Mortgage Compliance Updates
DocuTech works hard to keep your mortgage closing documents up-to-date with the latest Federal and State changes and investor updates, as well as expanding our mortgage document library. Find out what mortgage document updates were made:
Mortgage Document Updates
- February 2010
- January 2010
- December 2009
- November 2009
- October 2009
- September 2009
- August 2009
- July 2009
- June 2009
- May 2009
- April 2009
New Model Privacy Notices
On December 1, 2009 the federal agencies responsible for administering the Graham-Leach-Bliley Act (“GLBA”) and the Fair Credit Reporting Act (“FCRA”) issued revised regulations that financial institutions may use to meet the privacy notice requirements under the Acts. The focus of the revised regulation is on a new Model Form that institutions may use to describe their privacy policy to their customers. The regulation provides a safe harbor provision for institutions that use the model form exactly as written.
More...Mortgage Compliance - Be Good and Lucky
Can you afford to have pretty good data? Can you afford tolerable investor pricing variances? Can you afford to usually be compliant?
There’s an old saying that argues, “It’s better to be lucky than good.” While true in many instances, it shouldn’t be in your company’s vision statement! And you certainly shouldn’t put it into practice either. Why not be both good and lucky?
A Loan Closer's Nightmare
As a loan closer I was used to facing daily challenges that I relied on others to help out with. There are a handful of different variables that affect each and every day. One thing I do know is the value of available resources to get my job done. These resources are critical in making sure I complete my job. As I was contemplating different challenges, my mind came across 5 items I found critical as a loan closer.
More...Arkansas Disclosure and Certification Discontinued
Disclosure and Certification-Arkansas Rule 5010-2 (Cx12918) is no longer required due to recent changes to the Arkansas Fair Mortgage Lending Act. Previously the doc printed generically in all AR Closing packages. It will no longer print in any ConformX document packages.
More...VA Itemization of Origination Charge
Per VA Circular 26-10-01 (attached), loan applications taken on or after May 1, 2010 must either provide an origination statement itemizing the fees included in 801 or list each of the individual fees included in the 801 fee amount separately directly on the HUD-1. Lenders are encouraged to comply as soon as possible. A new Veterans Affairs Origination Statement Itemizing "Our Origination Charge" (Cx14692) has been created. It will print generically in all VA Closings for new RESPA loans.
More...RESPA 2010 - Good Faith Estimate 801 Fee
There is probably nothing associated with the new RESPA regulation that is causing mortgage originators more headaches than the disclosure of origination charges on the new Good Faith Estimate (“GFE”) and Uniform Settlement Statement (“HUD”). My experience has been that the disclosure of Yield Spread Premium (“YSP”) is the area that is causing the most difficulty and has been a boon for providers of pain relief medications.
More...DocuTech Provides Full Service in NetOxygen Cirrus
In the last two years, the mortgage lending industry has undergone dramatic changes to meet new regulatory requirements and customer expectations. As with any major change in an industry, this wide-sweeping event has created opportunities for companies entering the lending arena, but slow-moving “business as usual” tactics will not help companies take advantage of the opportunities. As a result, mortgage lenders are changing the way they do business by incorporating enhancements focused on internal efficiency and integrating third-party services into their processes. Using third-party services is like pulling into a full-service gas station.
More...FHA Announces Policy Changes - Jan 2010
On January 20, 2010, FHA announced several policy changes designed to strengthen its capital reserves. The changes are the latest in a series of changes designed to help FHA mitigate risk while fulfilling its mission to expand homeownership.
More...DocuTech Launches RESPA Resources Page
DocuTech has launched a new section to its compliance web page where users can find information that will help them comply with the new changes to RESPA. The resources found on this web page include...
More...HUD-1 Settlement Statement (Page 3)
The third page of the HUD-1/A Settlement Statement (“HUD”) contains the comparisons of fees disclosed on the GFE and the HUD and a restatement of the loan terms which were first disclosed on page one of the GFE. The most important sections on this page are those that deal with the new tolerance levels for fees.
