text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``Mortgage Disclosure Simplification 
  Act of 2007''.
  
  SEC. 2. REQUIRED DISCLOSURES REGARDING LOAN TERMS.
  
      The Real Estate Settlement Procedures Act of 1974 is amended by 
  inserting after section 4 (12 U.S.C. 2603) the following new section:
  
  ``SEC. 4A. REQUIRED DISCLOSURES REGARDING LOAN TERMS.
  
      ``(a) Development.--The Secretary, in consultation with appropriate 
  Federal lending regulation agencies, shall develop and prescribe 
  standard written forms under subsection (c) for statement of the 
  essential terms of a federally related mortgage loan.
      ``(b) Requirement To Use.-- The Secretary shall require that--
              ``(1) the forms developed pursuant to subsection (a) be 
          used in all transactions in the United States that involve 
          federally related mortgage loans; and
              ``(2) that in any such a transaction--
                      ``(A) the form under subsection (c)(1) shall be 
                  appropriately and accurately completed by the lender or 
                  mortgage broker, or both; and
                      ``(B) the completed form under subsection (c)(1) 
                  shall be provided to the borrower, together with the 
                  form under subsection (c)(2), not later than three days 
                  after the application for the federally related 
                  mortgage loan is made.
      ``(c) Contents.--With respect to a federally related mortgage loan, 
  the standard written forms required under this subsection are as 
  follows:
              ``(1) Statement of loan terms.--A single page, written 
          disclosure regarding the federally related mortgage loan that, 
          when completed by the lender or mortgage broker, or both, sets 
          forth, in accordance with such requirements as the Secretary 
          shall by regulation establish--
                      ``(A) a best possible estimate of--
                              ``(i) the total loan amount under the 
                          federally related mortgage loan;
                              ``(ii) the loan-to-value ratio for the 
                          loan;
                              ``(iii) the final maturity date for the 
                          loan;
                              ``(iv) the amount and due date for any 
                          balloon payment under the loan;
                              ``(v) the amount of any prepayment fee to 
                          be charged if the loan is paid in full before 
                          the final maturity date for the loan;
                              ``(vi) the initial interest rate under the 
                          loan expressed as an annual percentage rate, 
                          and the amount of the monthly payment due under 
                          such rate;
                              ``(vii) the duration during which such 
                          initial interest rate will be charged;
                              ``(viii) the fully indexed rate of interest 
                          under the loan expressed as an annual 
                          percentage rate and the amount of the monthly 
                          payment due under such rate;
                              ``(ix) the maximum possible rate of 
                          interest under the loan expressed as an annual 
                          percentage rate and the amount of the monthly 
                          payment due under such rate;
                              ``(x) the monthly household income of the 
                          borrower upon which the loan is based;
                              ``(xi) the amount of initial monthly 
                          payment due under the loan, and the amount of 
                          such initial monthly payment plus monthly 
                          amounts due for taxes and insurance on the 
                          property for which the loan is made, both 
                          expressed as a percentage of the monthly 
                          household income of the borrower;
                              ``(xii) the amount of the fully indexed 
                          monthly payment due under the loan, and the 
                          amount of such fully indexed monthly payment 
                          plus monthly amounts due for taxes and 
                          insurance on the property for which the loan is 
                          made, both expressed as a percentage of the 
                          monthly household income of the borrower;
                              ``(xiii) the aggregate amount of settlement 
                          charges for all settlement services provided in 
                          connection with the loan, the amount of such 
                          charges that are included in the loan amount 
                          and the amount of such charges the borrower 
                          must pay at closing, the aggregate amount of 
                          lender's fees connection with the loan, and the 
                          aggregate amount of other fees or required 
                          payments in connection with the loan; and
                              ``(xiv) the aggregate amount of fees paid 
                          to the mortgage broker in connection with the 
                          loan, the amount of such fees paid directly by 
                          the borrower, and any additional amount 
                          received by the broker from the lender based on 
                          the interest rate of the loan (commonly 
                          referred to as a yield spread premium);
                      ``(B) a name, telephone number, and electronic mail 
                  address that may be used by the borrower to obtain 
                  information regarding the loan; and
                      ``(C) a prominent statement that the amounts to be 
                  provided by the lender or mortgage broker, or both, 
                  under the federally related mortgage loan shall be 
                  subject to final underwriting of the loan.
              ``(2) Statement of definitions and explanations.--A two-
          page written disclosure that sets forth, in accordance with 
          such requirements as the Secretary shall, by regulation, 
          establish, basic easy-to-understand definitions or 
          explanations, of terms relating to residential mortgage loans, 
          including each of the following terms: appraised value, types 
          of loans, initial interest rate, fully indexed rate of 
          interest, maximum possible rate of interest, monthly household 
          income, monthly loan payment including taxes and insurance, 
          fully indexed housing expense ratio, prepayment fee, balloon 
          payment, payment option loan, points, closing costs, settlement 
          services, settlement charges, lender's fees, and mortgage 
          broker.
      ``(d) Savings Clause.--Notwithstanding disclosure pursuant to 
  subsection (c)(1)(A) of best possible estimates of the information 
  required under such subsection with respect to a federally related 
  mortgage loan, the amounts to be provided by the lender or mortgage 
  broker, or both, under the loan shall be subject to final underwriting 
  of the loan.''.
target: Mortgage Disclosure Simplification Act of 2007 - Amends the Real Estate Settlement Procedures Act of 1974 to instruct the Secretary of Housing and Urban Development to develop and prescribe standard written forms stating the essential terms of a federally related mortgage loan, which lenders or mortgage brokers shall provide to prospective mortgagors.
  
  Requires such disclosures to include: (1) a statement of terms regarding a federally related mortgage loan; and (2) a statement of basic easy-to-understand definitions or explanations of such terms.
feat_title: To amend the Real Estate Settlement Procedures Act of 1974 to require the submission to each borrower under a federally related mortgage loan of a one-page description of the essential terms of the loan.