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#1314073 - 12/28/09 08:27 PM
Re: RESPA changes 1-1-10
Truffle Royale
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10K Club
Joined: Oct 2006
Posts: 14,390
Cheeseheadland
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Ditto that.
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#1314345 - 12/29/09 01:52 PM
Re: RESPA changes 1-1-10
#Just Jay
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Joined: Nov 2002
Posts: 20,656
The Swamp
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That is exactly where I'm hung up on this issue with AuditorK. The employee gets paid for the service, not the bank. This is the problem I have with it being in block 1.
The employee is not a title or settlement agent, so I don't see a fit for block 4.
The bank is requiring notorization, whether by the convenience of the on-site notary (who happens to be an employee) or by some other notary. This is why it seems to me Block 3 6 is the best fit.
Last edited by RR joker; 12/29/09 04:46 PM.
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#1314366 - 12/29/09 02:32 PM
Re: RESPA changes 1-1-10
RR Joker
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Platinum Poster
Joined: Feb 2003
Posts: 962
PA
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As RR Joker says, I'm having a hard time figuring out where this would go. Doesn't seem to fit in any Block.
The issue I have with Block 3 is that we don't require the borrower to use our notary. We offer her services, but if they want to chose their own notary, we don't have a problem with that.
Also, could we require the borrower to use the bank's employee without running into a Section 8 violation - since the employee benefits from the referral because she retains the fees not the bank?
Last edited by AuditorK; 12/29/09 02:35 PM.
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#1314409 - 12/29/09 03:45 PM
Re: RESPA changes 1-1-10
rlcarey
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Member
Joined: Sep 2003
Posts: 97
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On a different issue, the most recent FAQ's, page 25, GFE Block 5 #1 indicates "Loan originators MUST provide an estimate of the charge for an Owner's title insurance policy....." Is this only in the case if we require it? We are a small bank and typically don't even address this option; thus we won't be having it as a closing cost on the HUD either. If we have to disclose it on the GFE, our 10% tolerance items would be out of wack right away.
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#1314416 - 12/29/09 03:50 PM
Re: RESPA changes 1-1-10
fmb
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Diamond Poster
Joined: Sep 2008
Posts: 2,481
Midwest
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Am I right in after the interest rate is locked, a new GFE has be provided?
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#1314436 - 12/29/09 04:17 PM
Re: RESPA changes 1-1-10
ahkcompliance
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Power Poster
Joined: Feb 2005
Posts: 6,559
Foxboro
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Am I right in after the interest rate is locked, a new GFE has be provided? Yes-must reflect the correct dates in the "Important Dates" section as well as fee changes based on rate lock.
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#1314461 - 12/29/09 04:45 PM
Re: RESPA changes 1-1-10
Truffle Royale
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10K Club
Joined: Nov 2002
Posts: 20,656
The Swamp
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The issue I have with Block 3 is that we don't require the borrower to use our notary. We offer her services, but if they want to chose their own notary, we don't have a problem with that.
Your are right, AuditorK. On second thought, Block 6 is the best area to put this. It's required, but you can shop.
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My opinion only. Not legal advice. Say you'll haunt me - Stone Sour
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#1314470 - 12/29/09 04:49 PM
Re: RESPA changes 1-1-10
fmb
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10K Club
Joined: Nov 2002
Posts: 20,656
The Swamp
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On a different issue, the most recent FAQ's, page 25, GFE Block 5 #1 indicates "Loan originators MUST provide an estimate of the charge for an Owner's title insurance policy....." Is this only in the case if we require it? We are a small bank and typically don't even address this option; thus we won't be having it as a closing cost on the HUD either. If we have to disclose it on the GFE, our 10% tolerance items would be out of wack right away. Unfortunately, on a purchase, you have to include it no matter what. It will likely pad your tolerance if it's not purchased, however.
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My opinion only. Not legal advice. Say you'll haunt me - Stone Sour
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#1314502 - 12/29/09 05:07 PM
Re: RESPA changes 1-1-10
RR Joker
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New Poster
Joined: Apr 2008
Posts: 16
Florida
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Some of our loan originations require the borrower to deposit 6 months of PITI reserves. How should this be diclosed on the new GFE? If we include it in the "origination charges" section, we cannot dilineate the amount. Can it be disclosed in the "other settlement services" block and be considered in compliance with RESPA?
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#1314505 - 12/29/09 05:08 PM
Re: RESPA changes 1-1-10
sab
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Power Poster
Joined: Feb 2005
Posts: 6,559
Foxboro
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sab-you actually collect and hold reserves?