More...Revised NY Pre-Application Disclosure
The NY Pre-Application Disclosure for Mortgage Bankers has been revised to include new required information on discount points.
More...SC Mortgage Loan Originator Unique Identifier Addendum
A new South Carolina Mortgage Loan Originator Addendum will print in all document packages.
More...FHA Mortgage Loan Correspondent Disclosure
A new FHA Mortgage Loan Correspondent Disclosure was added to ConformX document packages on January 1, 2010.
More...Update to FNMA 1003, Cx4193
The Uniform Residential Loan Application (FNMA Form 1003/FHLMC Form 65, Cx4193) has been updated to the latest version, required 01/01/2010.
More...FHA 1% Origination Cap Removed
On December 30, 2009 HUD published Mortgagee Letter 2009-53 which removes the 1% origination fee cap on FHA-insured loans.
More...Indiana Notice to Borrower
A new Indiana Notice to Borrower/Prospective Borrower prescribed by the Homeowner Protection Unit of the Office of the Attorney General has been added to all Indiana initial disclosure packages.
More...New RESPA Documents
A list of new and revised documents that will print in loan packages following January 1, 2010.
More...ConformX - Update to FNMA 1008
The Uniform Underwriting and Transmittal Summary (FNMA Form 1008/FHLMC Form 1077, Cx2901) has been updated to the latest version, required 01/01/2010.
More...Completing the New HUD-1 Settlement Statement
The new HUD-1 Settlement Statement (“HUD”) is designed to correlate closely to the new GFE, allowing borrowers to see how the estimate settlement costs disclosed on the GFE compare to the actual settlement costs charged and disclosed on the new HUD.
More...Using the Correct Disclosure Package
The fee amounts disclosed on the Good Faith Estimate and the corresponding fee amounts charged to the borrower at closing must be displayed side-by-side on page three of the new HUD-I Settlement Statement, effective with the new RESPA Rule. Each fee is placed into the proper tolerance category (Charges That Cannot Increase, Charges That in Total Cannot Increase More Than 10%, and Charges That Can Change) and it is important that the GFE column values accurately affect what was actually disclosed to the borrower initially.
More...Revised FHA Informed Consumer Choice Disclosure Notice
The FHA Informed Consumer Choice Disclosure Notice has been updated. The FHA Informed Consumer Choice Disclosure Notice (Cx41) prints in all FHA Initial Disclosure packages. HUD allows the original example terms to be replaced to better reflect current product offerings. The two examples (one for FHA and one for Conventional) have been updated.
More...RESPA Reform: GFE Page Two
The previous article in this series examined the first page of the Good Faith Estimate. It discussed new loan term disclosures that have been added to the GFE for the changes that are effective on January 1, 2010. This article will discuss page two of the new GFE.
More...Fast Food and Compliance
It makes sense to say that automation is one of the keys to compliance in mortgage lending, right? No matter what else is being said. No one is out there arguing that less technology is better. But ‘automation’ is one of those words that means different things to different people, and it’s important that mortgage lenders understand the term in its broadest sense, especially when it comes to compliance.
More...Higher Priced Mortgage Loans
On October 1, 2009 the Federal Reserve implemented a new rule designed to regulate the closed-end subprime mortgage market. The rule can be found in Regulation Z at 12 C.F.R. § 226.35. It is commonly referred to as Section 35 or the “higher-priced mortgage loan” rule.
More...Getting to Know the New Good Faith Estimate (Jan 2010)
On January 1, 2010 mortgage originators will be required to use a new Good Faith Estimate for all mortgage transactions subject to RESPA. The rule that the GFE must be delivered to the borrower not later than 3 business days after a lender receives an application has not changed.
More...Prepare Now for January 2010 RESPA Changes
The major changes under the new RESPA rules take effect on January 1, 2010. There is a revised Good Faith Estimate that is quite a departure from the old form. It gives the borrower a summary of the terms of the loan as well as the settlement costs.
