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Residential Real Estate Mortgage Loan Commitment Letters

October, 2018

The Vermont Department of Financial Regulation (DFR) now requires mortgage lenders to issue commitment letters in connection with all residential mortgage loans (Regulation B-2018-02, revising the content and timing requirements of residential mortgage loan commitment letters). The new requirements are effective October 1, 2018.  Regulation B-2018-02 supersedes and replaces Regulation B-98-1. 

The revised regulation establishes the form of the commitment letter and outlines the general requirements for the content contained in the commitment letter. If a lender is required to issue a closing disclosure under Federal Regulation Z, the lender has the option to issue a short form commitment letter. (Regulation B-2018-02, Section 4, Subdivision B).  In the case of a reverse mortgage loan the content of the commitment letter is also outlined (Regulation B-2018-02, Section 4, Subdivision C).  All commitment letters must be delivered to the borrower no less than three business days prior to the closing, unless an exception applies. (Regulation B-2018-02, Section 5). 

The full text of the regulation can be found at the DFR website

For more information on this topic contact Alexandra Edelman at aedelman@primmer.com or 802.864.0880.