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#1314511 - 12/29/09 05:12 PM
Re: RESPA changes 1-1-10
RR Joker
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100 Club
Joined: Dec 2009
Posts: 173
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New poster here...I've gotten a lot of good information from previous posts, but have not seen the following question I need direction on. Our bank does RESPA-covered constrution lending. Draws are requested throughout the course of the loan. The bank orders a disbursement endorsement costing $35 from the title company that issued the title commitment. The borrower is then charged for the $35 for the DE. Currently on the GFE & HUD we estimate six DE's costing $35 each for a total of $210. This $210 is shown as a POC item on line 1305(as the borrower pays for the actual number of DE's, post-closing as they occur). The $210 is also calculated in the pre-paid finance charges/APR.
Am I correct in thinking that the $210 will now be shown on the HUD as line item 1301, and still as a POC item? Also, Since POC items are no longer reflected on the GFE, how will we disclose it - as a credit in box 2 (which doesn't make sense to me) or do we just not show it at all? HELP!!!
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#1314549 - 12/29/09 05:49 PM
Re: RESPA changes 1-1-10
Truffle Royale
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Gold Star
Joined: Apr 2002
Posts: 480
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[font:Comic Sans MS]runreb, you don't have an application if you don't have a property identified. It sounds like you're asking how this would be reported for HMDA. It would not be unless you have a pre-approval program. You might try posting this in the HMDA forum. I'm thinking about the denial process under new RESPA. I agree it would not be HMDA at that point. But, based on the scenario mentioned would you deny for Reg B purpose since you would have an incomplete application (no property address) or document the file as withdrawn? Thanks
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#1314596 - 12/29/09 06:54 PM
Re: RESPA changes 1-1-10
Truffle Royale
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Diamond Poster
Joined: Sep 2008
Posts: 2,481
Midwest
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If we offer a rate lock at application, can we lower the rate for any reason? Our officers have a .25% option to lower the rate if they deem necessary. It would never rise than the quoted rate. If we do rate lock at application, do we put NA on line 1 in important date section?
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#1314617 - 12/29/09 07:02 PM
Re: RESPA changes 1-1-10
ahkcompliance
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10K Club
Joined: Jul 2003
Posts: 17,410
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OH, lord, ahk, you don't believe in KISS, do you? This opens up a whole slew of questions. Under what circumstances would the LO 'deem it necessary' to lower the rate and why wouldn't they take care of that at the time of lock? Is this preferential treatment for some borrowers vs others?
As I understand it, the new RESPA looks to level the playing field for all borrowers and make it easy for them to compare prices. Having an ace up their sleeves in the form of a quarter point they can drop doesn't seem to fit that scenario. jmho
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#1314641 - 12/29/09 07:13 PM
Re: RESPA changes 1-1-10
Truffle Royale
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Diamond Poster
Joined: Sep 2008
Posts: 2,481
Midwest
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The quarter percent is hardly used but is available. In the past past we didnt do rate lock as we honored the quoted rate at the time of application but with HPML decided to do rate lock to avoid doing HPML.
So, if we state the interest rate is available for 10 days, then once we lock the rate in, a new GFE needs to be delivered? If we the rate is loced in at application, is line 1 NA?
Loan Department is looking at changing policy and procedure and I just need tomake sure I tell them the right way to fill in important date section. Sometimes they have me pulling my hair out!
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#1314731 - 12/29/09 08:13 PM
Re: RESPA changes 1-1-10
TB 12
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New Poster
Joined: Apr 2008
Posts: 16
Florida
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Yes, SOX in 07, we hold the reserve in a deposit account for borrowers' whose primary residence is in another country. The amount is disclosed on the TIL as a required deposit.
Last edited by sab; 12/29/09 08:18 PM.
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#1314761 - 12/29/09 08:26 PM
Re: RESPA changes 1-1-10
sab
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Member
Joined: Jun 2007
Posts: 87
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How are you completing the monthly payment line in Summary of your Loan on page 1 if it is a single payment loan with interest due at maturity? It doesn't seem right to include only the accrued interest due at maturity or the principal plus interest due at maturity since it says $XXX/month.
The training I listened to talked about converting bimonthly or semiannual to monthly.
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#1314768 - 12/29/09 08:31 PM
Re: RESPA changes 1-1-10
AmyH
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100 Club
Joined: Nov 2006
Posts: 115
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FAQ #1 - Interest Rate Expiration (pg 10) says that a revised GFE must be issued if any interst rate dependent charges and terms change.
I understood that to mean we only need to send a revised GFE if the new interest rate will cause settlement charges to change or the terms of the loan to change--not because it changes the important dates.
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#1314773 - 12/29/09 08:33 PM
Re: RESPA changes 1-1-10
sab
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Power Poster
Joined: Nov 2008
Posts: 4,132
Somewhere in the middle
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Title Updates or Searches with regard to construction loans. Would they be listed on line 1101 of the HUD but detailed on 1109-? And be in Block 4 of the GFE?
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