More...Changes to Regulation Z - July 2009
On July 30, 2009 changes to Regulation Z, the implementing regulation for the Truth-in-Lending Act, will become effective. These changes alter the rules that lenders must follow during the application and disclosure process. This article will give you an overview of the important changes that are coming and give you the information you need to make sure that you are compliant with the new rules.
More...Stay Compliant with Broker ID Laws
An emerging trend in mortgage lending documentation state regulation is requiring the names and registration numbers of mortgage brokers or originators be included on security instruments and other loan documents. Massachusetts and North Carolina were the first states to have adopted such requirements, and Delaware has recently followed suit. Other states are watching to see how the regulations work and are considering similar legislation. While adherence to these new regulations and laws will necessitate small changes in the way mortgage originators do business, they will also help weed out those unscrupulous few who have led to the widespread mistrust of honest, hard-working mortgage professionals. Read the full article in Mortgage Originator to learn more about how to easily comply with Broker ID laws.
More...Electronic Disclosures - Sorting Out the Mess
Many mortgage professionals find the rules regarding early or initial disclosures to be complex, time-consuming and unreliable. For brokers in search of an easier way to disclose loan features and cost estimates to their clients, the answer may be going electronic. Delivering disclosures electronically offers many benefits over the traditional fax and mail systems.
More...Appraisal Integrity
The Home Valuation Code of Conduct (HVCC) is intended to improve the integrity of the appraisal process in the mortgage finance industry. The HVCC must be applied to all non-government mortgage loans originated on or after May 1, 2009 that will be delivered to either Fannie Mae or Freddie Mac. Lenders must rep and warrant that the appraisal report was obtained in a manner compliant with the Home Valuation Code of Conduct.
More...Legal and Mortgage Compliance Issues You Need to Know
Staying on top of law changes and new investor interpretations is critical because they are key elements to a lender’s survival in these tough economic times. Increased investor scrutiny is a major issue. Loan quality has replaced origination volume as a primary focus.
More...FHA Provides Guidance on New Mexico Security Instrument
April 15, 2009 - Mortgagee Letter 2009-13 provides guidance stating the FHA security instrument for New Mexico should be a Deed of Trust.
More...The Impact of Broker ID Laws
This past year has been one of the most active in recent history for government involvement in mortgage lending. The collapse of real estate and credit markets worldwide has led to a figurative “alphabet soup” of new and revised regulations and laws—HERA, TILA, RESPA, SAFE and TARP were all passed or revised in 2008.
More...Home Valuation Code of Conduct Effective
Lenders must represent and warrant that appraisals conducted in connection with single-family mortgage loans delivered to Fannie Mae and Freddie Mac, other than government-insured and -guaranteed loans, with application dates on or after May 1, 2009 conform to the Home Valuation Code of Conduct.
More...Countrywide/Bank of America Update
DocuTech has made several changes to its systems in accordance with the name change of Countrywide Bank, FSB to Bank of America, N.A.
More...HVCC Verification of Receipt of Appraisal Form
VCC Verification of Receipt of Appraisal Form. Although not required by the HVCC, there are many investors requiring a Home Valuation Code of Conduct form in all their conventional loan files.
More...Freddie Bulletin 2008-4: Multiple Subjects
Freddie Bulletin 2008-4: Multiple Subjects advised that effective January 1, 2009, loan instruments must contain taglines on each page.
More...The Future Is In Our Hands
Everyday the news in the mortgage industry gets more and more bleak. As property values have fallen, borrowers became delinquent and mortgages were foreclosed things have slowly snowballed to get us to the point where we are now. Many lenders have gone out of business, investment banks followed, we saw the conservatorship of Fannie and Freddie and now we are looking at a $700 billion dollar bailout of the financial system.
More...FHA Risk-Based Premiums Take a Break
When President Bush signed the Housing and Economic Recovery Act of 2008 (HERA) on July 30, 2008, the new FHA risk-based premiums (using a combination of credit bureau scores and loan-to-value ratio) were put out on the curb. The law prohibits HUD from taking any action to implement the risk-based premium program for 12 months beginning this October.
