First Choice account, then a portion of these amounts may be refunded if you pay off early.


Q: Why must I sign the DISCLOSURE STATEMENT?

A:  Lenders are required by law to provide the information on this statement to you in a timely manner. Your signature merely indicates that you have received this information, and does not obligate either you or Global Unity Mortgage in any way.




We hope that these have addressed any questions that you may have had. However, every loan scenario is not the same. If there remain any unanswered questions or concerns, please feel free to contact Global Unity Mortgage and our representatives will be more than happy to address those items to your satisfaction. Remember, at Global Unity Mortgage…your business means the world to us!!





Global Unity Mortgage
71-1 Wilson Lane, Vernon, CT  06066
Office:  (860) 872-9479
Copyright © 2018 Global Unity Mortgage
A subsidiary of Global Unity Trust LLC.
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