07/02/2012
If a loan is more than 30 days delinquent, can we withdraw funds from their escrow account to make their payment? Are we also obligated to pay their property taxes if there are no escrow funds available to do so? Also, please let me know where I can find the answer in the regs. I've searched RESPA with no luck so I'd like to know how to be better at researching.
06/18/2012
We have a mortgage servicing company as a customer at our bank. The company collects monthly payments on the loans they service and deposits the funds at our bank. These funds represent principal, interest, tax and insurance payments. The funds are held at our bank until it is time to make an escrow payment or make a payment to the mortgage investor(s). Our question is whether or not we can pay interest on these deposits since our client is not the owner of the funds but more like a custodian. We understand we can now pay interest on business DDAs but we are uncertain if paying an entity interest on funds that don't ultimately belong to them would be a violation of any type of regulation or contract law.
06/04/2012
What if an HPML calculation was done incorrectly, later discovered to be an HMPL, and the first-mortgage loan closed without escrow? Is there a remedy?
05/07/2012
Does the annual escrow history statement have to separate amounts paid out for taxes, insurance, and other charges? We are under the impression the regulation has been changed and the amounts do not have to be separated.
04/02/2012
Our Bank has always used a one month escrow cushion for portfolio loans. We may start using two months for new loans. When the time comes to re-analyze annually all our loans, is it compliant to assume a one month cushion on older loans and two months on newer loans? Do you recommend uniform treatment?
02/13/2012
Regarding escrow requirements on higher priced mortgages: is there a time when the borrower can be released from the escrow requirement?
02/06/2012
We have a client who currently owns their primary residence and they are wanting to do a major renovation to the property The bank is looking at extending them a future advance – non-revolving loan for 12 months. The loan will be used to pay-out the 1st lien holder and provide funding for the renovations. We have a conditional permanent take out for the loan upon completion and/or the maturity of the loan. Monthly payments will be interest only during the 12 months- renovation phase. The regulation states a Higher Cost loan is: a closed end loan, secured by a consumer’s principal dwelling, for consumer purpose and has an APR exceeding the average of prime offer rate by 1.5% for a 1st lien or 3.5% for a subordinate lien. It excludes: HELOC’s, reverse mortgages, construction only loan and bridge loans with a term of no more than 12 months. Due to some of the variables of our scenario, we are unsure how to treat it. This isn’t a construction from the ground up, it’s not a revolving credit and the permanent take out that we have is conditional. We have conflicting opinions on how this particular situation fits in with the reg. The biggest difference is in how we treat it, on whether or not we have to have the taxes and insurance escrowed during that 12 month period. Our bank does not escrow for any other loans other than Higher Cost Loans which we are required to. Any insight you can offer will be greatly appreciated.
01/23/2012
Can you point me to the section of RESPA that refers to not deducting the escrow balance on a payoff?
12/12/2011
Reg O states that increases to existing indebtedness are not considered extensions of credit so long as "the additional funds are advanced by the bank for its own protection for accrued interest or taxes, insurance, or other expenses incidental to the existing indebtedness." Is a loan fee that was included in the amount financed included in this exception? Example: Executive Officer A has a loan for $100,000.00 with a $500 loan fee and an appraisal fee of $300 for a total amount financed of $100,800.00. Would this be a Reg O violation?
11/28/2011
A bridge loan has a term of 12 months and one of the properties is the customer's homestead. Is escrow still required even though there is temporary financing?