More...Changes to California Mortgage Loan Disclosure Statements
The California Department of Real Estate has revised the content of all three versions of the Mortgage Loan Disclosure Statement and has created informational sheets instructing real estate brokers on the proper use of each version.
More...The New HOEPA Rule - 2008
On July 14th, 2008, the Board of Governors of the Federal Reserve adopted its final "HOEPA Rule", amending its Truth in Lending Rules, Regulation Z.
In general the Board prohibited acts or practices in connection with mortgage loans that the Board finds to be unfair, deceptive, or designed to evade the provisions of HOEPA, and refinancing of mortgage loans that the Board finds to be associated with abusive lending practices, or that are otherwise not in the interest of the borrower.
Housing and Economic Recovery Act of 2008
Despite threats to veto, on July 30, 2008, President Bush signed the "Housing and Economic Recovery Act of 2008" (HERA), a bill that many have described as the most significant piece of housing legislation passed in the last thirty years.
More...Rebuilding After the National Mortgage Crisis
After Hurricane Katrina devastated part of Louisiana, killing hundreds of people and leaving thousands homeless, federal and state governments and many other groups and entities started working together to clean, rebuild and take necessary precautions to prevent another disaster.
Just like the plight in Louisiana, the national mortgage crisis was fatal for hundreds of lending companies, left thousands of people without jobs, hundreds of thousands without homes and the numbers continue to grow.
New Mortgage Legislation Effective July 1, 2008
The Fourth of July is a day that everyone looks forward to and is often referred to as the "Great American Holiday." For those in the compliance business it is a time to celebrate our independence or survival from the First of July. The First of July is commonly a day when regulatory changes passed by state legislatures become effective. This year we saw several changes become effective on the First of July.
More...Courts Side With Borrowers Over Lenders
An unprecedented increase in mortgage industry litigation is reinforcing the fact that lenders must ensure that they are in exact compliance with all applicable laws, regulations and lending guidelines. A deviation from exact compliance can have dramatic effect on a lender's ability to enforce its rights according to the law. A recent case in the United States Bankruptcy Court for the Northern District of California illustrates the point that in this current legal climate, lenders cannot afford to stray from strict adherence to all guidelines.
More...Kentucky Emergency Rule (HB 552) Prepays
A new Kentucky emergency rule required prepayment penalty documents to change, in addition to new fee restrictions [HB 552].
More...FHA Mortgage Insurance Premium Calculations
With the recent changes in the mortgage industry, and expanding FHASecure eligibility criteria, more lenders are turning to FHA loans to boost business. Questions concerning the Mortgage Insurance Premium calculation are common. Investors such as GMAC have cracked down on FHA loans where the Conventional PMI calculation has been used instead of the appropriate FHA MIP calculation. They will not purchase loans with Federal Truth-in-Lending Disclosure Statement payment streams that do not meet FHA standards.
More...Kentucky Emergency Rule (HB 552)
On April 28, 2008, Kentucky Governor Beshear signed HB 552, which makes several amendments to existing licensing and high cost laws. A new Kentucky emergency rule required prepayment penalty documents to change, in addition to new fee restrictions [HB 552].
More...Home Foreclosure Blocked Due to Predatory Lending Violations
In a recent potentially precedent-setting decision, New York Supreme Court Justice, Joseph Maltese, denied a bank’s motion to foreclose on a sub-prime mortgage due to several predatory lending violations.
In the LaSalle Bank N.A. v. Shearon Case (No.100255/2007, 2008 WL 268449), the lender LaSalle Bank, moved for summary judgment in its foreclosure action against David and Karen Shearon. Not only did Justice Maltese dismiss the foreclosure action by the lender, but also granted the homeowners summary judgment on their counter claim that the lender violated New York predatory lending law.
More...HUD Proposes RESPA Reform 2008
HUD’s proposed rules to simplify and improve the disclosure requirements for mortgage settlement costs under RESPA may provide some interesting challenges for most lenders and mortgage brokers. The main objective of these modifications is "to protect consumers from unnecessary high settlement costs." It is uncertain if the proposed changes will make the closing process clearer, more useful and less costly for consumers.
