Builders Inhouse Lender Question (mortgage companies, financial, ARM, contract)

[TryingToEscapeTheMadness]

What, legally, can inhouse mortgage companies share with builders. More specifically is we are building a home and the builder has a mortgage arm and we apply for a mortgage with their sister company, what information can they legally share with the actually builder. Same parent company, different divisions.

[SmartMoney]

Originally Posted by TryingToEscapeTheMadness

What, legally, can inhouse mortgage companies share with builders. More specifically is we are building a home and the builder has a mortgage arm and we apply for a mortgage with their sister company, what information can they legally share with the actually builder. Same parent company, different divisions.

Read your contract closely. Read your application paperwork closely. Most affiliations have an agreement to share your financial information between the two. If you cannot find it, ask directly. It will most likely be in your purchase contract where you agree to use their lender.

[TryingToEscapeTheMadness]

Thanks...good idea. I thought there might be federal regulations regarding this, RESPA or something.

[SmartMoney]

Originally Posted by TryingToEscapeTheMadness

Thanks...good idea. I thought there might be federal regulations regarding this, RESPA or something.

The sharing of information would not fall under RESPA, but The Privacy Act. I have seen contracts that specifically spell out the mortgage company can share financial information with the mortgage company. Is voiding your rights under The Privacy Act legal? Not sure, but I imagine like anything else, it's just a matter of time to find it's way in the courts.

Are the extras worth the sacrifice of privacy? I can see some situations where it would be detrimental. But I can also see the flip side too.