More...California RE 885 Disclosure
California RE 885 Disclosure - The loan comparison calculations for non-traditional and subprime mortgage disclosures in California have recently caused lenders to scramble. The complex calculations make it difficult to automate this new disclosure requirement.
More...Massachusetts Borrower Counseling Disclosure
A new initial disclosure was added for MA. The MA Counseling Disclosure, Cx 13391, is required per the new section in Massachusetts General Laws Chapter 184, section 17B ½. The idea is that if the borrower is a first time home buyer, they get counseling before the loan closes. The doc states they have received counseling and still opt into the loan (or that they are not a first time home buyer).
More...Home Valuation Code of Conduct
Lenders must represent and warrant that appraisals conducted in connection with single-family mortgage loans delivered to Fannie Mae and Freddie Mac, other than government-insured and -guaranteed loans, with application dates on or after May 1, 2009 conform to the Home Valuation Code of Conduct.
More...Proposed Regulation-Z Changes (73 FR 1672)
On December 18, 2007 the Federal Reserve Board announced in a Press Release, that proposed changes to Regulation Z were open for comment. "Our goal is to promote responsible mortgage lending for the benefit of individual consumers and the economy," said Federal Reserve Chairman Ben S. Bernanke.
More...DC Adds New Disclosure For Non-Conventional Loans
March 6, 2008 - A new disclosure requirement became effective February 28, 2008. Bill 167 - Mortgage Disclosure Ammendment Act of 2007 - requires lenders licensed under the Mortgage Lender and Broker Act to provide an additional disclosure to borrowers applying for "non-conventional mortgage loans."
More...Conforming Loan Limits Increased
February 12, 2008 - Last week, legislators on Capitol Hill passed President Bush’s economic stimulus package. An important component of the Bill, Section 2 of H.R. 5140, the Economic Stimulus Act of 2008 directly impacts the mortgage industry by temporarily raising the conforming loan limits in high cost areas across the country.
More...Countrywide Interest Credit Clarification
We have recently received several inquires about how ConformX deals with interest credits for Countrywide loans. In an announcement published on August 8, 2006, Countrywide iterated that interest credits may not be used to reduce finance charges, as they should be credits toward the first payment.
More...Maine Net Tangible Benefit Disclosure Updated Again
On January 17, 2008 the Maine Department of Professional and Financial Regulation released Joint Advisory Ruling #114 to clarify disclosure requirements promulgated under the "Act to Protect Maine Homeowners from Predatory Lending." A copy of the ruling can be found...
More...New Massachusetts Regulations Take Effect
On January 2, 2008 new mortgage lending reguations (940 CMR 8.00 et. seq.) became effective for Massachusetts. The revised section 8.05 removes the the previous disclosure requirements for the MA Mortgage Lender Disclousure and the MA Mortgage Broker Disclosure. A new disclosure is required...
More...Maine Requires Net Tangible Benefit Form
Maine adopted a new rule requiring lenders to provide a “Reasonable, Tangible Net Benefit Disclosure Form” at or before closing. This new form is required to be given for all loans made after December 31, 2007.
More...Colorado Emergency Prepayment Penalty Rule
The Colorado Division of Real Estate has issued Emergency Rule 4CCR 725-3 restricing the use of prepayment penalties. The new rule prohibits prepayment penalties that extend past the adjustment date of any teaser rate, payment rate or interest rate included in a mortgage loan.
More...MERS Requires Street Address on New York MERS Documents
MERS released Policy Bulletin Number 2007-2 announcing that effective immediately all MERS documents for New York must contain the street address of MERS. DocuTech has added the required address to the MERS version of our New York mortgages and New York assignments to fill this requirement.
More... Back Next- Compliant Solutions
- Layers of Compliance
- Compliance Resources
- Investors
- High Cost Loan & Predatory Lending Check
- Compliance Updates
- DocuTech RESPA Resources
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